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Insurance firm to pay over Rs 4.5 L for deficiency in service

A consumer forum here has asked an insurance company to pay over Rs 4.5 lakh to a man, whose medicalim it had rejected, for indulging in unfair trade practice and deficiency in service.

The North-East Delhi Consumer Disputes Redressal Forum, presided by N K Goel, directed Oriental Insurance Company Ltd to pay Rs 4,53,678 to Delhi resident Vinay Jain towards his medical expenditure, compensation and litigation expenses.

"...We hold that while rejecting the claim in question of the complainant, OP (Oriental Insurance Company Ltd) indulged in unfair trade practice and committed gross deficiency in service," the forum, also comprising members Asha Kumar and Nishat Ahmad Alvi, said.

The forum noted that the insurance company had cited its alleged circular, which was "non-existent" at the time, to justify rejection of the claim.

The company claimed that as per the circular, continuity benefit could be given only if the policy was continuously insured with Oriental Insurance Company Ltd.

"The claim of complainant had been rejected on July 16, 2012, and rejection was confirmed by the competent authority of the OP (insurance company) on October 30, 2012. On October 30, 2012, the alleged circular dated November 6, 2012 was not in existence. It had not taken birth by that date.

"Therefore, how did and how could OP (insurance company) take shelter of any such non-existent circular is beyond our comprehension and imagination," the forum said.

It added, "Before taking such frivolous, imaginary and ridiculous plea before any forum, the officers of the insurance company must think over the matter hundreds of times and must always avoid to take such irresponsible and childish pleas."

Jain, in his complaint, had told the forum that he had obtained the mediclaim policy from the insurance company on May 26, 2011.

Prior to that, he had already taken the mediclaim policy from National Insurance Company Ltd for last about 10 years and thereafter, he got it transferred to Oriental Insurance Company Ltd on May 26, 2011 and the firm had agreed to give him continuity benefits.

Article referred: http://www.business-standard.com/article/pti-stories/insurance-firm-to-pay-over-rs-4-5-l-for-deficiency-in-service-114080100883_1.html

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