Kathmandu. The Insurance Authority of Nepal (BEE) has delivered an important verdict in a case related to a fatal disease related to Citizen Life Insurance. The decision reinstates the legal provision that the insurance company does not have to pay the claim if the disease is diagnosed within 180 days of the insured.
If you have taken the benefit of critical illness along with life insurance, it is very important to know the waiting period for it. Recently, the Insurance Authority of Nepal (ANI) ruled in a case of Citizen Life Insurance Company that the insurance company is not liable to pay the claim if the terminal illness is proved within 180 days of the insurance company.
What was the incident?
On April 12, 2079, Citizen Life Insurance had issued life insurance cover of Rs 500,000 in the name of insured Manisha Kumari Yadav. After about 3 months of the insurance, the health of the insured patient deteriorated within 98 days and he was diagnosed with kidney failure during the check-up at National Medical College, Birgunj on July 5, 2080.
The case was filed against the insured Shailendra Kumar Yadav for Rs 5 lakh, but the company refused to pay him citing that the waiting period was not over.
While deciding on this dispute, the authority had made the waiting period mandatory for the risk to be implemented as the main basis of the decision. While studying the supplementary contract of Citizen Life, the Insurance Authority found that there are some clear conditions for critical illness benefits. In order to resume the critical illness facility, one must not have a fatal disease for 180 days i.e. about 6 months from the date of commencement of the policy. In addition, the insured must have been alive for at least 30 days at the time of diagnosis.
Authority
}
In the present claim, it appears that the insurance policy was issued on April 29, 2022 and the fatal disease was identified on July 21, 2020. This period is only 85 days from the date of commencement of the insurance. According to the terms of the contract, the insurer’s liability does not arise because the disease has been diagnosed without the 180-day waiting period. On this basis, the authority has ordered the dismissal of the claim of the insured on December 19, 2081.
Why is there a waiting period for ?
The main purpose of having a fixed waiting period for a critical illness in the insurance sector is to manage the risk that may occur in insurance. This rule is used to prevent adverse choices if someone suspects that they have a disease and wants to claim insurance immediately.
This facility is intended to provide financial support to the insured who have been healthy for a long time in the event of a major health crisis in the future.
Things the insured should know
Many people get the benefit of a fatal disease but do not understand its terms. The ruling prohibits the insured from making a claim for a terminal illness, and according to the company, the waiting period can range from 90 to 180 days.
A critical illness facility is a supplemental contract. The terms of which may be different and stricter than the terms of the original life insurance policy.
