N. Raghuraman's column: One malafide intention defames the entire industry

Imagine, your relatives are hospitalized. After the doctor writes the medicine prescription, you are busy getting the medicine from the hospital medical. They are keeping all the bills safely, because they want to claim insurance benefits later. He also paid for the blood tests done at the hospital. The doctors gave you medicines and the relatives soon recovered and were discharged. Heaving a sigh of relief, he returned home and started preparing to apply for a refund of less than Rs 15,000 for hospital expenses. You are confident that these bills will be approved by the insurance company, because you have not raised any claim since buying the insurance and have paid four and a half times the claim amount as premium. But you were surprised when the company not only rejected the claim of hospital expenses, but also canceled your policy citing procedural flaws and suspected fraud. Not only this, your name also appeared in the Fraud Alert Database, which means that no insurance company will insure you in the future and if you do, then every claim of yours will be seen as a fraud. Wondering where the fraud finally came from? To understand this, read the story of 29-year-old Veeresh Rathod from Bengaluru, who bought a group insurance policy from an insurance company in 2022 for himself and elderly parents. In three years, he paid Rs 67,606 to the company and since then he has not taken any claim. In April 2024, his mother was admitted to the local Sharabhathi Hospital for treatment of severe gastroenteritis. After his mother was discharged from the hospital, Rathore filed a repayment claim of Rs 14,500, which was rejected and his policy was also cancelled citing the following reasons. 1. The company alleged that the broad-spectrum antibiotic drug (Piptaz) was given without any culture sensitivity test. 2. Rathore reportedly bought 5 doses, while only three came into use. 3. Lacks the certification of the physician on the discharge details. 4. The blood reports were signed by the technician and not the pathologist. Now tell me, what is your role or that of Rathore in the selection of antibiotics, the tests to be done, the documentation errors? How do you expect them to know that a test is necessary before administering a medicine? How can they expect us to know what the discharge details look like or how should we check whether the signature on the report is of a technician or a pathologist? What is even more surprising is that the company cancelled Rathore's policy and also issued an internal industry alert calling him a person making fraudulent claims, which hurt his reputation and also affected his chances of getting insurance in the future. Rathore's appeal to the Insurance Regulatory and Development Authority and the Insurance Ombudsman remained unanswered. He then approached the consumer forum on 24 June 2024. The company said that the complaint is baseless and these discrepancies point to deliberate misappropriation. But after examining the evidence, the commission rejected the company's arguments. On May 16, the court ordered him to pay a compensation of Rs 1 lakh to Rathore for mental agony, Rs 14,500 as interest on rejection of the claim, Rs 10,000 as legal costs and Rs 50,000 as punitive compensation to the Consumer Welfare Fund. The insurer was instructed to issue a new insurance policy for the remaining period and renew it later. It will also have to remove Rathore's name from the Fraud Alert database. The funda is that bad intentions in a process with a single customer can be a threat to the industry as a whole. Having clear intentions helps in the development of the industry.