Telangana consumer commission says Care Health wrongly cancelled policy without notice

The Telangana State Consumer Disputes Redressal Commission on 23 October 2026 dismissed an appeal by Care Health Insurance and upheld an order directing it to renew a 70-year-old policyholder's health policy, which it had cancelled citing non-disclosure of a pre-existing illness. The commission held that the policyholder had not hidden his health condition and that the insurer cancelled the policy without the written notice its own terms required.

What Happened

According to the order, the policyholder had a group health policy with The Oriental Insurance Company from 31 December 2015 with a sum insured of Rs 5 lakh, and later ported it to Care Health with a sum insured of Rs 10 lakh, paying a premium of Rs 85,522. He was treated in hospital from 19 to 22 July 2023. The insurer refused cashless treatment and later rejected his reimbursement claim, saying he had not disclosed that he was on medication for a urinary condition since December 2020. It cancelled the policy on 1 February 2024.

The District Consumer Disputes Redressal Commission-I, Hyderabad, on 3 April 2025 ordered the insurer to renew the policy on receiving the premium and to pay Rs 20,000 as compensation and Rs 10,000 as costs within 45 days.

The state commission noted that the cancer diagnosis came in a biopsy report dated 10 December 2021, after the policy began on 17 January 2021. The proposal form had only five questions, none about symptoms or medication, and the policyholder had answered "yes" to the question on pre-existing disease. The insurer issued the policy without asking for details, so it could not later allege suppression, the commission held. It added that the policy allowed cancellation for non-disclosure only after 15 days' written notice, and none was given.

What It Means

For policyholders, the order holds that an insurer cannot cancel a policy for non-disclosure when it never asked the relevant question, or when it issued the policy after the proposer declared a pre-existing disease. Where the policy requires notice before cancellation, cancelling without it is a deficiency in service. A policyholder facing a wrongful rejection or cancellation can approach the National Consumer Helpline (1915) or file a complaint through e-Daakhil. The commission's order may be appealed.

Source: Consumer commission order