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Mis-selling while porting the Health policy
Share An insured having a group mediclaim from Bank 1 went to his Bank 2, where he had a savings account, for portability (not knowing that Bank to Bank portability is not allowed by IRDA). Insurance company of Bank 2 however accepts the proposal along with the Portability form and issues it as a fresh policy (with Sum insured of Rs.5 lacs) with no written intimation to the client about non acceptance of his port request. Going further, after 5 days of taking policy, Insured was detected with Covid and hospitalised and ended up with a total bill of Rs.20 lacs. Insurance company rejected the claim with 30 days illness clause. Please suggest what should the insured do here and whether he stands a chance to challenge the rejection of his claim as he was never communicated by the insurance company about issuance of the fresh policy
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There seems to be a clear case of deficiency in service on the part of the insurer. Having accepted the portability application, fresh policy can’t be issued without porting benefits from previous policy. If portability is not being achieved that must be communicated to the policy holder well in time so he can continue with existing insurer and protect his benefits or look at other alternatives. Matter can be represented to Ombudsman, if insurer doesn’t take corrective action and pay the claim.