What is the story about?
Bombay High Court recently in a decision said that an insurance company cannot reject hospitalisation expense claims merely because the time limit specified
in the policy for filing the claim expires. In the case of C.P. Ravindranath Menon v. United India Insurance Co. Ltd. (2026), Menon sought reimbursement from United India Insurance Company under a group health policy obtained through his employer, Export-Import Bank of India. The policy was valid from April 1, 2021, until midnight of March 31, 2022. The insurance company had rejected the claim on the ground that it was submitted after expiry of the stipulated 90-day window post hospitalisation. Comprising Justices Bharati Dangre and Manjusha Deshpande, a division bench in its order of April 20, directed the insurance company to reimburse the amount under the policy within eight weeks from the date of passing the order, along with annual interest at 6% from the time it became due and payable.
What exactly Bombay HC ruling change for policyholders and insurers?
Explaining the rationale behind the impact of Bombay High Court's decision on the policyholders and insurers, Anoj Menon, Senior Partner at Desai & Diwanji told Times Now Digital, "this ruling is an addition to the existing list of judicial pronouncements affirming that delay, in itself, is not a sufficient ground to deny an insurance claim, and that contractual timelines cannot override a policyholder’s substantive entitlement within the statutory limitation period."
"While insurers may prescribe procedural timelines, repudiation must ultimately rest on the merits of the claim—namely, coverage under the policy and the quantum claimed rather than on technical non-compliance alone. That said, despite this settled legal position, insurers continue in practice to rely on delay as a ground for rejection, with such decisions often being corrected only upon judicial intervention," he said.
Winnie Akhoury Shekhar, Partner at CMS INDUSLAW while speaking with Times Now Digital said, "Such time limits are now looked at as procedural, not absolute essence of the insurance contract. Insurers must look at the merits, not just the clock."
Can insurers still reject claims on procedural grounds if there is a delay in intimation or documentation?
On the matter, Anoj Menon said it is settled law that insurers cannot reject claims solely on the ground of delayed intimation or delayed submission of documents, where there is coverage under the policy and the claim is genuine.
"What this judgment further clarifies is that procedural lapses do not automatically extinguish a policyholder’s right to coverage. Insurers may still question a claim where delay materially affects verification, raises doubts about genuineness, or causes demonstrable prejudice, but they cannot and ought not to simply treat missed timelines as a standalone ground for repudiation," he said.
Winnie Akhoury Shekhar echoed and said insurers can reject claims but only if they show real prejudice or policy breach. "A mere delay in intimation or paperwork is no longer enough to deny a claim."
What legal remedies do policyholders have if their health insurance claim is delayed or denied unfairly?
Anoj Menon of Desai & Diwanji shared that the IRDAI, regulatory authority of Insurance sector, prescribes timelines for claim processing, and any delay or arbitrary denial may be challenged.
"A policyholder may first raise a grievance with the insurer to show that due process was followed. If unresolved, they can approach consumer commissions for deficiency in service, seek redress before the Insurance Ombudsman for quicker, low-cost resolution. Alternatively, disputes may be referred to arbitration (if provided in the policy) or pursued before civil courts," Anoj told.
"Policyholders can go to the Insurance Ombudsman for quick relief, or the Consumer Commission for compensation and interest. Both routes can prove to be quite effective against any kind of wrongful denial," Winnie Akhoury Shekhar of CMS INDUSLAW said.
What is the fastest legal route—consumer court, insurance ombudsman, or civil court?
In a scenario where the policyholders' rights are breached, Anoj Menon shared that the fastest route is the Insurance Ombudsman. It is designed to be informal, low-cost, and relatively quick, and is particularly effective for straightforward disputes involving delay or wrongful denial of claims.
"Consumer commissions under the Consumer Protection Act, 2019 are the next best option widely used for insurance disputes where stronger remedies are necessary, though timelines are typically longer than the Ombudsman process; however, they still face case pendency and multi-tier appellate processes."
"The last option is the civil suits, which may be the least preferred option given the volume of cases pending before the courts as well as the time involved for a completed adjudication followed by appeals," he said.
Winnie Akhoury Shekhar said the civil courts are typically slower but may understand complex cases way better and hence provide a better remedy or solution there.
