In a landmark ruling, the Bombay High Court has held that insurance companies cannot reject hospitalisation claims simply because they are filed after the policy deadline — a decision that could reshape how health insurance claims are handled across India.
On 20 April 2026, a division bench of justice Bharati Dangre and justice Manjusha Deshpande ruled that time-bar clauses in insurance policies — which restrict a policyholder's right to file claims beyond a specified period — are void and unenforceable under Section 28(b) of the Indian Contract Act, 1872. "...We find that the said clause imposing a limitation on invocation of right under the policy only on the ground that it was beyond the specified period, therefore, clearly attract clause (b) of Section 28 of the Indian Contract Act."
"Section 28 of the Indian Contract Act prescribe that any agreement, which extinguishes the rights of any party thereto, or discharges any party thereto, from any liability, under or in respect of any contract on the ground of expiry of a specified period, so as to restrict any party from enforcing his right, is void to that extent, and in our view, such an inhibition in insurance policy restricting the period of availing the benefit under the policy, which the insured is otherwise entitled to avail, cannot be sustained and has to be declared as void and non-est in the wake of the decision of the Apex Court,"
the order says
The Court directed United India Insurance Company to reimburse the disputed claim within eight weeks, along with 6% annual interest from the date the payment first became due.
The petition was filed by CP Ravindranath Menon, who was covered under a group health insurance policy through his employer, the Export-Import Bank of India (valid April 2021 – March 2022).
Mr Menon submitted reimbursement claims in May 2022 for medical expenses incurred during the policy period. The insurer rejected a claim worth ₹1.13 lakh, citing a 90-day filing limit mentioned in the policy.
The insurer argued that since Mr Menon had agreed to all policy terms — including the 90-day clause — he was bound by them and the rejection was valid. The Court flatly rejected this position.
"Such an inhibition in an insurance policy restricting the period of availing the benefit under the policy, which the insured is otherwise entitled to avail, cannot be sustained and has to be declared void and non-est, " the bench says.
The Court leaned on a 2022 Supreme Court precedent (The Oriental Insurance Company case), which had previously held that timeline conditions in insurance policies that extinguish legitimate rights are contrary to Section 28(b) of the Indian Contract Act — and, therefore void. The insurer's attempt to distinguish that ruling from Mr Menon's case was dismissed.
For Policyholders
- A missed filing deadline alone can no longer be grounds for rejection of an otherwise valid claim.
- Policyholders who were previously denied claims on purely procedural timing grounds now have a strong legal basis to challenge those decisions.
- It is still advisable to file claims on time, but this ruling serves as a critical safety net.
For the Insurance Industry
- Insurers will need to revisit standard rejection practices that rely on time-bar clauses.
- The focus must shift to the merit and validity of the claim itself, not procedural technicalities.
- This ruling applies to both group and individual health policies.
Legal experts widely view this as a watershed moment for the insurance sector. The ruling is seen as effectively disabling insurers from rejecting legitimate claims on the mere ground of procedural delay, compelling them to revisit their standard rejection practices. Experts note that companies can no longer hide behind technical time limits to deny valid claims — the emphasis must now rest squarely on whether the claim itself is genuine and justified, rather than on when it was filed. The Court's prioritisation of the insured's substantive right to protection over administrative deadlines is being hailed as a significant and long-overdue shift in the legal landscape.
This ruling marks a significant shift in the power balance between insurers and policyholders. For years, a missed deadline meant a lost claim — regardless of whether the underlying expenses were genuine. The Bombay High Court has now made it clear: a valid claim is a valid claim and a procedural delay cannot strip a policyholder of their rightful benefit.
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