If your health insurance claim was rejected citing “non-disclosure of pre-existing disease”, you are not finished. Indian law gives you two strong shields, the §45 Insurance Act two-year incontestability rule and the new IRDAI eight-year moratorium under the Master Circular on Health Insurance Business dated 29 July 2024. Most rejections fall apart once these are invoked in writing with the right evidence and the right ladder of complaints.
Quick answer (do this in the next 30 minutes). Get the rejection in writing with the exact clause cited. Pull your policy bond, proposal form, KFD and premium receipts. Count completed renewal years: if 8 or more, the IRDAI moratorium blocks contestation except for proven fraud. If the policy is more than 2 years old, §45 Insurance Act shifts the burden of proof to the insurer. Email the insurer Grievance Officer the same day, then file on Bima Bharosa, then Insurance Ombudsman, then consumer commission via edaakhil. Keep every document.
A PED rejection is when an insurer repudiates a health claim on the ground that the policyholder failed to disclose a pre-existing disease at the proposal stage. Under the IRDAI Master Circular on Health Insurance Business, 29 July 2024, a PED is any condition diagnosed by a physician, or for which medical advice or treatment was recommended, within 36 months before the policy started.
A family member was admitted at [Hospital Name] for a cardiac event 14 months after [Your Name] bought a floater from [Insurer Name], policy [Policy Number]. The claim of ₹4,72,000 was rejected. Reason cited: “patient is a known case of diabetes for 18 months, not disclosed at proposal stage”. The diabetes had been picked up during a routine wellness camp run by [Your Name]'s prior employer, no medication was started, the family never thought of it as a “disease”. The insurer relied entirely on a single phrase in the hospital admission form. On reconsideration, with §45 invoked plus a treating-doctor certificate clarifying that no chronic medication had been prescribed, the insurer paid ₹4,38,500 plus ₹14,200 interest within 47 days.
Section 45 of the Insurance Act 1938, after the 2015 amendment, is the citizen's single most powerful shield in health and life insurance disputes. The text is dense but the citizen reading is simple.
Rule. No policy of insurance, life or health, can be called into question after 2 years from the date of issuance, renewal, or reinstatement on the ground of misstatement or suppression of fact, except where the insurer can prove fraud.
What “fraud” means under §45. Three elements must be proved by the insurer, not assumed:
Burden of proof shifts. Before 2 years, the insurer can repudiate on any material non-disclosure. After 2 years, the burden is on the insurer to establish fraud with documentary evidence. LIC v Asha Goel (2001) and Sulbha Motegaonkar v LIC (2015) confirm that suspicion, inference from hospital records, or hearsay from family members will not suffice.
Material fact doctrine. A fact is “material” only if it would have changed the underwriting decision. Borderline readings, single elevated values, family history, asymptomatic conditions, and self-medication generally do not qualify. Branch Manager, Bajaj Allianz v Saurabh Prakash (2006) restricts the doctrine to facts within the policyholder's actual knowledge.
Practical takeaway. Once your policy crosses 24 months, write to the insurer's Grievance Officer quoting §45 and demanding either documentary proof of fraud or payment with interest.
The “material” trap. Insurers often label any omission as “material” to push the case into the §45 fraud exception. The courts have narrowed this. In Reliance Life v Rekhaben Nareshbhai Rathod (2019), the Supreme Court held that the materiality test is whether the fact, if disclosed, would have made the insurer refuse the proposal or charge a higher premium. A condition the insurer would have ignored or covered at standard rates is, by definition, not material. Ask the insurer for its underwriting manual entry on that condition: if there is no automatic load or refusal, materiality fails.
Fraud vs inadvertent omission. In Sulbha Prakash Motegaonkar v LIC (2015), a question about “hospital admission in the last 5 years” was answered “no”. The insured had been admitted for a minor procedure unrelated to the fatal cause. The Supreme Court held that the answer was inadvertent, not fraudulent, and the claim was payable. The same logic applies when a routine diabetes diagnosis from a wellness camp is not entered into a proposal form by a citizen who never thought of it as a “disease”.
Documentary proof, not inference. Insurers love to attach undated discharge summaries that say “k/c/o diabetes” or “smoker since 10 years”. Without a dated diagnostic report, prescription record, or treating-physician statement from before the policy began, this is hearsay. Demand contemporaneous proof in writing.
This is the rule most citizens, and even many TPA agents, do not know exists. After 8 continuous policy years (whether with the same insurer or after portability), no health policy can be contested on grounds of non-disclosure or misrepresentation, except for established fraud.
Why it is broader than §45. §45 leaves “fraud” as a wide door for insurers. The IRDAI moratorium narrows the door further: only proven fraud, with documentary evidence, can defeat a claim after 8 years. Innocent omission, ambiguous proposal answers, and reliance on hospital paperwork will not pass.
Portability counts. If you switched insurers under IRDAI portability rules, the continuity period is preserved. Eight years of renewals across two insurers still gets you moratorium protection.
Lapse and reinstatement reset. A lapsed policy that is reinstated starts a fresh moratorium counter, but the §45 clock starts running afresh from the reinstatement date too. Keep your auto-debit active to preserve continuity.
How to invoke. Cite the Master Circular on Health Insurance Business dated 29 July 2024, paragraph on moratorium, in your written grievance. Attach proof of 8 continuous renewals (premium receipts or insurer's renewal certificate).
What “established fraud” means after moratorium. The Master Circular does not just say “fraud”, it says “established fraud”. That language imports the Supreme Court's strict standard of proof. The insurer must produce contemporaneous documentary evidence of all three §45 fraud elements (deliberate misstatement, knowledge of falsity, intent to deceive), tested in adjudication, not asserted in a repudiation letter. A claims-investigator's report alone will not pass this bar.
Reading the moratorium with §45 together. The two rules layer: §45 protects you from year 2 onwards on the “fraud” exception with shifted burden; the IRDAI moratorium protects you from year 8 onwards on the much narrower “established fraud” exception. Between year 2 and year 8 the insurer has a slightly easier path; after year 8 it is very nearly closed. Citizens routinely miss this layering when they argue their case, and end up settling for less.
Carve-outs to know. Moratorium does not apply to permanent exclusions that are clearly listed and signed off in the policy schedule. Cosmetic surgery, war-risk, suicide within 12 months in linked life products, and pre-existing conditions that you yourself declared and accepted with a specific waiting clause are different from “non-disclosure” rejections.
The 2024 definition is narrower than the older industry practice. To count as a PED:
The phrase “k/c/o diabetes for 5 years” in a hospital admission form is not contemporaneous proof of diagnosis date. NCDRC has repeatedly held that admission-form jottings reflect family recall in stress, not medical records.
What proposal-form ambiguity does for you. Most retail proposal forms ask broad questions like “Have you ever suffered from any disease?” or “Are you on any medication?” Courts apply the contra proferentem rule, ambiguity is read against the drafter, the insurer. If the question did not specifically ask about borderline-glucose or single-reading hypertension, an unanswered or “no” answer is not non-disclosure. In Bajaj Allianz v Saurabh Prakash (2006), the Supreme Court refused to enlarge a generic proposal question into a sweeping duty to disclose every medical detail.
Why TPA cashless denials are not final. Third Party Administrators are administrative agents, not adjudicators. A TPA cashless denial issued from the hospital desk is a holding decision, the insurer must still issue a separate written repudiation under the IRDAI Operations Regulations 2024 with reasons and the cited clause. If you only have a TPA SMS or call, you have no repudiation to challenge yet. Demand the formal letter.
To,
The Grievance Redressal Officer
[Insurer Name]
[Branch Address]
From,
[Your Name]
[Postal Address]
[Email] | [Phone]
Date: 16 May 2026
Subject: Repudiation of cashless and reimbursement claim under policy
no. [Policy Number] dated [DD-MM-YYYY], request for reconsideration.
Sir / Madam,
1. I hold policy no. [Policy Number] continuously renewed since
[DD-MM-YYYY], current renewal valid up to [DD-MM-YYYY].
Sum insured: ₹[Amount]. Premium paid: ₹[Amount] on [Date].
2. The insured, [Name of insured], was admitted at [Hospital Name]
on [DD-MM-YYYY] for [diagnosis], discharge on [DD-MM-YYYY].
Claim amount: ₹[Amount]. Claim no.: [Number].
3. By letter dated [DD-MM-YYYY], you repudiated the claim citing
"non-disclosure of pre-existing disease, namely [condition]".
4. I respectfully draw your attention to the following.
(a) Section 45 of the Insurance Act 1938, post-2015 amendment.
The policy is in its [N]th renewal year, well past the two-year
incontestability period. Repudiation can only stand on proven
fraud, with documentary evidence that the misstatement was
deliberate, known to be false, and intended to deceive.
(b) IRDAI Master Circular on Health Insurance Business dated
29 July 2024. Para on moratorium: after 8 continuous policy
years, the insurer cannot contest on grounds of non-disclosure
or misrepresentation, except for established fraud.
[Insert this paragraph if 8+ renewals.]
(c) PED definition under the same Master Circular requires the
condition to be physician-diagnosed within 36 months before
policy commencement. The condition you cite was not so
diagnosed. The only basis cited is a phrase in the hospital
admission record, which is not a contemporaneous medical
record.
(d) Supreme Court precedent: LIC v Asha Goel (2001),
Reliance Life v Rekhaben Rathod (2019),
Sulbha Motegaonkar v LIC (2015), and
Bajaj Allianz v Saurabh Prakash (2006).
Burden of proof for fraud lies on the insurer.
5. I request reconsideration of the claim, settlement with interest
at 8.5 percent per annum under IRDAI norms, and a written reasoned
decision within 14 days, failing which I will escalate to Bima
Bharosa, the Insurance Ombudsman, and the Consumer Commission.
Enclosures: copy of policy, proposal form, premium receipts,
discharge summary, hospital bills, diagnostic reports,
treating doctor's certificate, your repudiation letter.
Yours faithfully,
[Your Name]
[Signature]
Bima Bharosa portal: https://bimabharosa.irdai.gov.in Toll-free: 155255 / 1800-4254-732 Email: [email protected] Complaint type: Claim, partial settlement / non-settlement Complaint summary (paste into the portal text box): I, [Your Name], hold health policy no. [Policy Number] with [Insurer Name], in its [N]th continuous renewal. Claim no. [Number] for ₹[Amount] was repudiated on [Date] citing "non-disclosure of pre-existing disease". The cited condition was not diagnosed by a physician within 36 months before policy commencement, the only basis is a phrase in the hospital admission record. Section 45 of the Insurance Act 1938 (post-2015) and the IRDAI Master Circular on Health Insurance Business dated 29 July 2024, including the 8-year moratorium provision, both protect this claim. The grievance officer was approached on [Date] and has not resolved the matter within 15 working days. I request IRDAI's intervention to direct the insurer to settle the claim with interest at 8.5 percent per annum and to issue a reasoned written decision. Documents attached: policy, proposal form, premium receipts, repudiation letter, grievance officer correspondence, discharge summary, hospital bills, treating doctor's certificate.
Under the Insurance Ombudsman Rules 2017 (Redressal of Public
Grievances Rules), filed through https://www.cioins.co.in or
the regional Ombudsman office.
Complainant: [Your Name], [Address], [Phone], [Email].
Respondent: [Insurer Name], [Registered Office Address].
Policy no.: [Policy Number]. Claim no.: [Number].
Claim amount disputed: ₹[Amount].
Statement of complaint:
1. I have been continuously insured under [Insurer Name] since
[Date], the present policy is in its [N]th renewal.
2. The insured was admitted at [Hospital Name] on [Date] for
[diagnosis], claim of ₹[Amount] filed on [Date].
3. By letter dated [Date], the insurer repudiated the claim citing
"non-disclosure of pre-existing disease".
4. The repudiation is contrary to:
(a) Section 45, Insurance Act 1938 (post-2015 amendment),
(b) IRDAI Master Circular on Health Insurance Business dated
29 July 2024 (PED 36-month look-back and 8-year moratorium),
(c) Supreme Court precedent in LIC v Asha Goel (2001),
Sulbha Motegaonkar v LIC (2015), and
Bajaj Allianz v Saurabh Prakash (2006).
5. I approached the insurer's Grievance Officer on [Date] and IRDAI
Bima Bharosa on [Date]. Neither has resolved the matter.
6. Relief sought: settlement of ₹[Amount] with interest at 8.5%
per annum, compensation for harassment, and costs.
Declaration: this complaint is within ₹50,00,000 jurisdiction of the
Insurance Ombudsman, no civil suit or consumer complaint is pending
on the same cause of action, and I am the policyholder.
Date: 16 May 2026
Place: [City]
Signature: [Your Name]
Group health policy (employer-given). The grievance ladder runs through HR plus the group insurer. PED definitions in some group policies are softer than retail, since underwriting is portfolio-level. Ask HR for the master policy wording.
PSU vs private insurer. Same regulatory floor under IRDAI. PSU insurers sometimes have slower internal grievance turnaround, escalate to Bima Bharosa at day 16.
Senior-citizen policies. IRDAI 2024 rules prohibit age-based denial after 65 if previously insured, and cap PED waiting at 36 months across age bands.
Portability cases. File the portability request within 30 days before renewal. Credit for PED waiting period transfers. The 8-year moratorium clock continues, it does not reset.
First-year claims. Investigation is more rigorous because §45 and moratorium do not yet apply, but the insurer still needs to prove material non-disclosure with a contemporaneous record, not a hospital admission jotting.
Pre-policy medical examination. If the insurer made you undergo a pre-policy check-up and accepted the proposal, it cannot later cite a PED that the examination should have revealed. This is the doctrine of insurer estoppel.
Reinstatement after lapse. Fresh moratorium counter starts, but §45 still runs from the reinstatement date. Two years after reinstatement, the incontestability shield is back.
Ayushman Bharat PM-JAY. No PED exclusion at all in PM-JAY. If an empanelled hospital denies cashless, escalate via the PMJAY grievance portal and the state's e-Nivaran system, not IRDAI.
Mental-health conditions. IRDAI has clarified that mental illness is to be treated at par with physical illness for the purposes of cover and waiting period. A pre-policy diagnosis of anxiety or depression is still a PED only if it meets the physician-diagnosed 36-month test, and counsellor sessions without a prescription do not count.
COVID-19 history. A previous COVID infection is not a PED. IRDAI's 2021 and 2024 communications explicitly clarified that recovery from COVID, without any continuing condition arising out of it, cannot be cited as a pre-existing disease at proposal.
OPD-only conditions. Many citizens visit a doctor once for a viral fever or back pain, get a prescription, and never return. A single OPD visit without an ongoing treatment plan, in the courts' reading, is not “treatment was received from a physician” for the purposes of the PED definition. The 2024 Master Circular's reference to “advice or treatment recommended” reads in context of an ongoing or chronic condition.
MWPA-flavoured nuances. Where the policy is assigned under the Married Women's Property Act 1874, only the named beneficiary can sue, and the insurer cannot offset other dues against the claim. The §45 shield applies the same way.
Only if the insurer can prove fraud with documentary evidence. Under §45 Insurance Act, after 2 years the burden of proof is on the insurer to show the misstatement was deliberate, known to be false, and intended to deceive. Suspicion and hospital-form jottings are not enough.
After 8 continuous policy years (including portability), the IRDAI Master Circular on Health Insurance Business dated 29 July 2024 bars the insurer from contesting the claim on grounds of non-disclosure or misrepresentation, except for proven fraud. Quote the Master Circular paragraph in your written grievance and attach premium receipts as proof of 8 renewals.
Generally no. PED under the 2024 Master Circular requires physician-diagnosed condition or physician-recommended treatment within 36 months before the policy started. A single high reading without prescription and follow-up does not meet that bar.
No. Family history is not a PED unless you were personally diagnosed. NCDRC has repeatedly rejected this insurer argument.
The admission record is not a contemporaneous medical record. Ask the treating doctor for a clarifying certificate explaining that the phrase was based on family recall during admission and not on a dated diagnostic report. NCDRC and the Supreme Court have set aside repudiations resting only on this phrase.
Yes. Under the Redressal of Public Grievances Rules 2017, the Ombudsman's award up to ₹50,00,000 is binding on the insurer. If you accept the award, the insurer must pay within 30 days.
Yes. The Consumer Protection Act 2019 lets you file in the District, State, or National Commission directly through edaakhil online filing. Ombudsman is faster and free, consumer court can award higher compensation. Many citizens use Ombudsman first, then commission if unhappy.
A contemporaneous diagnostic record showing the condition was known to the policyholder before the policy started, plus a signed proposal-form question that specifically asked about that condition, plus evidence the answer was deliberately false. Hospital admission notes, family hearsay, and online searches do not suffice.
Yes. Under IRDAI portability rules, you keep the waiting-period credit you earned with the previous insurer. The 8-year moratorium clock also continues across insurers.
Waiting period is a contractual delay (typically 30 days for general illnesses, 24 months for specific listed illnesses, up to 36 months for declared PEDs) before the cover for those conditions starts. PED is the condition itself, defined by the 36-month look-back. A condition first arising after the policy started is not a PED, even if it falls within a specific-illness waiting period.
Last reviewed by RTI Wiki editorial team on 2026-05-16. This article is general information based on Indian law, not legal advice for any specific dispute. Always confirm current IRDAI circulars and case law before filing.