Holding that an accidental death insurance claim cannot be denied merely because the insured had an unrelated pre-existing illness, the national consumer disputes redressal commission (NCDRC) has directed Manipal Cigna Health Insurance Company Ltd to honour two personal accident insurance policies worth a combined ₹40 lakh. The commission ruled that the insured's earlier breast cancer had no nexus with her death in a road accident and, therefore, could not be used as a ground to repudiate the claim.
A bench of presiding member Dr Inder Jit Singh and member Shashi Nandkeolyar dismissed the insurer's second appeal, affirming the concurrent findings of the district consumer disputes redressal commission-II and the state consumer disputes redressal commission, Chandigarh, which had directed payment of the insured amount along with interest and compensation.
Loan-linked Accident Insurance
According to the order, complainant Nakshattar Singh Sohal and his wife, Parminder Kaur, had availed a housing loan of ₹37.40 lakh from Indiabulls Housing Finance Ltd. While sanctioning the loan, they were introduced to an authorised representative of Manipal Cigna Health Insurance and purchased two accident insurance policies with sums insured of ₹25 lakh and ₹15 lakh, respectively, each valid for three years.
On 17 January 2018, the couple met with a road accident while travelling from Hisar to Amritsar. Kaur suffered severe head injuries and remained under treatment at multiple hospitals. After nearly three-and-a-half months of treatment, she succumbed to her injuries on 3 May 2018. Her husband thereafter submitted claims under both accident insurance policies.
Insurer Repudiated Claim Citing Breast Cancer
Manipal Cigna Health Insurance rejected both claims on 3 November 2020, contending that Ms Kaur had failed to disclose that she had been diagnosed with invasive duct carcinoma with nodal metastasis (breast cancer) in 2014 while purchasing the policies.
The insurer argued that suppression of this material fact violated the principle of utmost good faith and rendered the policies void. It further contended that the death was not 'solely and directly' caused by the accident because the deceased had suffered cardiac arrest and hypoxic ischaemic encephalopathy during treatment, thereby breaking the causal chain between the accident and death.
Consumer Commissions Ruled for Complainant
The district consumer commission partly allowed the complaint in July 2025, directing the insurer to pay the insured amounts of ₹25 lakh and ₹15 lakh together with interest at 6%pa (per annum) from the date of repudiation, besides ₹10,000 towards compensation and litigation expenses.
In November 2025, the Chandigarh state consumer commission dismissed the appeal filed by Manipal Cigna Health Insurance, holding that the post-mortem report clearly recorded 'head injuries' as the cause of death and that the alleged non-disclosure of breast cancer had no connection with the accidental death. It also imposed costs of ₹20,000 on the insurer.
NCDRC Finds Clear Causal Link between Accident and Death
Before NCDRC, Manipal Cigna Health Insurance argued that there was a significant gap between the initial treatment and subsequent hospitalisation, and that the intervening medical complications severed the causal connection required under the accident policy.
Rejecting the argument, the commission held that the insurer had relied on a fragmented reading of the medical records while ignoring the continuous course of treatment.
It observed that the post-mortem report unequivocally identified 'head injuries' as the cause of death, while the CT scan report, discharge summaries and other medical records consistently established that the deceased had been undergoing treatment for injuries sustained in the accident. The cardiac arrest occurred during that treatment and did not constitute an independent cause breaking the chain of causation, the commission held.
The bench also distinguished the Supreme Court's judgment in Haseena vs United India Insurance Co Ltd, noting that, unlike that case, the present matter contained clear medical evidence establishing a direct nexus between the accident and the death. It further held that Manipal Cigna Health Insurance's reliance on a criminal law judgement regarding the evidentiary value of post-mortem reports is misplaced in consumer proceedings.
Breast Cancer Unrelated to Accidental Death
The commission devoted considerable attention to the insurer's allegation that the insured had concealed her earlier breast cancer.
Examining the proposal form, it found that the medical questionnaire only sought information about physical disabilities affecting mobility or senses, treatment for conditions such as polio, arthritis, gout, paralysis or epilepsy, and hazardous occupations. It did not specifically ask applicants to disclose breast cancer or similar illnesses.
Consequently, NCDRC held that the insured had truthfully answered every question asked in the proposal form and could not be faulted for failing to disclose information that had never been sought.
The commission further observed that the exclusion clause relating to pre-existing diseases applied only where such diseases caused death or disability.
"In the present case, the cause of death is 'head injuries' and not breast cancer. Therefore, the exclusion clause is not attracted," the commission held.
It further noted that the product in question was purely an accidental death and disability policy and not a health insurance policy covering natural deaths. Therefore, non-disclosure of an unrelated disease had no bearing on an accidental death claim.
Supreme Court Precedents Support Complainant
NCDRC relied upon the Supreme Court's decision in Sulbha Prakash Motegaonkar vs Life Insurance Corporation of India, which held that repudiation of an insurance claim is unjustified where the alleged concealment has no connection with the cause of death.
The commission also referred to its own earlier decisions in Pratibha Bevinal vs MetLife India Insurance Co Ltd and Neeta Singh vs HDFC Standard Life Insurance Company, where insurance claims arising from road accidents were allowed, despite undisclosed pre-existing ailments because those ailments were unrelated to the accidental deaths.
The commission dismissed the insurer's contention that the insured violated policy conditions by taking discharge against medical advice (LAMA), observing that the policy did not make payment contingent upon strict compliance with every medical recommendation. It noted that the family made the decision after treatment at several hospitals and a poor medical prognosis.
It also rejected allegations regarding discrepancies in the post-mortem report concerning the husband's name after accepting documentary evidence showing that the deceased had remarried following the death of her first husband. The commission observed that this discrepancy had never formed part of the insurer's repudiation letter and, therefore, could not later be relied upon to defeat the claim.
The insurer's plea that the complaint was barred by limitation was similarly rejected, with the commission noting that the insurer had examined and repudiated the claim on the merits, thereby waiving any objection relating to delay.
Insurance Amount to First Clear Housing Loan
During the proceedings, the commission was informed that the housing loan had subsequently been assigned to another asset reconstruction company and that more than ₹62 lakh remained outstanding.
Accordingly, NCDRC directed that the insurance proceeds payable under the policies should first be utilised for the settlement of the outstanding housing loan, with any balance thereafter to be paid to the complainant.
Finding no jurisdictional error, patent illegality or material irregularity in the concurrent findings of the district and state consumer commissions, NCDRC dismissed Manipal Cigna Health Insurance's second appeal and directed the insurer to comply with the district commission's order within 30 days, failing which the decretal amount will carry interest at 9%pa.
(Second Appeal No28 of 2026 Date: 24 July 2026)
