LexMAHAVEER SHARMA versus EXIDE LIFE INSURANCE COMPANY LIMITED & ANR.
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[2025] 2 S.C.R. 1311 : 2025 INSC 268 Mahaveer Sharma v. Exide Life Insurance Company Limited & Anr. (Civil Appeal No. 3562 of 2025) 25 February 2025 [B.V. Nagarathna and Satish Chandra Sharma,* JJ.] Issue for Consideration Whether there was any material suppression of fact on the part of the appellant’s father while obtaining an insurance policy or not. Headnotes† Consumer Disputes – Life insurance policy – Repudiation of claim, when not proper – Life insurance policy of Rs.25 lakhs was taken by the deceased (father of the appellant) – He died in an accident – Appellant’s claim was repudiated on the ground that there was material suppression by his father as he had disclosed only one other life insurance policy availed by him at the time of filing the proposal form, but failed to disclose other similar policies – Claim of the appellant, if was rightly rejected on account of suppression of material facts: Held: No – The disclosed policy was for Rs.40 Lakhs, an amount significantly more than the policies not disclosed and the sum assured by the subject policy herein – Thus, the insured had made a substantial disclosure inasmuch as he had disclosed that he had obtained another policy from a private insurer for Rs.40 lakh which was in force – The other policies were of inconsequential sum assured amounting to Rs.2,30,000/- – Such a failure would not influence the decision of a prudent insurer to issue the policy proposed – The substantial disclosure made was sufficient for a prudent insurer to determine the risk assumed – Further, the policy in question is not a Mediclaim policy; it is a life insurance cover and the death of the deceased had taken place on account of an accident – Thus, failure to mention about other policies does not amount to a material fact in relation to * Author 1312 [2025] 2 S.C.R. Supreme Court Reports the policy availed – Therefore, the claim could not have been repudiated by the respondent-company – Order repudiating the claim of the appellant and the orders of the National Commission and the State Commission, set aside – Respondent to release all benefits under the policy to the appellant with interest, as directed. [Paras 9, 18-20] Consumer Disputes – Insurance contracts – “material facts”; “material suppression” – What is: Held: An insurance is a contract uberrima fides – It is the duty of the applicant to disclose all facts which may weigh with a prudent insurer in assuming the risk proposed – These facts are considered material to the contract of insurance and its non-disclosure may result in the repudiation of the claim – The materiality of a certain fact is to be determined on a case-to-case basis – When a claim is repudiated on the ground that the policy holder has suppressed material facts in his application form w.r.t existing life insurance policies from other insurers, the burden is on the insurer to prove the allegation of non-disclosure of the material fact and that the non-disclosure was fraudulent – The burden of proving the fact, which excludes the liability of the insured to pay compensation lies on the insured alone and no one else. [Paras 12, 16] Case Law Cited Reliance Life Insurance Co. Ltd. & Anr. v. Rekhaben Nareshbhai Rathod [2019] 6 SCR 733 : (2019) 6 SCC 175; Satwant Kaur Sandhu v. New India Assurance Co. Ltd. [2009] 10 SCR 560 : (2009) 8 SCC 316; Mahakali Sujatha v. Branch Manager, Future Generali India Life Insurance Company Limited & Another [2024] 4 SCR 724 : (2024) 8 SCC 712 – distinguished. Manmohan Nanda v. United India Assurance Company Limited & Another [2021] 11 SCR 1138 : (2022) 4 SCC 582 – relied on. List of Keywords Life insurance policy; Material suppression of fact; Material fact; Insurance contract; uberrima fides; Repudiation of claim; Disclosed policy; Proposal form; Substantial disclosure; Private insurer; Failure to mention Other policies; Similar policies not disclosed; Inconsequential sum; Not a Mediclaim policy; Failure to mention; Life insurance cover; Prudent insurer. [2025] 2 S.C.R. 1313 Mahaveer Sharma v. Exide Life Insurance Company Limited & Anr. Case Arising From CIVIL APPELLATE JURISDICTION: Civil Appeal No. 3562 of 2025 From the Judgment and Order dated 28.05.2019 of the National Consumers Disputes Redressal Commission, New Delhi in FA No. 1963 of 2018 Appearances for Parties Advs. for the Appellant: Abhijeet Singh, Anirudh Singh, Ms. Chitrangda Rastravara, Dhananjai Shekhwat,
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