SBI Life’s ‘hidden illness’ claim fails, drowning victim’s widow gets Rs 40 lakh

Rs 40 lakh claim vs health-history 

Komara Nanaji Rao had obtained an SBI Life “eShield Insta Plan A Policy” on October 23, 2024, for a sum assured of Rs 40 lakh. The premium was deducted from his savings bank account. His wife was admittedly the nominee under the policy.

The woman claimed that on the night of January 27, 2025, when her husband was on a motorcycle, traveling to Uppada, a coastal beach in Kakinada district in Andhra Pradesh, he accidentally fell into canal waters near Narrow Bridge, Suryaraopeta, Kakinada Rural Mandal. His body was recovered the next day, and an FIR was registered by Thimmapuram Police Station. 

The autopsy conducted by the Department of Forensic Medicine and Toxicology, Rangaraya Medical College, concluded that the cause of death was “asphyxia as a result of drowning”, and the chemical examiner confirmed a positive diatom test. After investigation, the police found no foul play and dropped further action. 

The wife submitted the insurance claim along with the required documents. Insurer SBI, however, repudiated the claim through a letter dated October 30, 2025, alleging that the husband had suppressed material facts relating to diabetes mellitus and hypertension while answering the health-related questions in the proposal form. The premium amount of Rs 6,898 was thereafter refunded. 

The wife, on the other hand, contended that the claim rejection was arbitrary, unjustified and amounted to deficiency in service and unfair trade practice, particularly when the death was accidental, and there is no evidence the medical conditions caused or contributed to the husband’s death.

SBI’s ‘hidden illness’ argument rejected 

SBI Life submitted that when the man had purchased the policy, he had specifically answered in the negative to questions concerning diabetes mellitus, high blood sugar and high/low blood pressure. But during the investigation carried out when the claim was sought, his medical records were stated to have shown he had been suffering from diabetes mellitus and hypertension and had undergone treatment before the proposal. 

Relying on the prescription, hospital records and pathology reports, SBI contended that the husband deliberately suppressed material facts. They invoked the doctrine of utmost good faith provided in the relevant provisions of the law and argued that, had the true medical condition been disclosed, the proposal would not have been accepted.

The consumer body ordered the payout after deducting the unpaid premium subject to the terms of the policy, resulting in a net amount of Rs 39.87 lakh along with 9 per cent from October 31, 2025. The commission also directed SBI to pay Rs 1.05 lakh towards compensation and costs.

Takeaway

The ruling highlights that mere production of some medical records showing that the deceased had been prescribed medicines or had recovered from elevated blood sugar or blood pressure does not, without more, conclusively establish that the late husband made a false declaration with the intention of suppressing a material fact.

For consumer-related grievances, individuals may contact the consumer helpline in their respective states and Union territories (Andhra Pradesh: 1800-425-0082 ) or call the National Consumer Helpline at 1915 for assistance.  

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