ICU doctor dies on duty, his widow wins Rs 50 lakh insurance claim

Holding that insurers cannot defeat genuine claims by relying on vague and ambiguously drafted proposal forms, a consumer body in Andhra Pradesh has directed HDFC Life Insurance Company to pay Rs 50 lakh to the widow of an ICU doctor who died of a sudden cardiac arrest while on duty, ruling that the alleged non-disclosure of other insurance policies had no proven bearing on either the assessment of risk or the cause of his death.

A bench of president Karanam Kishore Kumar and members N Narayana Reddy and S Nazima Kausar of the Kurnool District Consumer Disputes Redressal Commission was hearing a complaint filed by Bonthala Sindhuja against HDFC Life Insurance Company.

The commission was examining whether the insurer was justified in repudiating a death claim on the ground that the deceased had failed to disclose existing life insurance policies issued by other insurers. “Any ambiguity in the questionnaire must necessarily be construed against the insurer, who is the author of the document… In the absence of proof of materiality and intentional suppression, the repudiation cannot be sustained,” the commission said on June 1.

The commission found that while the insurer relied on alleged suppression of existing insurance policies, it failed to establish that the omission was material to the underwriting decision or had any nexus with the doctor’s natural death due to cardiac arrest. It consequently directed the insurer to pay the policy amount, compensation and litigation costs.

The complainant, Bonthala Sindhuja, is the wife and nominee of late Dr G Sravan Kumar, an anaesthesiologist who worked as an ICU duty doctor at Aadya Multi Speciality Hospital in Kurnool. According to the complaint, Dr Kumar purchased an HDFC Life Click 2 Protect Super Policy with a sum assured of Rs 50 lakh. The policy commenced on October 15, 2022, and an annual premium of Rs 11,478.28 was paid.

On the night of February 16, 2024, Dr Kumar reported for his regular night duty. During the early hours of the morning, after going to the duty room for rest, hospital staff found him unconscious. Fellow doctors examined him but he was declared to be dead. The family was informed that he had suffered a severe heart attack while resting during duty.

After learning about the insurance policy, Sindhuja submitted the death claim along with all supporting documents. However, HDFC Life rejected the claim through a letter dated May 22, 2024, alleging that the insured had failed to disclose other life insurance policies while filling the proposal form.

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A review before the insurer’s claims review committee was also rejected on June 22, 2024. Aggrieved by the rejection, Sindhuja approached the consumer commission seeking payment of the insured amount along with compensation.

Insurer’s defence

HDFC Life argued that Dr Kumar had already obtained other life insurance policies, including one from Bharti AXA Life Insurance Company and another from Kotak Life, but failed to disclose them while applying for the HDFC policy.

According to the insurer, had these existing policies been disclosed, the proposal would not have been accepted. It argued that insurance contracts are founded on the principle of utmost good faith and any suppression of material facts entitled the insurer to repudiate the policy. The company maintained that its investigation established the existence of undisclosed policies and, therefore, there was no deficiency in service on its part.

Widow’s arguments

The complainant contended that the repudiation was arbitrary and illegal because the alleged non-disclosure had absolutely no connection with the cause of death. She argued that her husband died due to sudden cardiac arrest and not because of any undisclosed illness or medical condition.

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She further submitted that the mere existence of another insurance policy could not automatically become a ground for repudiating a genuine claim unless the insurer established fraudulent suppression of a material fact that actually influenced the underwriting decision. The complainant also argued that the insurer’s rejection letters were vague and lacked proper reasoning.

Commission’s findings

The insurer itself had drafted ambiguous questions regarding previous insurance policies. The form asked if the proposer had an existing HDFC Life policy but did not clearly require disclosure of policies issued by other insurers.

Questions under ‘Previous Policy Details’ were in technical language and did not contain a direct query on whether the proposer held any life insurance policies with other companies. Because the form lacked clarity, the proposer’s answers could not automatically be treated as deliberate suppression of material facts.

It further held that Section 45 of the Insurance Act places a stringent burden on insurers to establish that any alleged suppression was material, fraudulent and made knowingly, before a policy can be repudiated.

There was nothing to suggest any suspicious or unnatural circumstances surrounding the death. HDFC Life failed to establish that the alleged non-disclosure had any bearing either on the risk assessment or on the actual cause of death.

The insurer’s claims review committee was criticised for merely affirming the earlier repudiation without dealing with the complainant’s specific contentions.

Supreme Court ruling relied upon

The commission relied on the Supreme Court’s judgment in Mahaveer Sharma vs Exide Life Insurance Company Limited delivered on February 25, 2025. It observed that while insurance contracts are governed by the principle of utmost good faith, repudiation cannot automatically follow merely because all previous insurance policies were not disclosed.

The Supreme Court had held that the insurer must establish that the alleged omission was material enough to influence its decision to issue the policy. Finding the present case to be similar, the commission applied the same principle.

Final directions

Allowing the complaint in part, the commission directed HDFC Life Insurance Company to jointly and severally pay the insured amount of Rs 50 lakh to the complainant, Rs 50,000 as compensation for mental agony and Rs 10,000 towards litigation costs.

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The commission directed that the amounts be paid within 45 days of receipt of the order. If the insurer fails to comply within the stipulated period, the awarded amount will carry 12 per cent annual interest from January 24, 2025, the date of filing of the consumer complaint, until realisation.

Significance

The ruling reinforces that insurance companies cannot reject genuine claims by relying on vaguely worded proposal forms or technical omissions unless they prove that the alleged non-disclosure was deliberate, material and had a direct bearing on the underwriting decision.

By applying the principle that ambiguities in insurance contracts must be interpreted against the insurer, the commission strengthens consumer protection and signals that policyholders and their families should not be deprived of insurance benefits through unclear questionnaires or mechanical claim repudiations.

Consumers facing similar grievances may contact the consumer helpline in their respective states (Andhra Pradesh: 0866-2551431) or dial the National Consumer Helpline at 1915 for assistance.