Insurance claim – Repudiation for partial non-disclosure of material facts of other policies

On 9.6.2014, the father of the appellant had taken insurance policy for rs.25 lakhs.  However, he died in an accident on 19.8.2015.  The claim submitted by the appellant was repudiated vide letter dated 3.3.2016 of the Respondent for suppression of material facts relating to non-disclosure of other three insurance policies of Life Insurance Corporation.

HELD that the insured had disclosed Aviva policy for Rs.40 lakhs.  The Respondent – Insurer was aware of the capacity of insured to pay premium of another insurer. However, other three LIC policies of aggregate of Rs.2,30,000/- were not disclosed.  Thus, there was partial disclosure.  The failure to mention about other policies does not amount to a material fact in relation to the policy availed and consequently, the claim could not have been repudiated.

We are of the considered view that such a failure would not influence the decision of a prudent insurer to issue the policy.   The policy in question is not a Mediclaim policy; it is a life insurance cover and the death of the deceased has taken place on account of an accident.  Accordingly, failure to mention about other policies does not amount to a material fact in relation to the availed policy.

Judgment dated 25.2.2025 of the Supreme Court of India in SLP [Civil] NO.2136 of 2021 of Mahaveer Sharma  Vs.  Exide Life Insurance Company Limited and another