In a significant verdict, the Supreme Court recently ruled that health insurers have the legal right to reject or repudiate any health insurance claims. The decision-makers note that such an action can be taken in case the policyholders fail to disclose that they consume alcohol at the time of buying insurance. The court’s decision highlights the importance of full disclosure at the time of application.
Man Fails To Disclose THIS
In this case, the court upheld Life Insurance Corporation’s (LIC) decision to deny the claim based on material misrepresentation. The ruling deals with the case of a man who bought the Jeevan Arogya policy in 2013 from the corporation. While filling out the application form, he failed to reveal that he was an alcoholic. A few months later, after complaining of severe stomach pain, he was admitted to a hospital in Haryana’s Jhajjar.
Law Body Orders LIC To Pay Widow Rs 5.21 Lakh
However, after receiving treatment, he suffered a cardiac arrest within a month. According to reports, the health insurer deemed the claim invalid and argued that “self-inflicted diseases and complications” are excluded under their policy. The district consumer forum initially gave the verdict in favor of the widow. The law body ordered LIC to pay her Rs 5.21 lakh.
LIC Reaches Supreme Court
This decision was also upheld by the state and national consumer commission on the grounds that he did not die from a liver-related condition. However, LIC reached the Supreme Court, which overturned the district consumer forum’s decision. A bench led by Justices Sandeep Mehta and Vikram Nath noted that the deceased man had been drinking for many years.
They observed, “Alcohol does not cause liver disease overnight.” Given the widow’s financial instability, the Supreme Court, however, chose not to ask her to return the Rs 3 lakh that she had already received from the health corporation.
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