A bench of Acting Chief Justice Gita Mittal and Justice C Hari Shankar issued notice to the Ministry of Finance and the Insurance Regulatory Development Authority (IRDA) and directed them to file their replies to the plea before the next date of hearing on August 8.
The petition, moved by advocate Arpit Bhargava, has alleged that in the absence of guidelines for mandatory medical examination, the insurance companies were rejecting claims on the ground that material facts regarding health of the insured were not disclosed.
He has also contended that at the time of receiving applications, the insurance company agents often only take the customers' signature and fill up details on their own and the policies are issued without carrying out any health check-up of the applicant.
He has alleged in his plea that the insurance companies have taken the public at large "for a ride" as it is only interested in "collecting premiums on insurance policies".
He has also claimed that the government and IRDA are acting as mute spectators to the issue which has been raised in several complaints before the consumer forums.
"At present, admittedly, there is no regulation in India due to which insurance companies are minting money at the cost of health of innocent members of public and respondent 1 (ministry) and respondent 2 (IRDA) are acting as mute spectators," the petition said.
Bhargava has sought directions to the ministry and IRDA to frame regulations or guidelines to make medical examinations mandatory before issuing insurance policies.