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2026 Supreme(Online)(SCDRC) 5039
STATE CONSUMER DISPUTES REDRESSAL COMMISSION
Sangita Dhingra Sehgal, President, Bimla Kumari, Member
Star Health & Allied Insurance Co. Ltd. – Appellant
Versus
Menka – Respondent
FIRST APPEAL NO. 618/25
For the Appellants/Petitioners: Abhishek Nanda, Yashika Singh
For the Respondents: Shripal
Insurance contracts must be strictly construed based on their terms. Repudiation of a claim is valid when it is based on clear policy exclusions, such as 'excluded hospitals' notified to the insured, and when the insured fails to adhere to mandatory terms like the timely notification of a claim.
Headnote:(A) Consumer Protection Act, 2019 - Sections 2(11), 2(47), 35 - Insurance Contract - Excluded provider - Repudiation of claim - Claim filed for medical reimbursement denied by insurer on grounds that hospital was an excluded provider and notice of claim was delayed - Insurer demonstrated that hospital was listed on its website as excluded and intimation was made beyond the 24-hour limit defined in policy - Evidence suggested abuse of legal process as the representative of the claimant was involved in a systematically repeated series of claims against various insurers. (Paras 10, 14, 22, 23)
Facts of the case:
The respondent purchased a health insurance policy and sought reimbursement for hospitalization expenses incurred at a specific hospital. The appellant repudiated the claim on the grounds that the hospital was an excluded provider and that the claim intimation was delayed beyond the mandatory 24-hour window prescribed in the policy conditions. The District Commission initially found in favour of the respondent, leading to this appeal.
Findings of Court:
The Commission found that the terms and conditions of an insurance contract are binding and must be strictly construed. The evidence established that the hospital was indeed on the excluded list and the respondent failed to comply with the notice period requirement.
Issues: Whether the repudiation of the insurance claim by the appellant based on the excluded provider policy condition and failure to provide timely intimation was justified.
Ratio Decidendi: An insurance contract is a contract strictly governed by its terms. If a hospital is specifically excluded, as notified on the insurer's website, and the insured fails to adhere to the notice requirements for claims, the insurer is within its rights to repudiate such claims. Furthermore, evidence of habitual filing of dubious claims by a common representative suggests an abuse of the legal process.
Result: Appeal allowed; Impugned order set aside.
| Table of Content |
|---|
| 1. summary of lower court findings and case history. (Para 1 , 2) |
| 2. arguments presented by appellant (insurer) and respondent (insured). (Para 3 , 4) |
| 3. policy terms regarding 'excluded providers' are binding and admissible. (Para 7 , 8 , 9 , 10 , 11 , 12) |
| 4. violation of notification conditions (24-hour limit) renders the claim invalid. (Para 13 , 14 , 15) |
| 5. strict construction of insurance contract terms without equity exceptions. (Para 16 , 17 , 18) |
| 6. systematic filing of fraudulent claims constitutes abuse of legal process. (Para 19 , 20 , 21 , 22 , 23 , 24) |
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 is filed under Sections 35 of the Consumer Protection Act, 2019 against the Opposite Party for deficiency in service.
2. Brief facts of the case are that the complainant purchased an online Health Insurance Policy No. P/160000/01/2024/005123 from the Opposite Party on 08.08.2023, valid till 07.08.2024, for a sum insured of ₹10,00,000/-.
3. It is stated that the complainant was hospitalized at Prasad Health Care from 21.06.2024 to 29.06.2024 for treatment and paid towards medical expenses.
4. It is stated that the complainant submitted a claim before the Opposite Party, but the same was repudiated on 26.07.2024, stating that “hospitalization was not warranted and could have been managed on an outpatient basis.”
5. It is stated that the complainant submitted a representation on 18.09.2024, but no response was received.
6. It is alleged that the Opposite Party failed to provide the complainant with the policy booklet, hospital list, or proper guidance regarding exclusions.
7. It is stated that the complainant’s claim was genuine, and the rejection is arbitrary and amounts to deficiency in service.
8. Being aggrieved by the arbitrary and unlawful actions of the opposite party, the complainant has preferred the present consumer complaint, praying for the following reliefs:
a) Direct the Opposite Party to pay the complainant ₹68,250/- towards medical expenses along with interest @ 18% p.a. from 06.07.2024 till realization.
b) Direct the Opposite Party to produce the complainant’s treatment and claim records for verification.
c) Award litigation costs and compensation for mental agony.
d) Pass such other or further order(s) as this Hon’ble Commission may deem just and proper in the facts and circumstances of the case.
9. 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.
10. It is contended by the OP that the Learned Commission lacks jurisdiction to adjudicate the present matter, as it involves complex facts and pleadings requiring detailed examination and cross-examination, rendering it in the nature of a civil dispute. Hence, the complaint is not maintainable and deserves dismissal. The complaint filed by the Complainant is false, frivolous, vague, baseless, and misconceived, having been filed with suppression of material facts and without clean hands; therefore, no relief can be granted.
11. It is stated that the Complainant has not availed the statutory redressal mechanism provided under the IRDA (Protection of Policyholders’ Interests) Regulations, 2002. The complaint is thus premature, vague, and legally untenable, and liable to be dismissed on the ground of availability of an alternative statutory remedy.
12. It is contended that the complaint has been filed with mala fide intent and ulterior motive to extract an unlawful amount from the Respondent Insurance Company. It is not maintainable in law and deserves outright dismissal.
13. It i
