An insurance contract is based on the principle of uberrimae fidei (utmost good faith); thus, any deliberate suppression of material facts, such as chronic alcoholism, by the insured entitles the insurer to repudiate the claim as the suppression vitiates the underlying insurance contract.

PER RAJESH K. ARYA, MEMBER

The instant appeal has been filed by the opposite party– M/s The Oriental Insurance Company Limited (appellant herein) seeking setting aside of order dated 26.08.2025 passed by District Consumer Disputes Redressal Commission-II, U.T., Chandigarh (hereinafter to be referred as ‘District Commission’) vide which, Consumer Complaint bearing No.626 of 2022 filed by the complainant – Umesh Suri (respondent herein) has been partly allowed against the appellant/opposite party by granting following relief:-

“16. Resultantly, present consumer complaint succeeds and the same is hereby partly allowed. OP is directed as under :-

(i) to pay to the complainant claim amount of ₹1,31,993/- alongwith interest @ 6% per annum from the date of repudiation i.e. 10.6.2022 till the date of actual realization by the complainant.

(ii) to also pay lump sum compensation of ₹10,000/- to the complainant towards the harassment caused as well as litigation expenses.

17. This order be complied with by the OP within 60 days from the date of receipt of its certified copy.”

2] In brief, the case of the complainant before the District Commission was that he is an account holder of Oriental Bank of Commerce, which had floated a health insurance scheme for its account holders. Believing the same, the complainant took a health insurance policy from the opposite party in the year 2015 namely “OBC – Oriental Mediclaim Policy Group Schedule Bank Account Holders of OBC Only” and got the same renewed every year. Finally, the complainant got the said policy renewed for the period from 11.2.2022 to 10.2.2023 (Ex.C-1) with a sum assured of ₹3,00,000/- and paid the requisite premium. On 13.4.2022, when the complainant returned from Haridwar, he felt uncomfortable and was taken to Alchemist Hospital by his brother where he was admitted. After undergoing some tests, he was diagnosed to be suffering from jaundice and liver problem and was finally discharged on 17.4.2022 after treatment by the treating hospital. The bill of ₹1,31,993/- (Ex.C-6) which was paid by the complainant but the claim lodged by him was repudiated by the opposite party vide letter dated 10.6.2022 (Ex.C-7) stating that treatment of alcoholic drug or substance abuse or any addictive condition and consequences thereto were excluded. The complainant averred that he was neither an alcoholic nor a chain smoker and used to consume only occasionally in family parties. Alleging the act of the opposite party in repudiating his genuine claim amounted to deficiency in service and unfair trade practice on its part, he filed the consumer complaint before the District Commission seeking reimbursement of the bill amount along with compensation and litigation expenses.

3] On the other hand, the opposite party, in its reply before the District Commission, pleaded that the claim submitted by the complainant was analyzed and post scrutiny it was found that he was admitted in the treating hospital due to CLD, jaundice but the treatment revealed that the etiology found ethanol related which clearly reflected that he was a regular and heavy drinker. It was further pleaded that as such, the claim of the complainant was rightly repudiated as per the terms and conditions of the policy. The remaining allegations were denied being false.

4] The complainant filed rejoinder, wherein, he reiterated the averments made in the complaint and repudiated those as stated in the written version of the opposite part.

5] The parties led evidence in support of their respective cases before the District Commission.

6] The District Commission, after hearing the Counsel for the parties and going through the evidence on record, partly allowed the consumer complaint, as stated above, holding inter-alia that firstly, the appellant (opposite party) failed to prove that the respondent (complainant) was a chronic alcoholic and due to that only, he was admitted in the treating hospital for treatmen