The Supreme Court has ruled that an insurer cannot reject a claim merely on the ground of the claimant's failure to mention that they hold multiple policies from different insurers.

The court held that an insurer can have any number of insurance policies and this cannot be ground for rejection as long as no fraud had been committed.

"We are of the considered view that such a failure would not influence the decision of a prudent insurer to issue the policy proposed. The policy in question is not a mediclaim. It is a life insurance cover and the death of the deceased has taken place on account of an accident.

"Accordingly, failure to mention about other policies does not amount to a material fact in relation to the policy availed and consequently, the claim could not have been repudiated by the respondent company," the court said.

A bench of Justice B.V. Nagarathna and Justice Satish Chandra Sharma passed the judgment while allowing the appeal of Mahaveer Sharma challenging the concurrent rulings of the Rajasthan State Consumer Commission and the National Consumer Redressal Commission upholding the decision of Exide Life Insurance Co Ltd to deny the claim on the ground that the deceased had concealed he had taken three other insurance policies from LIC, apart from a ₹40 lakh policy with Aviva Life Insurance.