June 19, 2021

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Delhi High Court says Denying health insurance for genetic conditions ‘unconstitutional’, violates rights


The Delhi High Court has passed a judgment that would, in future, make health insurance contracts more transparent.

Delhi High Court asked Insurance Regulatory and Development Authority of India (IRDAI) to check their exclusionary clauses to make sure that insurers don’t reject insurance claims on the basis of genetic disorder.

Delhi High Court said that excluding people with genetic disorders from receiving health insurance is “unconstitutional” and “discriminatory and violative” of a citizen’s right to health.

Insurers usually put a ‘hereditary diseases’ clause while drawing up a contract, which also rejects claims for ailments that are contracted due to genetics.

The court upheld a last year’s trial court order that directed United India Insurance to pay a sum of Rs 5 lakh to the insured. “Suffering from a genetic disorder needs medical insurance as much as others,” the court had said.

The judgment was passed after one Citizen Jai Prakash Tayal approached the trial court as United India Insurance rejected his claims citing “general exclusion clauses”.

Tayal suffers from Hypertrophic Obstructive Cardiomyopathy, a condition that thickens portions of the heart reducing its capacity to pump blood.

Tayal had taken a medical policy of Rs 5 lakh, which was renewed every year till 2012 from 2004. The complainant was hospitalized twice – in 2004 and 2006 – during which United India Insurance paid his claims but refused him the third time in 2011.

Tayal also mentioned that this exclusion was not initially a part of the contract, but was added later in a policy document without notifying him.

“In effect, it would mean that large swathes of population would be excluded from availing health insurance which could have a negative impact on the health of a country. Thus, it is necessary to determine the legality of such exclusion in insurance policies… Without doing genetic testing and prescribing what is the kind of genetic disorder which is excluded, applying a general exclusion would lead to arbitrariness,” the court said according to popular news paper the Indian express.

“Thus, IRDA ought to have supervised the manner in which the term genetic disorders are being misused by insurance companies to reject genuine claims.

Obviously the IRDA turned a blind eye to the functioning of insurance companies,” Delhi High Court said.”Such contracts have to be based on empirical testing and data and cannot be simply on the basis of subjective and vague factors. It is for the lawmaker to take necessary steps in this regard.

However, the broad exclusion of genetic disorders from insurance contracts/claims is illegal and unconstitutional,” it said.

The judgment looks like a welcome move as it ensures that health insurance contracts are drawn in a transparent manner.