A Mohali widow won a ₹1.05 crore life insurance claim after a 4-year legal battle, with the Punjab State Consumer Commission ruling the insurer failed to prove pre-existing mental illness
Mohali Woman Wins Life Insurance Claim After Legal Battle
A woman from Mohali has concluded a four-year legal battle to claim her late husband’s life insurance worth ₹1.05 crore. The insurer initially rejected the payout, citing a pre-existing mental illness.
The Punjab State Consumer Disputes Redressal Commission ruled in favor of the widow. The commission stated that the insurer did not prove its claim of pre-existing depression and schizophrenia.
The commission noted that the burden of proof lies with the insurer. It directed Max Life Insurance Company Ltd to pay ₹1.05 crore, plus interest, to the widow. The insurer must also pay ₹25,000 for harassment and litigation costs.
The commission emphasized that a death, even if alleged to be by suicide, does not prove a pre-existing mental illness without solid medical evidence.
Details of the Insurance Policies
| Policy Date | Sum Assured | Nominee |
|---|---|---|
| October 2017 | ₹1 crore | Wife |
| December 2017 | ₹5 lakh | Wife |
The complainant’s husband had two life insurance policies from Max Life Insurance Company Ltd. After his death on March 12, 2020, she submitted claims for both policies. However, Max Life rejected the claims on October 24, 2020, citing non-disclosure of material facts.
The insurer claimed the deceased had depression and schizophrenia before obtaining the policies. The widow filed a complaint with the consumer commission on August 10, 2021.
Max Life argued that the insured concealed his medical condition and gave incorrect health information when purchasing the policies. The insurer relied on reports obtained after the insured’s death and invoked the suicide exclusion clause in the policy documents.
The commission, led by President SK Aggarwal and member Paramjeet Kaur, reviewed the evidence and documents from all parties. It found that the insurer did not provide any hospital records or medical documents to support its claims.
The commission noted that Max Life had conducted thorough medical examinations before issuing the policies. These included physical assessments and blood tests. The commission stated that issuing the policies indicated acceptance of the insured’s health status by the insurer.
President SK Aggarwal stated that once an insurer issues a policy after medical examinations, it cannot later reject a claim based on unproven allegations. The commission also ruled that the suicide exclusion clause did not apply, as the insured’s death occurred more than 12 months after the policies began.
As a result, the commission ordered Max Life Insurance Company Ltd to pay ₹1 crore and ₹5 lakh for the two policies, with interest at 6% per annum from the date of the complaint.
