Page 48 - The Insurance Times September 2025

Case Study

Health Insurance & Marine Cargo Insurance

Case Study : Health Insurance Whether rejection of a claim based on ambiguous or
unverified assumptions is justified.
Supreme Court Judgment – Ravindra Prabhakar
Kumbhar vs Divisional Manager, United India Court Observations
Insurance Co. Ltd. (2020) The Supreme Court made the following critical observations:
Utmost Good Faith Applies Both Ways: The doctrine
Background of uberrimae fidei (utmost good faith) must be observed
Mr. Ravindra Prabhakar Kumbhar was covered under a by both the insured and the insurer. Insurers cannot
health insurance policy by United India Insurance Co. Ltd. expect absolute disclosure while being negligent in
He had been regularly renewing his mediclaim policy for policy administration.
several years without any reported health complications.
Materiality and Intent Matter: For a repudiation to be
However, when he filed for a reimbursement claim after
valid, it must be proven that the insured wilfully sup-
undergoing heart surgery, the insurer rejected the claim
citing alleged non-disclosure of a pre-existing condition— pressed a material fact that had a direct bearing on the
hypertension. claim.
Duty of the Insurer: The insurer must demonstrate
The Dispute that the non-disclosure directly influenced the under-
The insurer contended that the insured failed to disclose his writing decision and risk acceptance. Minor ailments
hypertension condition during the policy inception, which, like controlled hypertension do not automatically
they claimed, contributed to his cardiac ailment. Mr. equate to willful concealment.
Kumbhar argued that: Repeated Renewals Implied Acceptance: Given that
He had no major ailment prior to the heart issue. the insurer had renewed the policy multiple times with-
He had disclosed all known medical facts to the best of out demanding new disclosures or health check-ups, the
his knowledge. benefit of the doubt lies with the insured.
The insurer had not asked for detailed health check-ups
or medical declarations in earlier policy renewals. Judgment
The Supreme Court ruled in favour of the policyholder. It
Additionally, it was pointed out that the policy had been
directed United India Insurance to settle the claim promptly,
renewed several times without any red flags being raised
regarding the supposed condition. with applicable interest.

Key Legal Issues Key Takeaways
Reinforces the insured’s rights against arbitrary claim
Whether a mild case of hypertension amounts to a ma-
terial non-disclosure. repudiation.

Whether the insurer had performed appropriate due Underscores the importance of clear underwriting and
diligence at the time of policy renewal. medical disclosures.

44 September 2025 The Insurance Times