Consumer Forum Pulls Up Insurer For Rejecting Covid Claim Over 20-Year-Old TB History

A district consumer forum in Gujarat has ruled that an insurance company cannot deny a Covid-related health insurance claim merely because the policyholder had suffered from tuberculosis nearly two decades ago. The order is being seen as another reminder that insurers cannot reject claims on weak or unrelated grounds when there is no direct link between the earlier illness and the treatment for which the claim has been made.

The case came up before the Vadodara consumer forum after a policyholder’s family challenged the rejection of a Covid insurance claim. The insurer had argued that the customer had failed to disclose a history of tuberculosis from around 20 years ago, and therefore, the claim was not payable. However, the forum did not accept this argument.

According to case details, the commission observed that tuberculosis suffered decades earlier could not automatically be treated as a material factor for rejecting a Covid-related hospitalisation claim. The commission reportedly observed that the customer had been hospitalised for Covid treatment and not for tuberculosis. It also noted that the insurance company could not show how an illness suffered many years earlier had any bearing on the medical expenses claimed in this case, according to a recent The Times of India report.

Consumer Forums Taking A Tougher View On Claim Rejections

The ruling comes at a time when consumer forums across the country are increasingly examining whether insurance companies are rejecting claims on technical or procedural grounds without adequately proving how those issues materially affected the insurance risk.

In recent months, several consumer forum decisions have gone against insurers where claims were rejected due to alleged non-disclosure, technical documentation gaps, or interpretation disputes.

In one Vadodara case earlier this year, a consumer forum held that a patient could not be denied reimbursement simply because the hospital allegedly did not meet certain municipal registration norms. The commission observed that the policyholder could not be punished for lapses attributable to the hospital administration.

In another case, the Vadodara consumer forum ruled that merely alleging a pre-existing illness was not sufficient for denying a claim unless the insurer could prove that the condition materially affected the insured person’s life expectancy or the underwriting decision.

Similarly, another forum order rejected an insurer’s attempt to deny a medical insurance claim on the basis of alleged tobacco consumption, observing that the insurer failed to prove both usage and a direct causal connection with the illness.

Taken together, these orders show that consumer courts are no longer readily accepting claim rejections based only on past medical records or broad allegations. If an insurer wants to deny a claim citing an earlier illness, it may now have to convincingly demonstrate how that condition was connected to the treatment or hospitalisation for which the claim was filed.

Why Policyholders Should Still Disclose Medical History Properly

At the same time, policyholders are expected to share correct information about their medical history while buying insurance. Industry experts say hiding major illnesses or treatment details can later create complications at the claim stage, since insurance policies are issued based on the information provided by the customer.

However, legal experts say insurers are also expected to demonstrate how a non-disclosed condition was material to the claim being rejected. Consumer forums and courts have repeatedly stressed that insurers cannot rely only on broad allegations or old medical records without proving relevance to the present illness or treatment.

The Covid period, in particular, led to a large number of disputes involving hospitalisation claims, exclusions, treatment classifications, and interpretations of pre-existing diseases. Consumer forums have often taken the view that insurers should adopt a fair and balanced approach while evaluating claims arising out of medical emergencies.

The latest ruling is likely to offer some reassurance to policyholders who fear that old illnesses or remote medical histories may later be used to deny genuine claims unrelated to those conditions. At the same time, it also reinforces the message that customers should maintain proper records and disclose medical histories honestly while buying insurance policies.

The ruling also reflects a broader trend seen in consumer courts lately, where insurers are being asked tougher questions while rejecting claims. In several cases, forums have insisted that insurance companies clearly prove how a past illness was linked to the hospitalisation or treatment for which the claim was made.

FAQs

1. Can an insurer reject a health insurance claim because of an old illness?

Insurers may examine past illnesses, but they generally need to show how the earlier condition was connected to the present treatment or hospitalisation before rejecting a claim.

2. Why did the Gujarat consumer forum rule in favour of the policyholder?

The forum reportedly found that the insurer could not establish any direct link between the customer’s tuberculosis history from 20 years ago and the Covid-related hospitalisation expenses.

3. Should policyholders still disclose past medical conditions while buying insurance?

Yes. Experts say customers should honestly disclose their medical history while purchasing insurance, as incorrect or incomplete information can create disputes during claim settlement.