Source: International Finance News
On 10 12, the Supreme People's Court, the People's Bank of China, the National Financial Regulatory Administration, and the China Securities Regulatory Commission jointly released six typical cases on protecting the legitimate rights and interests of financial consumers and investors.
This release features cases spanning financial lending, fund management, digital finance, life insurance, and securities investment. It addresses critical issues and judicial challenges—including standard terms, fair trading, suitability obligations, rights protection, and diversified dispute resolution—demonstrating how financial adjudication drives high-quality industry development and underscores the importance of building a fair, transparent, trustworthy, and secure financial market ecosystem.
In Case 5, on 2020/9/11, Mr. Xu purchased a whole-life critical illness insurance policy with an additional waiver-of-premium rider for his daughter, Ms. Wu, from a certain life insurance company. The basic sum insured was 40 ten thousand yuan, with an annual premium of 4840 yuan and a payment term of 19 years. Coverage lasts for life. The contract includes "Hepatolenticular degeneration (Wilson's disease)" within the scope of covered critical illnesses but imposes strict clinical diagnostic criteria.
In 2024, month 2, Mr. Wu sought medical care at Children's Hospital of Zhejiang University School of Medicine due to abnormal liver function. Following multiple specialized examinations, he was diagnosed with "hepatolenticular degeneration (Wilson's disease)" on 2024, month 2, day 4. The hospital issued a "Certificate of Diagnosis" in accordance with legal requirements. Mr. Wu then filed a claim for critical illness benefits and requested premium waiver for subsequent installments with an insurance company. After review, the insurance company determined that although Mr. Wu's condition falls within the scope of critical illnesses listed in the contract, it did not fully meet all clinical criteria specified for this disease in the agreement. Consequently, the company denied both the benefit claim and the premium waiver request. Mr. Wu subsequently filed a lawsuit.
The People's Court of Quzhou Intelligent Manufacturing New District, Zhejiang Province, reviewed the case and found that the insurance coverage clauses in the disputed contract were standard terms provided by the insurer. These clauses impose stringent claim requirements, and the insurer failed to fulfill its obligation of adequate notification and explanation. Therefore, the insurer's refusal to pay is not well-founded. Continuing with litigation would necessitate expert appraisal, challenges to the appraisal findings, and review procedures, significantly prolonging the process. Given that Mr./Ms. Wu urgently needs the claim proceeds for ongoing treatment, the court prioritized mediation to promptly protect the parties' rights and resolve the dispute substantively.
Under court-mediated settlement, both parties voluntarily reached a mediation agreement on 2024/5/17: 1. A certain life insurance company shall pay Wu a one-time critical illness insurance claim payment of 36 ten thousand yuan;
II. Waiver of the 16th renewal premium of 4 yuan for Wu, effective from the date of diagnosis on 2024/2/4.
III. The personal insurance contract dispute between the plaintiff and the defendant is now concluded, with no further disputes between the parties. On 5/25, a life insurance company fulfilled its payment obligations. The case was resolved in just 20 days.
The Supreme People's Court has noted that in judicial practice, some critical illness insurance contracts impose overly strict and detailed professional diagnostic requirements, objectively raising the bar for claims by consumers. This has led to frequent disputes over insurance claims. This case accurately applies the rules on standard terms under the Civil Code and the principles of utmost good faith and contra proferentem under the Insurance Law. It clarifies the legal boundary between contractually agreed diagnostic standards and conventional clinical diagnoses, establishing that insurers cannot deny claims based on contractual provisions that exceed clinical diagnostic norms. The ruling safeguards the legitimate rights and interests of financial consumers and guides insurance institutions to regulate their claims-handling practices. Additionally, recognizing the urgent need for medical treatment faced by the insured party, the court actively facilitated litigation mediation. This approach effectively avoided complex medical appraisal procedures, ensured timely fulfillment of insurance coverage, and substantially resolved the dispute. The case serves as a valuable precedent for handling similar personal insurance claim disputes.
