In an appeal filed before the Delhi High Court challenging the Trial Court’s order, the Exclusion Clause that formed a part of the Insurance policy was held to be unconstitutional as it violated Article 14 of the Constitution of India. The brief facts of the case are that the Respondent/Plaintiff had availed the policy provided by the Defendant Insurance Company which was renewed by him time to time. The Plaintiff had also availed the claim on the policy on two occasions but on the third occasion, his claim was declined stating that ‘the genetic diseases were not payable as per the policy, genetic disorder clauses.’ The Plaintiff filed a plea before the Trial Court stating that the exclusion of genetic disorders clause was not a part of the initial policy document and was added subsequently without intimating the Plaintiff and thus the exclusions do not bind him. The Trial Court, however, held that the renewal of the insurance policy has to be in conformity with the existing terms and conditions and any additional changes were not informed to the Plaintiff by way of an advance notice. It was further stated that the clauses against those suffering from genetic disorders are discriminatory in nature and hence cannot be a part of the insurance policy.
Placing reference to the judgment passed by the Apex Court in C.E.S.C. Limited and Ors. v. Subhash Chandra Bose and Ors. (1992) 1 SCC 441, the High Court held that Article 14 of the Indian Constitution prohibits discrimination on any ground. The Court further observed that Right to Health and Right to Healthcare are fundamental rights under Article 21 and are primordial to the existence and well-being of every Indian citizen. The High Court further observed that exclusion go genetic disorders in all forms under health insurance would be against public policy as a large population suffers from prevalent medical conditions such as high blood pressure, cardiac issues, diabetes etc. and classifying such prevalent conditions under the genetic disorders clause defeats the purpose of taking medical insurance.
The High Court, in its judgment dated 26th February 2018, concluded that,
“(iv)The Exclusionary clause of `genetic disorders’, in the insurance policy, is too broad, ambiguous and discriminatory – hence violative of Art. 14 of the Constitution of India;
(v) Insurance Regulatory Development Authority of India (IRDA) is directed to re-look at the Exclusionary clauses in insurance contracts and ensure that insurance companies do not reject claims on the basis of exclusions relating to genetic disorders.”
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