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2026 Supreme(Online)(SCDRC) 5036
STATE CONSUMER DISPUTES REDRESSAL COMMISSION
Sangita Dhingra Sehgal, President, Bimla Kumari, Member
Star Health And Allied Insurance Co. Ltd. – Appellant
Versus
Sonia Singh – Respondent
FIRST APPEAL NO.369/2025 | FA NO./369/2025
For the Appellants/Petitioners: Abhishek Nanda, Yashika Singh
For the Respondents: Shripal
An insurance contract is governed strictly by its defined terms; therefore, an insurer is justified in repudiating a claim if the insured violates a valid exclusion clause, such as obtaining treatment at a specifically de-listed hospital, or fails to comply with mandatory claim notification timelines.
Headnote:(A) Consumer Protection Act, 2019 - Section 35 - Health Insurance Policy - Repudiation of claim - Exclusion Clause - Treatment taken at an excluded provider - Appellant insurance company repudiated the claim on the ground that the hospital was specifically excluded from the policy and the intimation of the claim was delayed - Respondent contended that terms and conditions were not served at the time of policy inception - Court observed that the terms and conditions of an insurance contract must be construed strictly and that the insurer is entitled to repudiate if the insured acts in violation of specific exclusion clauses disclosed on the company’s website.
Facts of the case:
The respondent purchased a health insurance policy from the appellant and subsequently claimed reimbursement for treatment taken at a hospital classified as an 'Excluded Provider'. Further, the intimation of the claim to the appellant was made with a delay of 54 days.
Findings of Court:
The Commission found that the appellant had provided evidence regarding the hospital's exclusion status and the breach of the claim notification time frame. It further noted a pattern of repetitive claims involving the respondent’s authorized representative, indicating an attempt to circumvent policy terms.
Issues: Whether the repudiation of the insurance claim for treatment at an excluded provider and failure to provide timely intimation constitutes deficiency in service.
Ratio Decidendi: An insurance contract is a contract of utmost good faith governed strictly by its terms. If an insured deliberately seeks treatment in a facility specifically notified as an excluded provider and fails to comply with mandatory claim notification timelines, the insurer is justified in rejecting the claim.
Result: Appeal allowed; impugned order set aside.
| Table of Content |
|---|
| 1. summary of lower court record and initial case facts. (Para 1 , 2) |
| 2. positions of appellant and respondent regarding insurance policy terms. (Para 3 , 4) |
| 3. enforceability of exclusion clauses in insurance contracts. (Para 7 , 8 , 9 , 10 , 11 , 12) |
| 4. consequence of delay in claim notification and breach of policy conditions. (Para 13 , 14 , 15 , 16 , 17) |
| 5. principle of strict construction of insurance contracts. (Para 18 , 19 , 20) |
| 6. repetitive claims behavior and justification for claim repudiation. (Para 21 , 22 , 23 , 24 , 25) |
IN THE MATTER OF
STAR HEALTH AND ALLIED INSURANCE CO. LTD.
THROUGH ITS SENIOR MANAGER
1ST FLOOR, HIMALAYA HOUSE
23, KASTURBA GANDHI MARG
CONNAUGHT PLACE, New Delhi-110001
(Through Mr. Abhishek Nanda, Advocate)
…APPELLANT
VERSUS
MS. SONIA SINGH
B-4, 1ST FLOOR, J.J. COLONY
BHARAT VIHAR, KAKROLA
NEW DELHI
(Through Mr. Shripal, Advocate)
…RESPONDENT
CORAM:
HON’BLE JUSTICE SANGITA DHINGRA SEHGAL (PRESIDENT)
HON’BLE MS. BIMLA KUMARI, MEMBER (FEMALE)
Present: Ms. Yashika Singh, Counsel for the appellant
Mr. Shripal, Counsel for the respondent
PER :HON’BLE JUSTICE SANGITA DHINGRA SEHGAL, PRESIDENT
JUDGMENT
1. The facts of the case as per the District Commission record are as under:
“ 1. The present complaint has been filed under section 35 of the Consumer Protection Act, 2019 (in short CP Act) against Opposite Parties (in short OP) alleging deficiency of services.
”2. Briefly stated, the facts of the case are that the complainant had taken a health insurance policy bearing No. 11240670131400 from the Opposite Party on 31.01.2024, valid from 31.01.2024 to 30.01.2025, for a sum insured of ₹5,00,000/-. On 22.09.2024, the complainant visited RHTC Hospital, Government of India, Najafgarh, New Delhi, in an emergency (Reg. No. 98405). Subsequently, on 25.09.2024, the complainant visited Mahavir Multispecialty Hospital, New Delhi, in OPD. On the doctor's advice, the complainant was admitted in a serious condition.
3. It is stated that the complainant was diagnosed with Enteric Fever with UTI and Sepsis. The hospital generated a final bill of ₹2,44,072/-, which was paid by the complainant.
4. It is further stated that the complainant submitted a claim to the Opposite Party, which was rejected on 09.12.2024, citing that the treatment was taken from an "excluded provider (hospital).
5. It is alleged that the complainant sent a representation on 12.12.2024 to the Opposite Party, stating that no Excluded Provider List or related information was provided at the time of issuing the policy. Having no alternative remedy, the complainant is constrained to approach this Hon'ble Commission.
6. It is prayed to Direct the Opposite Party to pay ₹2,44,072/- with interest @ 18% p.a. from 09.12.2024 till realization. Further, Direct the Opposite Party to verify and produce the complainant's medical records and bills from 25.09.2024 to 02.10.2024. Any other order which this Hon'ble Court may deem fit and proper in the facts and circumstance of the case in favour of complainant and against the opposite party.
7. Notice of the complaint was issued to OP, pursuant to which OP appeared and filed written statement contesting the case on various grounds inter alia that complaint is false, frivolous, vague, baseless and misconceived. It is also alleged that complainant has not come with clean hands and has suppressed material facts. It is further alleged that the complaint is not maintainable without complainant availing the statutory remedy of Redressal machinery established under the Insurance Regulatory and Development Authority. It is also alleged that OP/Insurance Company rendered all possible services to the Complainant and there was/is no unfair trade practice or deficiency in service on the part of OP Insurance Company, hence the complaint is not maintainable.
8. It is contended that the complainant availed a Young Star Insurance Policy (Policy No. 11240670131400) for a sum insured of 25,00,000/- from the Opposite Party fo
