The Ernakulam District Commission has held that insurer dependence on a clause without adducing evidence amounts to a failure in service.

Very recently, the Ernakulam District Commission ruled, holding Oriental Insurance responsible for a service deficiency due to the improper denial of a legitimate claim. The case revolves around the complainant who was insured under a Happy Floater Mediclaim Policy with Oriental Insurance. The complainant's wife underwent eyes treatment and spent Rs. 95,410 for her surgeries, when the complainant claim for insurance amount the insurer paid only Rs. 61,200, as reasonable according to him. Aggrieved, the complainant approached the Insurance Ombudsman, which also upheld the decision of the insurer. Disappointed with the decision he approached the District Commission and lodged a complaint. He claimed that the deduction of Rs. 34,210 was not justified and sought reimbursement with 12% interest along with Rs. 10,000 for mental agony and legal costs. The insurer argued that the insurance contract was subject to specific terms and conditions binding both parties, and their liability was limited to those terms. They disputed the complainant's claim that hospital expenses were reasonable compared to other hospitals in Kerala, asserting that the deduction was neither illegal nor indicative of service deficiency. They specifically pointed out that the policy covered only "reasonable and customary charges" and that they have already paid Rs. 61,200 after policy-based deductions. The insurer further pointed out that the charges related to lenses were not covered under the insurance cover. The Insurance Ombudsman, in its previous ruling, had rejected the complainant's case as that would not be supportive of the insurer's position. On those grounds, the insurer pleaded for the dismissal of the complaint with costs. The District Commission observed that the main defence of the insurance company hinged on the clause in the policy under the keyword "reasonable and customary charges." However, the insurance company could not provide evidence to support these deductions. In this respect, the Commission read an element of inadequacy in service in relying on this clause without evidence. The Commission directed the insurer to pay Rs. 34,210 being the outstanding claim amount. Also, Rs. 5,000 compensation was ordered to be paid by the insurer on account of mental agony, financial loss and hardships suffered due to the deficiency in service and unfair trade practice and Rs. 5,000 on attorney's cost. Published by **Voxya** as an initiative to help consumers in resolving consumer complaints.