ERNAKULAM: In a sharply worded order, the Ernakulam District Consumer Commission faulted Future Generali India Insurance for “arbitrary and medically unsustainable” claim denial, calling it a violation of fairness at the heart of consumer protection.
A Case of Medical Urgency, Denied by Policy
The complaint arose from a moment of medical crisis. The policyholder — a beneficiary of a group health insurance plan issued by Future Generali India Insurance Company Ltd. and administered through its affiliate, Future Generali Health — had paid ₹2.69 lakh in premiums for a coverage limit of ₹5 lakh.
During the policy’s validity, he was admitted to a hospital in Kerala for treatment of bulbar urethral stricture, a painful condition that obstructs urine flow. His diagnosis also included posterior urethral calculus, Type-2 diabetes, and systemic hypertension. The prescribed treatment, Visual Internal Urethrotomy (VIU), resulted in a hospital bill totaling ₹71,553.
When the hospital submitted the claim for cashless approval, the insurer sanctioned only ₹35,000 — invoking a sub-limit for urinary stone removal. To the complainant’s shock, the insurer classified the procedure under this cap despite medical records clearly identifying the surgery as one for urethral stricture, not calculus.
Disputed Definitions and Documentary Evidence
The insurer argued that its internal review found the surgery related to urinary stone removal, asserting that urethral stricture was merely a complication arising from chronic calculus disease. Quoting a policy clause, the company maintained that claims “for stone removal” were capped at ₹35,000.
The complainant, however, furnished doctor’s certificates and discharge summaries to demonstrate that the procedure was strictly for VIU, not stone extraction. He alleged deficiency in service and unfair trade practice, arguing that the insurer’s reasoning ignored the medical evidence.
After reviewing the testimony and documents, the Commission held that the insurer’s reading of the policy was “factually incorrect.” Applying the principle of contra proferentem — which requires that any ambiguity in an insurance policy be interpreted against the drafter — the Bench concluded that the insurer’s narrow reading amounted to deliberate misapplication.
“A Safety Net, Not Another Hurdle”
In an unusually human-centered observation, the Commission wrote:
“We cannot ignore the human reality behind this file: the Complainant sought urgent treatment for a painful, intimate condition and, while recovering, was drawn into a technical dispute about sub-limits that did not match the surgery actually performed. An insurance policy is meant to be a safety net in those anxious hours — not another hurdle.”
The order criticized the insurer’s reliance on what it called a “cherry-picked incidental reference to calculus”, noting that the resultant short payment and repeated correspondence caused avoidable distress to the patient.
“Consumer protection is, at its heart, about restoring that sense of fairness,” the Bench said. “Our decision aims to do just that, and to signal that claim assessment must be accurate, humane, and faithful to the medical evidence.”
Legal Precedent and Final Order
Citing the Kerala High Court’s decision in Dr. A.M. Muraleedharan v. The Senior Divisional Manager, LIC, the Commission reaffirmed that denial of insurance claims for legitimate medical treatment can violate the right to life under Article 21 of the Constitution.
Rejecting the insurer’s defense as “arbitrary, medically unsustainable, and contractually unfounded,” the Commission found Future Generali guilty of deficiency in service. The Bench comprising D.B. Binu (President), V. Ramachandran, and Sreevidhia T.N. directed the insurer and its administrator to:
- Pay the balance hospital bill in full,
- Award ₹25,000 as compensation for harassment and mental agony, and
- Reimburse ₹5,000 towards legal costs, all with applicable interest.
“The plea of strict construction is unavailable where the clause is misapplied to a procedure it does not cover,” the order concluded.
Restoring Fairness in the System
In its closing words, the Commission sought to reaffirm the principle that insurance exists to ease distress, not deepen it. The verdict — while concerning a relatively modest amount — carries broader implications for India’s expanding health-insurance market, where disputes over policy wording often leave patients stranded between bureaucracy and recovery.
