Insurer Must Pay Rs 1.47 Lakh For Woman’s Depression Treatment After Claim Rejection

A Bengaluru consumer commission found that an insurer had not justified rejecting a young woman’s hospital claim by treating severe depression as intentional self-injury.

Insurer Cited Intentional Self-Injury

A 21-year-old woman’s claim for hospital expenses after treatment for severe depression was rejected by her health insurer. The company said its investigation found that she had been admitted following intentional self-injury, which it said was excluded under the policy.

The woman challenged the decision before the Bengaluru I Additional District Consumer Disputes Redressal Commission. She sought reimbursement of Rs 1.45 lakh, saying she had held a Family Health Optima policy since April 9, 2011, and renewed it over the years.

The insurer rejected her claim on April 25, 2025. It argued that her admission took place during a lapse in the policy’s renewal and that the rejection was in line with the policy’s terms. It also questioned whether the complaint could be heard and alleged that important facts had been withheld.

The woman relied on policy provisions relating to the moratorium period and grace period, and disputed the insurer’s account of the circumstances. The latest policy period ran from April 11, 2025, to April 10, 2026.

Commission Found Rejection Was Not Justified

The commission examined the hospital’s discharge summary, which recorded severe depression as the final diagnosis. It said depression can arise for several reasons and cannot, by itself, be treated as intentional self-injury.

It also noted that the medical expenses were supported by hospital bills. The insurer had not shown why the diagnosis and records were insufficient to support the claim, the commission found. Rejecting the reimbursement on technical grounds amounted to a deficiency in service.

The order, passed on September 29, 2026, directed the insurer and the other opposite parties to pay Rs 1.45 lakh jointly and severally within 30 days. If they fail to do so, the amount will carry interest at 6 per cent per annum from November 18, 2025, the date the complaint was filed, until payment. The commission also awarded Rs 2,000 towards the cost of the proceedings and asked the opposite parties to file a compliance report within 45 days of receiving the order, according to a recent report by The Indian Express.

The ruling turned on the medical evidence and the facts of this particular dispute. It does not mean every claim for depression treatment must be paid automatically. Cover depends on the policy wording, the treatment records and the circumstances of each claim.

What Policyholders Can Do?

If a health insurance claim is rejected, ask the insurer for the decision in writing, including the specific policy clause it has relied on. Check that clause against the policy schedule, renewal documents, hospital records and bills. Keep copies of all claim forms and correspondence.

A policyholder who believes the rejection is unsupported can first use the insurer’s grievance process. If the dispute remains unresolved, the complaint may be taken to the appropriate consumer commission. In this case, the commission found that the insurer had not adequately supported its reason for rejecting a claim backed by medical records and hospital bills.

FAQs

1. Does health insurance cover hospitalisation for severe depression? 

Yes, eligible hospitalisation for severe depression may be covered under health insurance, subject to policy terms, exclusions, and medical records.

2. Can an insurer reject a depression claim citing intentional self-injury? 

An insurer must have evidence supporting the exclusion. The Bengaluru commission held that a diagnosis of severe depression alone does not establish intentional self-injury.

3. What should policyholders do if a mental health insurance claim is rejected? 

Request written reasons and the relevant policy clause. If the rejection appears unjustified, approach the insurer’s grievance department and, if necessary, the appropriate consumer commission.