The Kurnool district consumer commission directed HDFC Life to honor a 50 lakh rupee insurance claim, applying the doctrine of contra proferentem to interpret ambiguous policy language against the insurer.
The bench said vague exclusion clauses and undefined survival periods must be read in favor of the insured when drafting ambiguity prevents a reasonable policyholder from understanding coverage limits.
The claimant’s family argued the company delayed settlement by invoking technical definitions never clearly disclosed at the point of sale.
Insurance law practitioners said the order reinforces a long-standing principle that life insurers— as drafters of standard form contracts—bear the burden when terms admit multiple readings.
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Sources:
https://www.livelaw.in/