Skip to main content

 

PED (Pre Existing Disease) in Health Insurance

With many media platforms encouraging people to buy Health Insurance at a young age to maintain continuity of cover and gain wider cover, choosing the right Policy/Plan is an uphill task .Buying Health Insurance is an absorbing activity as there are a lot of terms and conditions, caps, exclusions etc. in the fine print of the policy which the buyer is unaware.

One such is PED or the preexisting disease condition.

What is PED?

A medical illness or injury that exists before the inception of a fresh health policy, is considered a pre-existing condition. Conditions like asthma, diabetes hypertension, thyroid are examples of pre-existing health conditions. They tend to be chronic or long-term.


What is a pre-existing disease according to the IRDA?

Pre-Existing Disease means any condition, ailment or injury or related condition(s) for which there were signs or symptoms, and were diagnosed, and for which medical advice ,treatment was received within 48 months prior to the first policy issued by the insurer and renewed continuously thereafter.

Ø  Any condition, ailment, injury or disease that has been diagnosed up to 48 months before buying your first health insurance policy.

How do we know whether we have PED?

Small ailments like cough cold allergy do not come under preexisting disease as they are not chronic and are situational and stress related. However prolonged & recurring condition or ailment must be declared in the proposal form.

What happens if we don't disclose pre-existing condition?

The contract of insurance is based upon principle of Uberrima fides -Utmost Good Faith which means that the proposer is bound to disclose all relevant facts within his knowledge including his/her pre-existing diseases, because this forms the basis, for the insurance company to arrive at the decision of assuming cover for the proposer and at what terms and conditions, premium amount, coverage etc.

Not declaring pre-existing medical conditions will not only lead to claim rejection, but the policy will also be considered null and void.


What is material to the claim or not is an important aspect

For example- A was a happy 50 year old enjoying life to the full until he was suddenly diagnosed with heart disease. He was suffering from back pain and muscle related illness for a long time. He was under good medication and fine, however a stroke changed his life.

The Health policy that he had taken refused to settle his claim as he had not disclosed the medical condition correctly at the time of the proposal.

A argued that the medical condition not disclosed by him was not material to his heart attack at present. The Insurer negated his account and cited Non-Disclosure clause.

Insurance company argued that the proposer has intentionally and deliberately hidden his/her pre-existing disease(s) in order to save the premium amount thereby causing financial loss to the  company and the insured has  violated the principles of utmost good faith – the basic principle of Insurance. Hence the claim was not payable.

Non-disclosure has two sides:

Ø  The insured knew that he/she is suffering from a pre-existing disease and intentionally omits to mention the same in the insurance policy

Ø  The insured himself is not aware of that he/she is suffering from a certain disease or assumes a symptom to be routine pain, for example a person may mistake a chest discomfort to be a sign of gas or acidity rather than an underlying heart problem.

The point to examine is whether the nondisclosure is material to the current ailment or not. If the nondisclosure was not material to the claim, the Insured may get away with the claim with the help of various Court judgments in the matter. However this is a prolonged process.

If the insured was unaware of the hidden ailment then the Courts have held that where suppression of any material facts was done by the insured which is not in the knowledge of the Insured, then the benefit of doubt is given to the insured.

 

Insurance is a contract and utmost good faith is the key between the proposer and the insurer. It is important to maintain good faith and disclose facts in the proposal form to avoid unnecessary disputes in the event of a claim and it is in the best interest of both parties-Insured and the Insurer.

We at Zen Insurance help in choosing the right coverage that fits your needs and budget. Plan your Health Insurance Program wisely and contact us for assistance.

 Disclaimer:   

Zen Insurance is an IRDAI registered broker which facilitates quick & accurate insurance broking services. We deal with only regulator approved products of insurers. We do not underwrite the products

 



Comments

Post a Comment

Popular posts from this blog

Prior and Pending Litigation in Professional Indemnity Policy

  The prior and pending litigation exclusion in liability policies is a clause designed to exclude coverage for claims related to legal disputes or circumstances already known, pending, or in progress before the policy's effective date. It’s an important exclusion because it limits the insurer’s liability for events that occurred before the policy began. Here are more details about this exclusion. Purpose of the Prior and Pending Litigation Exclusion Insurers include this exclusion to avoid covering claims or disputes that were known or existed before the policy started. It ensures that the underlying policy , Directors & Officers (DnO), Professional Indemnity (PI) policy, etc., only covers new claims that arise from professional errors, omissions, or negligence occurring during the policy period and not pre-existing or ongoing legal matters. What the Exclusion Covers Prior Litigation : Any lawsuit, claim, investigation, or l...
Post a Comment
Read more

Mitigation Costs in Professional Liability Policies

  Professional Liability Insurance in India, more commonly referred to as Errors & Omissions (E&O) insurance in the case of businesses, provides the business with insurance coverage against claims of negligence, error, or omission in the services rendered by the business under insurance. In this policy, one of the features includes mitigation cost coverage. Mitigation costs are sums of money that an Insured pays to avoid or lessen the possibility of a claim arising. For example, if a business finds an error in its work that may give rise to a potential liability claim, it may incur expenses to correct such error before it generates a claim. These costs will be incurred in trying to reduce the potential damage or liability and, therefore, may be covered under a professional liability insurance policy. However for mitigation cost section claim to trigger there needs to be a claim payable under the policy. Once the claim is determined to be payable under the policy, the miti...
Post a Comment
Read more

Third Party claims under Motor Insurance

                                  There are two sections within a comprehensive motor policy -o wn damage section and third-party section (3 rd Part Section). Own Damage section is voluntary insurance based on the Insured Declared Value (IDV) opted by the insured while 3 rd Party section is compulsory under the provisions of the Motor Vehicles Act 1988 (MV Act).   While own damage section takes care of damage to the motor vehicle due to accidents, Act of God perils, etc., the third-party section covers third party property damages and bodily injuries.             Details of third-party cover in motor insurance : Third party cover : Third-party insurance, is called as ‘Act Only’ insurance as it is a statutory requirement for all vehicle owners as per the Motor Vehicle Act. This policy covers accident, loss of life and damage to the...
Post a Comment
Read more