Lifestyle disease no reason to deny insurance claim, rules consumer panel

The apex consumer commission has asked LIC India to pay Rs 5 lakh to the kin of a deceased diabetes patient and made clear that insurance claims cannot be denied on the ground of common lifestyle diseases. 

The National Consumer Disputes Redressal Commission, while setting aside the Punjab state commission's order, asked the Chandigarh branch of the Life Insurance Corporation India to pay the sum along with compensation Rs 25,000 and litigation cost Rs 5,000 within 45 days to Punjab-resident Neelam Chopra. 

Neelam Chopra's husband, who was suffering from diabetes, had availed a life insurance claim in 2003 from the company. While filling the proposal form, he had not mentioned about his disease. 

He died of a cardiac arrest in 2004. 

After her husband's death, when she claimed the policy, the company rejected it on the ground that the deceased had suppressed information regarding his health at the time of effecting the policy and that the claim has become time barred. 

"The deceased died on account of 'cardio respiratory arrest' which was existing for only five months prior to the date of death. Thus, clearly, this disease was not prevailing when the proposal form was filled. The disease of diabetes, though was existing for some time but was under control at the time of filling up of the proposal form. Moreover, the non-disclosure of information in respect of this lifestyle disease of diabetes, will not totally disentitle the claimant for the claim," the commission said. 

The apex commission, however, said that this ground does not give any right to the person insured to suppress information of such diseases and the person insured may suffer consequences in terms of the reduced claims. 

The commission said suppression of any information relating to pre-existing disease if it has not resulted in death or has no direct relationship to cause of death, would not "completely disentitle" the claimant for the claim. 

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