Delhi High Court slaps ₹50K fine on insurance company for denying claim of breast cancer patient

The Delhi High Court recently imposed a fine of ₹50,000 on Central government owned New India Assurance Company for harassing and causing mental agony to a breast cancer patient by denying her claim [Garima Singh v New India Assurance Co Ltd & Ors]..Justice Subramonium Prasad said that there is no ambiguity in the mediclaim policy and the sub-limit of ₹2 lakh which is applicable to immunotherapy does not apply to Chemo-immunotherapy, a new form of treatment which is a combination of chemotherapy and immunotherapy.“Even assuming without admitting, there is an ambiguity, the principle of contra proferentem would be applicable to this case and the petitioner would be entitled to the entire amount as claimed,” the Court said.It, therefore, ordered the insurance company to clear the claim of petitioner Garima Singh who had been receiving treatment for breast cancer which later spread to her lymph nodes and to both the lungs.“Accordingly, the writ petition is allowed with a direction to the Insurance Company to clear the claim of the petitioner within four weeks from today. In view of the fact that the petitioner, who is a cancer patient, has been harassed without any reason and has been deprived of the amount putting her to mental agony, this Court is inclined to impose costs of ₹50,000/- on Respondent No.1/Insurance Company to be paid to the petitioner within four weeks from today,” the Court stated. .Singh moved the Court claiming that she purchased an insurance policy for the new India Assurance Company with a total cover of ₹44.5 lakhs.In 2021, she was diagnosed with stage-IV breast cancer which later spread to her lymph nodes and to both her lungs. She started undergoing Chemo-immunotherapy for the treatment of the disease.The Court was told that she made a claim under the insurance policy but the same was denied by the insurer on the ground that the claim made exceeded the terms of the policy as a claim for treatment for giving Monoclonal Antibody injections - immunotherapy - cannot exceed ₹2 lakh.Singh filed a complaint before the Insurance Ombudsman claiming an amount of ₹11 lakh for the cost of treatment undergone.The Ombudsman directed the insurer to settle the claims as a precious life was being saved by such medical treatment as needed and as advised by the doctor.Singh then moved the High Court alleging that the insurance company was not complying with the order..The New India Assurance Company told the court that as of now more than ₹37 lakh have been paid to the petitioner. It said that the award passed by Ombudsman only directs them to pay the amounts as per the terms and conditions of the policy and the terms and conditions of the policy specifically stipulates that for immunotherapy, the maximum amount that can be paid is only ₹2 lakh.The Court rejected the insurance company’s argument and held that the fact that the insurance company has already paid ₹37 lakh to the petitioner is not relevant to the present claim and that it must pay the amount as claimed.The Award passed by the Ombudsman has to be complied with in letter and spirit, it added..Advocates Dr Amit George, Abraham Mathews and Adhishwar Suri appeared for the petitioner.New India Assurance Company was represented by advocate JPN Singh..[Read Judgment]