BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM :: KADAPA Y.S.R DISTRICT
PRESENT SMT. K. SIREESHA, B.L., PRESIDENT FAC
SRI M.V.R. SHARMA, MEMBER.
Monday, 23rd June 2014
CONSUMER COMPLAINT No. 09/ 2014
Murathoti Dora Babu, S/o M. Ananda Rao, Hindu,
aged 24 years, Residing at Amagampalli Post,
Kasinayana Mandal, Kadapa District. ….. Complainant.
Vs.
1. The Branch Manager, SBI Life Insurance Co. Ltd.,
1st floor, CPVR Towers, Opp. RTC Bus Stand Out gate,
Chinnachowk, Y.S. Nagar, Kadapa – 516 001,
2. The Asst. Manager – Claims, SBI Life Insurance Co. Ltd.,
Central Processing Centre,
Kapas Bhavan, Plot No. 3 A, Sector No. 10, CBD Belapur,
Navi Mumbai – 400 614, Maharastra State. ….. Opposite parties.
This complaint coming on this day for final hearing on 16-6-2014 in the presence of Sri K. Vijaya Krishna, Advocate for complainant and Sri T. Jayaram, Advocate for Opposite parties and upon perusing the material papers on record, the Forum made the following:-
O R D E R
(Per Smt. K. Sireesha, President FAC),
1. Complaint filed under section 12 of the C.P. Act 1986.
2. The brief facts of the complaint are as follows:- It is humbly submitted that one Murathoti Padmavathamma, W/o Devaraju, resident of Amagamapalli post and village, Kasinayana Mandal, Kadapa District is grandmother of the complainant herein. Durig her life time, the said M. Padmavathamma insured her life with the R1 on 15-7-2013 under SBI Life – Flexi Smart Insurance vide proposal No. 56QC652436 by paying an annual premium amount of Rs. 25,000/-. The R1 has issued proposal deposit receipt dt. 15-7-2013.
3. It is further submitted that the life assured M. Padmavathamma was born 10-1-1954. The life assured was aged 59 years as on the date of entering into the contract of life insurance policy with the R1. The life assured had not been suffering from any disease and she was quite hale and healthy at the time of entering the contract of life insurance. She had disclosed all relevant information regarding her health and other pertinent matter to the company. The life assured was medically examined by Dr. Sri S. Shyamsundar Reddy, M.D. Remedy Hospital, Kadapa on 20-7-2013. Having been satisfying with the health condition of the life assured and after concluding the contract of life insurance, the R1 issued policy No. 56048122809 in favour of the life assured on 25-7-2013 for a sum assured of Rs. 2,50,000/-. The complainant who is grandson to the life assured was nominated as beneficiary of the policy if any contingency happens.
4. It is further submitted that unfortunately the life assured namely M. Padmavathamma, died on 26-7-2013, due to heart attack in her village i.e. Amagampalli village, Kasinayana Mandal, Kadapa District surviving by the complainant herein during the term of the policy. Consequently, the complainant has become entitled to the benefits covered by the aforementioned policy. The complainant intimated to the R1 about the death of the life assured. The complainant also furnished the claim form to the R1 by enclosing the necessary documents seeking benefits of the policy. The R2 addressed a letter dt. 16-8-2013 acknowledging the receipt of the death claim intimation in respect of the subject matter policy.
5. It is further submitted that the complainant has approached the R1 on many occasions for payment of policy amount for which the R1 has been postponing the payment of policy amount on some pretext or other saying that the claim was under the process in the Head Office at Mumbai. By saying so, the R1 made the complainant to revolve around the office of R1 on a number of occasions. The complainant was patient enough to pursue the R1 on an innumerable occasions hoping that his claim would be honoured by the respondents, but in vain.
6. Aggrieved by the nonpayment of policy amount, the complainant has sent a legal notice dt. 7-11-2013 through his counsel to the R2 seeking the policy claim amount. After receipt of the said legal notice, the R2 sent a reply dt. 15-11-2013 with untenable allegations. It is informed to the complainant that the claim was repudiate don 30-9-2013 and the amount of Rs. 13,167/- was paid vide cheque No. 494103 dt. 30-9-2013 towards balance in policy amount, bonus and deposit balance as per policy terms and conditions and that the decision of the claim rejection was informed to the complainant vide letter dt. 3-10-2013. In fact no such letter was received by the complainant and he did not receive any such cheque as being claimed by the respondents.
7. It is further submitted that the claim of the complainant was repudiated saying that the deceased life assured died on 26-7-2013 and so the policy resulted in claim in just one day, that the deceased life assured was suffering from Hypertension and cerebral vascular accident prior to the date of commencement of the policy which she has not disclosed in the proposal form and that she was misstated her age as 59 years but her actual age was 72 years. These findings of the respondents are wholly unfounded, arbitrary and unwarranted but framed up with ulterior designs of evading the policy claim amount to the complainant only.
8. It is further submitted that the proposal for the claim was made on 15-7-2013 on which day the deceased life assured had not only paid the annual premium amount of Rs. 25,000/- but also disclosed all relevant information including her age and health. She was also duly examined physically and medically by the competent medical practitioner to satisfy about her health condition. After concluding the contract about the information furnished by the life assured including her age and health, the respondents company has issued the subject matter life insurance policy on 25-7-2013. Thus the allegation that the policy resulted in claim in just one day, is untenable.
9. It is further submitted that during her life time, the deceased life assured never suffered from any disease much less the ones alleged by the respondents in their repudiation letter. She was aged 59 years as per her date of birth. i.e. 10-1-1954 as on the date of entering into the contract of life insurance policy and the same bears out by the ration card, Aadhar card and Baptism certificate of the deceased life assured. Thus the fact remains is that the deceased life assured never misstated her age and she never concealed any fact about her health. Nevertheless, the respondents have repudiated the claim of the complainant on flimsy reasons and claiming that the claim was repudiated on 30-9-2013 and that the amount of Rs. 13,167/- was paid vide cheque No. 494103, dt. 30-9-2013, in fact has never received by the complainant. Thus the acts of the respondents would tantamount to deficiency of service due to which the complainant had to suffer mentally, physically and fiscally. Having no other way, the complainant is constrained to approach the Hon’ble forum. Hence, this complaint.
10. It is submitted that the cause of action for this complaint arose on 15-11-2013 when the intimation relating to the repudiation of the claim was sent to the complainant and in Kadapa city where the Branch office of the R1 is located and the deceased life assured was last resided and died in Amagamapalli village, Kasinayana Mandal, Kadapa District within the jurisdiction of the Hon’ble forum. An Indian Postal order worth of Rs. 200/- is paid along with this complaint.
11. Therefore, it is most humbly prayed that the Hon’ble forum may be pleased to (a) direct the respondents jointly and severally to pay an amount of Rs. 2,50,000/- being the claim amount covered under the subject matter policy with interest @ 18% p.a. until realization, (b) direct the respondents to pay an amount of Rs. 50,000/- towards deficiency of service (c) direct the respondents to pay an amount of Rs. 50,000/- (d) Direct the respondents to pay an amount of Rs. 10,000/- towards costs of this complaint incurred by the complainant and (e) Grant such other relief or reliefs as the Hon’ble forum deems fit and proper in the circumstances of the case and in the interest of justice.
12. Written statement filed on behalf of the respondents 1 & 2. SBI Life Insurance Co. Ltd., (hereinafter referred to as SBI Life) is a life insurance company, a company registered under the companies Act 1956 and carrying on the life insurance business as licensed by IRDA under the provisions of the insurance Act 1983.
Preliminary objections:-
The address of the O.P.2 is at Mumbai, but the complaint is filed before the Hon’ble forum at Kadapa. Hence, the complaint is not maintainable for want of territorial jurisdiction of the Hon’ble forum. Hence, on this ground alone, the complaint is liable to be dismissed against O.P.2.
13. The Life insurance Contract is a contract of “utmost good faith” where in the proponent is duty bound to disclose everything concerning health, habits and other related matters which are within her knowledge at the time of making the proposal, failing which the insurer has every right to repudiate the claim. In the instant case, the deceased life assured Smt. Murathoti padmavathamma committed a breach of the principle of utmost good faith by suppressing the material fact that she was suffering from Hypertension and cerebral vascular accident prior to the date of commencement of rick. At the time of signing the proposal form on 15-7-2013, she replied in negative to the questions Nos. “13 (iv), 13 (xiii) and 13 (xv). As the deceased life assured deliberately suppressed the material facts and obtained the insurance cover fraudulently. The complaint is not maintainable and deserves to be dismissed.
14. Smt. Murathoti padmavathamma had submitted certificate of Baptism as age proof along with the proposal form. As per the certificate of Baptism, the date of birth of the deceased is stated as 10-1-1954. However, as per the pensioners details of the Andhra Pradesh Social Security Pensions, Government of Andhra Pradesh the deceased was 72 years old and was drawing pension under pension I.D No. 396191. Hence, as on the date of proposal, as per the records of Andhra Pradesh Social Security Pensions, Government of Andhra Pradesh, the age of the deceased is 72 years. This fact is corroborated with the ages of her family members specifically her son Mr. Anandrao Mooratothi, whose age is 52 years, as per the electoral roll 2013. As the case is fraught with fraud and forgery and should be thoroughly tried in a court of competent jurisdiction. The nature of the complaint and the nature of the evidence produced on record are such that the complainants of this nature cannot be effectively dealt with the summary proceedings. Hence, the complaint may be dismissed.
15. The deceased life assured Murathothi Padmavathamma had mentioned her date of birth as 10-01-1954 in the proposal form dt. 15-7-2013, for insurance cover which means she had mentioned her age as 59 years. It is clear from the documents, place don record that the deceased life assured was 72 years at the time of joining the insurance scheme. If the deceased life assured had disclosed the correct age the opposite parties would not have accepted the proposal and would have rejected the proposal itself. So the insurance cover was obtained fraudulently by suppression of material fact about the age of the deceased life assured. Hence, the present complaint should be dismissed in limine. As per the plan opted by the deceased, the maximum age at entry is 60 years. Hence, the deceased had disclosed her correct age in the proposal form, she would have been found ineligible for the plan opted by her proposal would not have been accepted by the opposite parties.
16. Concealment of the correct facts or misstatement is the failure of the insured to reveal a material fact to the insurer. In the instant case the deceased life assured was suffering from Hypertension and cerebral Vascular Accident, which she did not disclose in the proposal form and also she misstated her age in the proposal form. If the deceased life assured had disclosed that she was suffering from Hypertension and Cerebral Vascular Accident and her correct age i.e. 72 years at the time of taking the policy, the insurance cover would not have been granted to the deceased life assured by the opposite parties. Thus any contract of insurance procured by breach of the principle of “Ustmost Good Faith” is a nullity and void ab-initio. So there is breach of doctrine of utmost good faith and insurer comes to know about the suppression of material facts.
17. The deceased life assured committed a fraud with an intention to obtain the insurance cover by suppressing the history of pre-existing disease and her correct age which was very well within her knowledge. Fraud is an act of deliberate deception with the design of securing something by taking unfair advantage of another. It is cheating to get an advantage. So the complaint dismissed in limine.
18. Section 45 of insurance act 1938 clearly states that the insurer shall have the right of calling for proof of age at any time and such calling for age proof shall not be hit by section 45 of the Insurance Act. The opposite parties have ample evidence on record to prove that there was an understatement of age. The deceased life assured misrepresented her age and thereby induced the opposite parties to grant him the insurance cover. Thus the instant case, the agreement cannot be deemed to be a valid contract in terms of section 10 of the Indian Contract Act 1872 read with section 14 and section 18 together of the said act. Hence, the contract of insurance is void ab initio and hence the repudiation of the claim is just and legal. The complaint should be dismissed in limine. As per section 20 of the Indian Contract Act, 1872, the agreement is void where both parties are under mistake as to matter of fact. Hence, the contract is void ab initio and nothing is payable.
19. There is no deficiency on the part of the opposite parties. Thus the complaint does not fall within the definition of section 2 (1) (c) and section 2 (1) (g) respectively of the C.P. Act as the deceased life assured herself is guilty of suppressing and concealing the material and true facts regarding her pre-existing illness at the time of taking the policy from the opposite parties. Hence, the complaint deserves to be dismissed.
The brief facts of the case:-
The Deceased Life Assured Smt. Murathoti Paadmavathamma had applied for SBI Life Flexi Smart insurance plan with an initial proposal depsit of Rs. 25,000/- and for a sum assured Rs. 2,50,000/- vide proposal No. 56QC652436 dt. 15-7-2013 the said proposal form the deceased had mentioned her date of birth as 10-1954 which means that she had mentioned has age as 59 years. The deceased life assured M. Padmavathamma had appointed her grandson M. Dora Babu, as her nominee under Ex. B1. Smt. M. Padmavathamma had produced certificate of Baptism as age proof along with proposal form Ex. B2.
20. On the proposal form submitted by the deceased life assured and believing the information furnished therein, to be true and accurate, the opposite parties had accepted the risk cover under the doctrine of utmost good faith and issued the policy bearing No. 56048122809 with date of commencement as 25-7-2013 under Ex. B3.
21. The deceased life assured had answered the questions in the proposal form or incorrect and negligently answered medical questionnaire. The deceased life assured at the time of signing the proposal form replied in negative to the question No. 13 (iv), 13 (xiii), 13 (vx) (k) in negative. But the available records prove that the deceased life assured was suffering from Hypertension and Cerebral Vascular Accident prior to the date of commencement of insurance policy. If the deceased life assured disclosed in the proposal form about her preexisting disease and the correct age, the proposal would not have been accepted.
22. The deceased life assured is reported to have died on 26-7-2013. The policy resulted in a claim in July 1st day. So the opposite parties enquired into the matter and found that the deceased life assured was suffering from Hypertension and Cerebral Vascular Accident commencement of the policy and the age of the deceased life assured was incorrect in the proposal form under Ex. B4.
23. As per admission slip and medical notes of RIMS, General Hospital, Kadapa it is evident that the deceased life assured as per case history, she was admitted in the hospital with the complaint of H/o fall in last night, admitted unconscious, Cerebral Vascular Accident, Hypertension, LA diagnosed, which is prior to the date of proposal and the date of commencement of the policy under Ex. B5.
24. As per CT scan report dt. 2-4-2013 of the deceased life assured the Intra cerebral Hemorrhage measuring 4.2x2.7 cm was seen under Ex. B6. As per Andhra Pradesh Pensioners Details of Govt. of Andhra Pradesh the age of the deceased life assured was 72 years under Ex. B7. As per Electoral Roll 2013 the age of the son of the deceased life assured Mr. Anandrao Moorathothi is 52 years. So there is difference between the age of the deceased and his son is only 7 years under Ex. B8.
25. Section 45 of Insurance Act 1983 clearly states that the insurer shall have the right of calling for proof of age at any time and such calling for age proof shall not be hit by section 45 of the Insurance Act and it has been clearly printed on the proposal form submitted by the deceased. Basing on this the insurer repudiated the claim.
26. In the proposal form under point No. 17 the deceased life assured has declared that “I hereby declare that the foregoing statements and answers have been given by me after fully understanding the questions and the same are true and complete in every manner and that I have not withheld any information. Whatever provided false information in reply to any question. I understand and agree that the statements in this proposal constitute warranties. I do hereby agree and declare that these statements and this declaration shall be the basis of the contract of assurance between me and the SBI Life Insurance Co. Ltd., and that if there is any misstatement or suppression of material information or if any untrue statements be contained therein, the said contract shall be absolutely null and void and all money which shall have been paid in respect of thereof shall stand forfeited to the company. Hence, it is humbly prayed that the Hon’ble forum be pleased to dismiss with costs of the company.
27 On the basis of the above pleadings the following points are settled for determination.
- Whether the complainant is entitled to the relief as prayed by him or not?
- Whether there is negligence or deficiency of service on the part of the Respondents?
- To what relief?
28. On behalf of the complainant Ex. A1 to A21 were marked and on behalf of the respondent Ex. B1 to B14 were marked.
29. Point Nos. 1 & 2. It is an admitted fact that the deceased life assured had submitted proposal for SBI Life – Flexi Smart Insurance plan along with plan an initial premium of Rs. 25,000/- and the opposite parties issued premium receipt, dt. 15-7-2013 under Ex. A1. The deceased life assured was insured under policy bearing No. 56048122809 date of commencement of the policy is 27-7-2013 and same was assured for Rs. 2,50,000/-. Ex. B1 is the proposal form issued by the respondent company to the deceased life assured. Ex. B2 is the date of birth certificate issued by Baptism of late deceased life assured is not an authenticated document. Ex. B2 and Ex. A9 are the same. Ex. B3 is the policy copy bearing No. 56048122809. Ex. A2 is the medical certificate which does not support the case of the complainant. Ex. A3 clearly shows that the deceased life assured died on 26-7-2013. Under Ex. A4 which is family certificate of the deceased life assured’s son Mr. M. Ananda Rao, it is clearly shows that the deceased life assured had only one son M. Ananda Rao. When the deceased life assured had son M. Ananda Rao. Why she had nominated her grandson as nominee to her policy, and it creates some doubt to the Dist. Consumer Forum. Ex. A5 is the acknowledgement letter from R2 to the complainant. After the death of the deceased life assured the complainant had issued legal notice under Ex. A6 to R2 for the same reply given under Ex. A7 by R2 to the complainant. As per Ex. A8 family members house hold card the deceased life assured is daily wage earner. When the deceased life assured daily wage earner how she can pay the amount of Rs. 25,000 /- towards premium of the insurance policy, is a suspecting thing. There is so much of difference in her earnings and her policy making by paying premium of Rs. 25,000/-. Ex. A9 is the certificate of Baptism, which is not authenticated certificate to prove of the date of birth of the deceased life assured. In Ex. A10 aadhar card issued by Govt. of India. The photo of the deceased life assured looks to be very old in age. Ex. A11 is the age certificate issued by one doctor P.H. Center, Porumamilla is not competent authority to issue the same. As per Ex. A11 the age of the deceased life assured’s son of M. Anand Rao is only 41 years. Ex. A2 is the notarized affidavit relating to the age of the deceased life assured. The notary is not competent person to give the age certificate. Ex. A12 and A13 both are not authenticated documents to support the case of the complainant.
30. Ex. A14 the signature of the Sarpanch is not clear and sarpanch is not the competent authority go give the death certificate. Ex. A15 to Ex. A21 does not support the case of the complainant. When the complainant asked about the settlement of the claim of the deceased life assured after the death of the deceased life assured, the opposite parties had investigated in to the case under Ex. B4. They found that the deceased life assured was suffering with Hypertension and cerebral vascular accident prior to the date of commencement of the policy and found that the correct age was 72 years. Ex. B5, Ex. B6 clearly shows that the deceased life assured was admitted at RIMS Hospital, Kadapa with Hypertension and cerebral vascular accident. Ex. B6 is the copy of C.T. Scan report dt. 2-4-2013. Ex. B7 clearly shows that the deceased life assured’s age is 72 years and she was drawing old age pension from the Govt. of Andhra Pradesh. Ex. B8 is also electoral roll of 2013, clearly proves the pension details. Ex. B9 copy of product features 72 years age. Ex. B10 is the repudiation letter dt. 3-10-2013 as the deceased life assured was suffering with pre-existing disease, the claim was repudiated. The date of commencement of the policy is 25-7-2013. The deceased died on 26-7-2013 i.e. very next day and it creates some doubt. On the ground of suffering from Hypertension and cerebral vascular accident, the policy was repudiated under Ex. B10 by the respondents. Ex. B12 is the legal notice issued by the counsel of the complainant dt. 7-11-2013. Ex. B14 is the reply legal notice to the complainant from the respondent dt. 15-11-2013.
31. As seen from the above evidence filed by both parties, it is very clear that the deceased life assured had suppressed material facts about her health and fraudulently obtained the insurance policy of her life and that the deceased life assured had given wrong age, while making proposal form. The agreement of contract cannot be deemed to be a valid contract in terms of section 10 of the Indian Contract Act 1872 read with section 14 and section 18 together of the said act. When the deceased life assured misrepresented her age and her health, hence, the contract of insurance is nullity and void ab-initio. So the respondents repudiated the claim of the deceased life assured. Hence, the complainant is not eligible for any compensation as prayed by him. At the same time there is no deficiency of service or negligence on the part of the respondents 1 & 2. The citations filed by the respondents supporting their version in repudiation of the claim of the deceased life assured.
32. Point No. 3 In the result, the complaint is dismissed without costs.
Dictated to the Stenographer, transcribed by him, corrected and pronounced by us in the open Forum, this the 23rd June 201 4.
MEMBER PRESIDENT FAC
APPENDIX OF EVIDENCE
Witnesses examined.
For Complainant NIL For Respondents : NIL
Exhibits marked for Complainant : -
Ex. A1 Proposal deposit receipt dt. 15-7-2013 issued by the R1 to the deceased life assured.
Ex. A2 P/c of medical reports dt. 20-7-2013 issued by the remedy Hospital, Kadapa in the name of the deceased life assured.
Ex. A3 P/c of death certificate dt. 8-8-2013 issued by the Panchayat Secretary, Amagampalli Panchayat.
Ex. A4 Family Members Certificate dt. 9-12-2103 issued by the Tahsildar, S.A.K.N. Mandal, through Mee-seva.
Ex: A5 Acknowledgement letter dt.16-8-2013 given by the respondent no.2 Ex: A6 Office copy of legal notice dt.7-11-2013 sent by the complainant
through his counsel along with postal receipt thereof.
Ex: A7 Letter dt. 15-11-2013 addressed by the respondent no.2 to the
complainant in reply to the legal notice dt.7-11-2013.
Ex: A8 P/c of Household card of the deceased life assured issued by
Tahsildar, SAKN Mandal, Kadapa District.
Ex: A9 Certificate of Baptism dt.14-8-2012 issued by the Pastorate, Diocese
of Nandyal, showing the date of birth of the deceased life assured.
Ex: A10 Photostat copy of Aadhar Card of the deceased life assured.
Ex: A11 Original age certificate of M. Ananda Rao, son of the deceased
Padmavathamma issued by Medical Officer, UPHC Porumamilla.
Ex: A12 Notarised affidavit relating to the age of the deceased
M. Padmavathamma given by M. Ananda Rao.
Ex: A13 Notarised affidavit of M. Ananda Rao with regard to his age.
Ex: A14 Photostat copy of declaration certificate issued by Sarpanch,
Amagampalli Grama Panchayat.
Ex: A15 Colour Photostat coy of Aadhar card of M. Ananda Rao son of the
deceased M. Padmavathamma.
Ex: A16 Photostat copy of 1B extract dated 23-3-2013 in the name of
M. Padmavathamma.
Ex: A17 Photostat coy of 1B extract dated 28-4-2013 issued in the name of
M. Padmavathamma.
Ex: A18 Photostat coy of 1B extract dated 8-5-2013 issued in the name of
M. Padmavathamma.
Ex: A19 Photostat copy of Pattdar Passbook and title deed passbook issued
in the name of M. Padmavathamma.
Ex: A20 Saakshi paper publication relating to Orbituary of the deceased
M. Padmavathamma.
Ex: A21 Dwakra passbook relating to the deceased M. Padmavathamma.
Exhibits marked on behalf of the Respondents:
Ex: B1 Proposal form issued by the respondent company.
Ex: B2 copy of Baptism Certificate issued by the Church of South India,
Diocese of Nandyal.
Ex: B3 Policy copy issued by the respondent company
Ex: B4 Copy of the Investigation report, Dt.14-9-2013.
Ex: B5 Copy of the Admission slip and medical notes of Rajiv Gandhi
Institute of Medical Sciences.
Ex: B6 Copy of the CT Scan Report.
Ex: B7 Copy of Pensioner ID card and list of pensioner.
Ex: B8 Copy of Electoral Roll, 2013.
Ex: B9 Copy of the product features.
Ex: B10 Copy of the Repudiation letter, dt. 3-10-2013.
Ex: B11 Copy of the acknowledgement letter.
Ex: B12 Copy of the Legal notice issued by the counsel of complainant
Dt.7-11-13.
Ex: B13 Copy of Medical Examination Report.
Ex: B14 Copy of Reply to the legal notice issued by the respondent,
Dt. 15-11-13.
MEMBER PRESIDENT FAC
Copy to :-
- Sri K. Vijaya Krishna, Advocate for complainant.
2) Sri T. Jayaram, Advocate for respondents.
B.V.P.
