Exclusion Clauses Must Not Refute Insurance Policy's Purpose, NCDRC Holds Universal Sompo General Insurance Co. Liable

The National Consumer Disputes Redressal Commission (NCDRC) held that exclusion clauses in insurance policies must not negate the policy’s primary purpose. The case involved Universal Sompo General Insurance Co., which denied a claim based on an exclusion clause. The NCDRC ruled that such clauses should not defeat the fundamental intent of providing insurance coverage. The commission emphasized that insurers must honor claims that align with the policy’s main objective, ensuring fair treatment of policyholders. This ruling reinforces the principle that insurance contracts should be interpreted to fulfill their intended protective function.