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A Mohanty (Engineer)     20 October 2010

Need Advise to Challenge Insurance Claim Repudiation

Hi All. My Father had taken a life insurance policy from ICICI Pru in Feb/2007. The insurance Agent was aware of his pre-existing lever disease. However he did not record that in the policy documents. As a standard practise my father had done the required signatures and rest of the document was filled up by the agent himself. Regular payments have been made towards the policy over the entire payment term (3 years in this case). My father passed away in June,2010. Since then we have been chasing ICICI Pru to process the claim. After 3 months we got a response from them that

1) pre- existing disease was not disclosed at the time of taking the policy [To which we responded saying that the agent was aware of the fact and we could not be blamed if he did not mention the same in the policy documents]

2) Insured should have reviewed the policy and approached the insurer within 15 days from receiving the bond copy.

3) The policy could be repudiated under Insurance act 1938, section 45 (non disclosure of fact). However as a goodwill we will be paid back only the premium paid.

As per my understanding of act 1938, policy can not be questioned after 2 years from the date of policy commencement. Please advise what should I do in such a scenario? Is repudiation valid? Or should I approach the IRDA or Consumer court? What proofs do I need to produce? What is the success rate of such cases?

Timely response would be highly appreciated. Thanks.


 11 Replies


first approach insurance ombudsman in IRDA on line

adv. rajeev ( rajoo ) (practicing advocate)     21 October 2010

Issue legal notice to the ICICI ins. to settle the claim, otherwise file a consumer complaint, it comes under consumer act.  And before that try the advise given by Reddy Sir,

A Mohanty (Engineer)     21 October 2010

Thanks to all for the response. I studied a bit of the Insurance act 1938 sec 45 and understand that

"No question can be raised on the policy by the insurer after 2 years from the commencement of the policy, unless the Insurer has enough proof that information was not disclosed purposefully by the Insured at the time of enrolling into the policy".

At the time of enrollment no health checkup was done, so there is nothing on papers. My father just verbally communicated to the agent about his health status. Only when we approached ICICI Pru for settlement, they took 3 long months to collect from us the Old reports about pre existing disease (calling it as a Mandatory procudure to submit all these medical reports. Now they are saying that they have our old medical reports which shows that My father had chronic lever disease and we did not declare that. Hence they could repudiate the policy as a fraud claim.


Please let me know the consequences of winning/loosing the case with


2) Consumre court

I want to be very cautious before proceeding as do not want to get trapperd again. Please advice me as I am very new to the 'Legal' matters. Thanks again.



Amardeep Srivastava (Senior Law Officer)     26 October 2010

I feel that the chances of the case going in your favour are very remote. Pre existing disease was not disclosed in the application form. Even if the form was filled by the agent, signatures thereon of the policy holder confirms that the policy holder agrees to every detail mentioned therein. Subsequently in your correspondence you have also acknowledged that there was a disease that existed at the time of application though you blame the agent for not disclosing the same in the application form. Complete disclosure is a very basic requirement of an insurance policy. The only way to help yourself in this case would be to bring in the evidence of the insurance agent, which is not likely to happen, who should confirm that the said information was disclosed by you and was missed inadvertently.

Sure Shot Commodity Tips (SEO)     27 October 2010

In some cases these days, the distinction between Broker and Insurer has unfortunately become "blurred", especially when Brokers act in respect of "scheme" policies in which Special Accident, Medical, Funeral or other cover is offered under a sort of blanket cover issued (in small print), in conjunction with XYZ Insurance Company. In this sort of case, if the Brokers convey the repudiation, get them to confirm that they do so on the Insurer's instruction, and that the terms of their letter carry the authority and approval of the Insurer.

Sure Shot Commodity Tips


As stated by Mr. Rajoo initiate the further proceedings and apart from you can file a suit for recovery of money based on the maturity or on death claim before a civil court.  Since it is a contract of indemnity.  You can also claim further damages in this aspect.

SANJAY JOIL (LAW STUDENT)     29 November 2010

Mr. Mohanty, agent was knowing everything can not be an excuse in your case as your father has signed the proposal form accepting all the terms and conditions.  However,  your case is strong as the death has occurred after  two years.  Contact  insurance ombudsman within one year you will get justice.  Pls refer following links for  further help.At the same time , note that the insurer entitled to investigate the matter in case of death in  any year if he has doubt., however after two years he can not repudiate the claim on the grounds of suppression of material facts.  Further if the cause of death of your father is very same disease, then only the insurer can repudiate the claim within TWO YEARS.

Kumar Doab (FIN)     05 December 2010

The company has obtained the medical records) documents ( Material Evidence) from you and used them against you. It might be mandatory for the company to collect past medical records as per their internal process applicable to employees of the company, but not for the family.Family of the deceased usually accede to all the demands of the company.

Company has to inform the investigation within 30 days and complete within 6 months.

In case of ICICI Pru Life and other Life insurance companies majority of the proposal  forms are filled by the agent.This is used as a routine matter so that the adverse information which can lead to " Medical Checkup" or by which the issue of policy cab be declined, is not disclosed. The agents or Agency Managers sometimes collect the policy bond from customer on one pretext or another and return it after the free look period  is over.

IRDA has also issued instructions for the companies to call the prospect and cross check the information filled up in the proposal form.Usually companies hire third parties for this.Internally the employees of the companies including Executive assistant /Agency Manager / and even Branch Manager are also required to call and /or meet the prospect depending upon the size of premium and Sum Assured (SA), and after the contact they are supposed to enclose their report  in writing with the proposal form.

It is not only the agent but the company staff also involved in  documentation before the policy is issued.

Medical Check ups are mandatory if the proposer is above 55 years of age and /or the SA is >5 lac but this can vary from company to company.

You may use your resources to obtain all documents forwarded by the concerned branch with proposal from and their medical grid applicable at that time.

Operation staff of the some companies have access to the scanned image of all the docs .

Proposer can cancel the policy  within free look period of 15 days from the receipt of policy bond.

Your father has lived for  3 years after the issue of the policy.However the cause of death shall be what is declared in the Death Certificate by the doctor e.g if it Heart Attack then it is not Chronic Liver Disease.

You may show all documents to your lawyer and proceed accordingly.

SACHIN AGARWAL (ADVOCATE)     10 December 2010

I go with Mr. Amardeep Srivastava.

tufail qadri (advocate)     27 February 2011

i agree with Mr.Kumar Doab....death shall be from the pre existing disease...othrwise itz non disclosure is not material at this point in death has already taken place.....however repudiation of ur claim i advice u to challenge it before consumer court and ur chances of getting the claim amount along wid interst and even compensation r good.....but do engage a lawyer....bcoz eveidence is to be lead and under the supervision of lawyer ur adversaries defences will be countered in professional manner.

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