Insurance Contracts Are Special Contracts Based On Principle Of Full Disclosure: NCDRC

The National Consumer Disputes Redressal Commission, presided by Dr. Inder Jit Singh, dismissed a revision petition against Life Corporation India and held that the proposer of an insurance policy must disclose all material facts about the risk involved and be transparent with the facts. The insurer maintained that the policy was invalid due to the false information provided and pointed out that both the District Forum and the State Commission dismissed the complainant's case, supporting the decision to repudiate the policy. The Supreme Court in the Reliance Life Insurance vs. Rekha Ben Nareshbhai Rathod case observed that the failure of the insured to disclose a previously obtained policy entitled the insurer to repudiate the claim. Furthermore, in Manmohan Nanda vs. United India Assurance Company Limited and Another, the Supreme Court held that insurance contracts are special contracts based on the principle of full disclosure.