Dr KK Aggarwal & Ira Gupta
In February this year, the Delhi High Court in the case of M/S United India Insurance Company Limited v. Jai Parkash Tayal (RFA 610/2016 & CM Nos.45832/2017) dated 26th February, 2018 had directed Insurance Regulatory Development Authority of India (IRDA) “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.”
The Delhi High Court had held that “a person, suffering from a genetic disorder, needs medical insurance as much as others” and concluded its judgement with the following statements:
However, vide an order dated 27.08.2018, the Hon’ble 3 Judges Bench of Supreme Court of India has partially stayed the above judgment in “The United India Insurance Co. Ltd. Versus Jay Prakash Tayal, SLP(c) No. 29590/2018” passed by the Hon’ble High Court of Delhi.
The stay order extends to following issues:
i. Right to avail health insurance is an integral part of the Right to Healthcare and the Right to Health, as recognised in Art. 21 of the Constitution
ii. Discrimination in health insurance against individuals based on their genetic disposition or genetic heritage, in the absence of appropriate genetic testing and laying down of intelligible differentia, is Unconstitutional;
iii. The broad exclusion of genetic disorders' is thus not merely a contractual issue between the insurance company and the insured but spills into the broader canvas of Right to Health. There appears to be an urgent need to frame a proper framework to prevent against genetic discrimination as also to protect collection, preservation and confidentiality of genetic data. Insurance companies are free to structure their contracts based on reasonable and intelligible factors which should not be arbitrary and in any case cannot be 'exclusionary. Such contracts have to be based on empirical testing and data and cannot be simply on the basis of subjective or vague factors. It is for lawmakers to take the necessary steps in this regard.
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.