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Earlier people lived their lives in the present and were least concerned with the future.

Consumer Rights & Insurance - Mukund (1)


Earlier people lived their lives in the present and were least concerned with the future. But nowadays we see that people are more concerned about the happening or inevitable events that can happen in the future. This is basically due to increased expenses that a person might be subjected to due to future inevitable events. These include health-related risks, Damages to your expensive car, fire in Warehouse or offices, etc. Therefore, to rescue an individual from such huge expenses, nowadays we have huge Private Companies which provide insurance concerning different risks that you might be prone to. These private companies to increase their profits and escape liability under an insurance contract, try to deceive the general public with the use of different means or tactics what we say.  Although insurance is a contract in the true sense, its broadened definition and more people taking insurance, Consumer Protection Rights with respect to insurance are provided to all such people taking insurance these days.


Health insurance is one of the most subscribed insurance among all. With the advent of increasing expenses and bills associated with hospitals, a large population be in middle-income countries or higher-income countries are taking health insurance. Although countries like India and Columbia are trying to achieve universal coverage to all the people using schemes and subsidies, yet a huge chunk of the population in these countries takes the help of private companies. Private Countries try to waive their liability by the following means-

  • Restricting a particular insurance policy to a selected group of people who have less health risk seeing the medical history of such individual
  • Providing for a waiting period for covering some fatal ailments and diseases.
  • Providing for various kinds of terms and conditions which usually gets unnoticed by the customers.
  • Strict norms and direction with respect to renewing a previous policy.
  • Limited period to seek Redressal and insurance claim

However, the person applying for insurance should as well keep in mind certain provisions that are ignored by them resulting in no insurance benefit to these individuals.

Supreme Court of India in KP Desai Vs United India Insurance Company held that the insurance company would be waived off its liability if the insurance policyholder undergoes any treatment to beautify himself which is not concerned with any sort of ailment or disease like plastic surgery, eye surgery, etc. 


Civil court and Consumer courts both have jurisdiction to take up disputes relating to an insurance claim. The civil court comprises approximately 600 district courts, 25 high courts, and the supreme court. A person can initiate a suit under this court depending upon the hierarchy and geographical jurisdiction of the suit being filed.

Consumer Courts comprise roughly of District Consumer Dispute Redressal Commission (DCDRC), the State Consumer Dispute Redressal Commission (SCDRC), and the National Consumer Disputes Redressal Commission (NCDRC). DCDRC can take up the matter of amount up to 1 crore and SCDRC can take up matters of the amount in between 1 crore and 10 crore and appeals from District commission. While NCDRC has pecuniary jurisdiction to take up all matters exceeding 10 crore and appeals from state commissions.


Beneficiaries under an insurance policy are CONSUMERS under the Consumer Protection Act

In Canara Bank vs United Indian Insurance Corporation and Ors., the Court held that all those persons which act as beneficiaries of an insurance policy are consumer itself under the consumer Protection Act, irrespective of the fact whether they are parties to the contract of insurance.

Insurance Claim could not be rejected solely based on technical grounds

In Om Prakash v Reliance General Insurance, the supreme court held that denial of insurance claim by the insurance company solely based on technical grounds is against the right of the insured. In this case, the company denied the insurance claim on the truck being stolen to the owner of the truck who had taken an insurance policy for his truck. The reason being that the insured need to inform about the loss of the insured good immediately and here the insured told the insurance company about the same after a week. Hence the court held that the company is liable to pay the insured the insurance claim.

The Limitation Provision under Consumer Protection Act must not be so strictly followed that it disadvantages a consumer to a great extent

In National Company Ltd. V Hindustan Safety Glass Works Ltd. & Anr., the Supreme court held that the limitation period should be followed to the extent that it does not disadvantage a consumer. In the said case, the insurance company denied the claim as a period of one year passed before which the consumer can file for a claim. However, the said delay was caused by the National Insurance to ascertain the amount of loss incurred. Therefore, the court made the insurance company liable for an insurance claim.

Exclusionary Clause would only be applicable if the insured is duly informed about the same at the time of taking an insurance policy

In New India Assurance Co. Ltd V Paresh Mohanlal Parmar, the supreme court held that the exclusionary clause would only be applicable in case the said clause is duly informed in advance to the insured. Contrary to this, the exclusionary clause won’t be applicable. An exclusionary clause is one using which the insurer could waive its liability for a particular eventuality.


We must learn from the western countries on few aspects which are quite necessary for every country. Health is an important aspect and function to the state to look into, there should be the availability of state-sponsored Standard health insurance for all the citizens. India and Columbia are implanting the same to great extent and working to achieve their goals.

Presence of proper and structured Consumer Protection Mechanism after the 2019 Consumer Protection Act so that disputes about insurance and other sectors are solved in minimal time and the best possible manner.


As we are moving forward towards technological advancement, e-insurance has emerged to a great extent. Now we could have our vehicles and health insured by the few clicks on our mobile. But with this comfort comes a lot of legal hazels which need to be seen and taken care of in the long run. Although the 2019 Consumer Protection Act has broadened its aspect for e-commerce, yet we still would require a detailed and structured law in that aspect too.

Author(s) Name: Mukund Agarwal (Symbiosis Law School, Pune)



  1. Consumer Protection Act, 2019

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