The Kakinada Consumer Commission has rejected SBI Life's argument regarding 'suppressed medical history' and ordered the insurer to pay nearly ₹40 lakh to a drowning victim's widow.

  • Kakinada District Consumer Commission ruled against SBI Life Insurance Co Ltd.
  • The insurer's claim of 'suppressed diabetes and hypertension' was found unsubstantiated.
  • SBI Life must pay ₹39.87 lakh plus ₹1.05 lakh in compensation and costs.

In a landmark ruling for consumer rights, the Kakinada District Consumer Dispute Redressal Commission in Andhra Pradesh has directed SBI Life Insurance Co Ltd to pay approximately ₹40 lakh to the widow of a man who died in an accidental drowning. The commission overturned the insurer's decision to repudiate the claim based on the allegation that the deceased had suppressed his medical history regarding diabetes and hypertension.

The Incident and Policy Details

The deceased, Komara Nanaji Rao, had secured an 'SBI Life eShield Insta Plan A Policy' on October 23, 2024, with a sum assured of ₹40 lakh. On the night of January 27, 2025, while traveling near Kakinada, Rao accidentally fell into a canal. The subsequent autopsy conducted by Rangaraya Medical College confirmed the cause of death as asphyxia due to drowning, and police investigations cleared any suspicion of foul play.

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Upon filing the claim, SBI Life rejected the application in October 2025, citing the 'Doctrine of Utmost Good Faith.' The company argued that medical records indicated the deceased was undergoing treatment for diabetes and hypertension, facts which they claimed were not disclosed in the proposal form.

Why This Matters

BozokMedia analysis shows that insurance providers frequently rely on minor medical discrepancies to avoid large payouts. This case sets a precedent that the mere existence of medical records or prescriptions does not automatically prove a fraudulent intent to suppress material facts, especially when the cause of death is unrelated to the alleged ailments.

The ruling reinforces that insurers cannot use medical history as a blanket excuse to deny claims unless a direct causal link to the death is established.

The commission, led by President Raghupathy Vasantha Kumar, found that the complainant had provided consistent evidence of an accidental death. The court noted that the insurer failed to prove that the non-disclosure was deliberate or intended to deceive, thereby causing the widow avoidable mental agony and financial hardship.

Financial Implications of the Verdict

The commission ordered SBI Life to pay a net amount of ₹39.87 lakh (after deducting the unpaid premium) along with 9% interest effective from October 31, 2025. Furthermore, the company has been directed to pay ₹1.05 lakh as compensation for costs and harassment endured by the victim's family.

Did You Know?: The 'Doctrine of Utmost Good Faith' requires both parties to disclose all material facts, but it cannot be used arbitrarily to deny valid accidental claims.

Frequently Asked Questions

1. Can an insurance company deny a claim if the deceased had a pre-existing condition?
Only if they can prove the condition was intentionally hidden and that it contributed to the cause of death.

2. Where can consumers file complaints against insurance companies?
Consumers can approach the District Consumer Dispute Redressal Commission or call the National Consumer Helpline at 1915.