Most people buy life insurance and never think about the paperwork again. The proposal form matters more than they realise, and it matters most in a window that closes.
Indian law puts a date on it. After that date the argument is over.
The rule
Section 45 of the Insurance Act, 1938 is short in effect if not in wording: no policy of life insurance shall be called in question on any ground whatsoever after the expiry of three years.
"On any ground whatsoever" is doing an enormous amount of work in that sentence. It is not "on any reasonable ground", or "except where the insurer later discovers something". It closes the question.
IRDAI's own guidance on the section describes the same position: a three-year window during which the policy may be contested, and outside it, not.
The three years do not start when you think
This is the part that decides real cases, and it is where people miscount.
The period does not run from whichever date is earliest. It runs from the later of several dates:
- the date of the policy, or the date of its issuance
- the date on which the risk commenced
- the date of revival of the policy
- the date of a rider
Two consequences follow, and the second one surprises people.
A gap between application and risk commencing pushes the date out. If the risk started later than the policy was dated, the clock starts from the later one.
Reviving a lapsed policy restarts it. A policy taken in 2015, lapsed in 2024 and revived in 2025 is not a ten-year-old policy for these purposes. As far as the revival goes, the contestable window opens again from the revival date.
That last point is the practical one. People who let a policy lapse and reinstate it often believe their long history protects them. In respect of the revival, it does not.
The same logic applies to a rider added years into a policy: the rider brings its own date.
What the insurer may do inside the window
Within three years, the policy may be called in question on two kinds of ground.
Fraud. The stricter category, and treated differently on premiums.
Misstatement or suppression of a material fact. The wording concerns a statement or suppression of a fact material to the expectancy of the life of the insured, made incorrectly in the proposal or the other documents on which the policy was issued or revived.
"Material to the expectancy of life" is the test. Not every error qualifies — the question is whether it bore on the risk the insurer was taking. An unreported history of a serious condition is a different thing from a misspelled employer's name.
And the insurer cannot simply act. The decision and the grounds on which it is taken have to be communicated in writing to the insured or the legal representatives. A repudiation with no stated reason is not what the section contemplates.
The premium refund that is easy to miss
A provision worth knowing about, because it applies at the worst moment.
Where a policy is repudiated on the ground of misstatement or suppression of a material fact, and not on the ground of fraud, the premiums collected on the policy up to the date of repudiation are payable to the insured or the legal representatives.
So a family whose claim is repudiated for non-disclosure — where fraud is not the basis — should not also lose the premiums paid. That is a separate entitlement from the claim itself, and it is one that goes unclaimed when nobody knows it exists.
Fraud is treated differently, which is part of why the distinction between the two grounds matters so much in any dispute.
How this compares with health insurance
Worth setting side by side, because the two are often confused and the numbers differ.
| Life insurance | Health insurance | |
|---|---|---|
| Source | Section 45, Insurance Act, 1938 | IRDAI Master Circular on Health Insurance Business |
| Period | Three years | Sixty months of continuous coverage |
| After it | Not contestable on any ground whatsoever | Not contestable for non-disclosure or misrepresentation, except established fraud |
The health rule is set out in the guide to IRDAI's cashless and claim protections, and it carries an express exception for established fraud after the moratorium. Section 45's wording for life policies does not carry that carve-out after three years.
Two different products, two different regimes, two different clocks. Neither one tells you anything about the other.
What this means in practice
Fill the proposal form properly, once. The whole structure rewards accuracy at the start and punishes the opposite for three years. A disclosure that raises the premium is far cheaper than a repudiated claim.
Do not let a policy lapse if you can help it. Beyond the cover gap, revival reopens a window you had already closed.
If a claim is repudiated, ask for the grounds in writing, and check the dates. Whether the policy was inside or outside the three years changes what the insurer is permitted to argue.
Know where to escalate. IRDAI's Bima Bharosa (opens in a new tab) grievance portal and, after that, the Insurance Ombudsman, are the routes when an insurer and a family disagree.
If the question is about tax on the payout rather than whether it is paid at all, that is Section 10(10D) and its conditions.
What to actually check
- The dates on your own policy — issue, commencement of risk, and any revival or rider.
- Three years from the latest of those. That is the date that matters.
- Whether anything in your proposal form was wrong or omitted. Inside the window, it is worth correcting.
- Any policy you have revived. Its clock restarted.
- On a repudiation: the stated ground. Fraud and misstatement lead to different outcomes on premiums.
This is a summary of how Section 45 works, written as background for readers in India rather than as legal, insurance or financial advice. The application of the section to any particular claim depends on the policy, the facts and the documents, and disputes are decided by the forums that hear them. Take a contested claim to a qualified adviser, the insurer's grievance officer or the Insurance Ombudsman.
Sources
- IRDAI — Section 45 of the Insurance Act, 1938 (opens in a new tab)
- IRDAI — Consolidated and gazette notified regulations (opens in a new tab)
- IRDAI — Bima Bharosa grievance portal (opens in a new tab)
- IRDAI — Regulations and circulars (opens in a new tab)
- Council for Insurance Ombudsmen (opens in a new tab)
This article is general information for an Indian audience and reflects Section 45 of the Insurance Act, 1938 as described in IRDAI guidance at the date of review. It is not legal, insurance or financial advice. Statutory provisions are amended, and how a section applies to a specific claim turns on the facts, the policy wording and the evidence. Confirm the current position with IRDAI or a qualified adviser before relying on any of this. Last reviewed 17 September 2026.
