Chandigarh

DF-II

CC/348/2020

Sartaj Singh - Complainant(s)

Versus

Bajaj Allianz Life Insurance Co. Ltd. - Opp.Party(s)

Paras Money Goyal

24 Aug 2023

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION-II

U.T. CHANDIGARH

 

Consumer Complaint No.	:	348/2020
Date of Institution	:	10.08.2020
Date of Decision	:	24.08.2023

 

                     

            

 

Sartaj Singh s/o Late Sh.Pritpal Singh r/o H.No.2144, Phase-7, Sector 61, SAS Nagar, (Mohali), Punjab-160059

                 ...  Complainant.

Versus

 

1.  Bajaj Allianz Life Insurance Company Ltd., Regd. Office at Bajaj Allianz House, Airport Road, Yerawada, Pune-411006

    2^nd Address: Branch Office at SCO No.215-217, Top Floor, Sector 34-A, Chandigarh

 

2.  Bajaj Housing Finance Ltd., 1^st & 2^nd Floor, SCO 57, 58 & 59, Sector 17-A, Opposite to Hotel Taj, Chandigarh 160017.

…. Opposite Parties

BEFORE:
	SHRI AMRINDER SINGH SIDHU,	PRESIDENT
	SHRI B.M.SHARMA	MEMBER
PRESENT:-
	Ms.Archana, Adv .Proxy for Sh.Paras Money Goyal,  Counsel of complainant Ms.Monika Thatai, Adv. Proxy for Sh.Nitin Thatai, Counsel of OP No.1 Sh.Amrit Kashyap, Adv. Proxy for Sh.Hitender Kansal, Counsel for OP No.2.

 

   

ORDER BY AMRINDER SINGH SIDHU, M.A.(Eng.),LLM,PRESIDENT

1.     The complainant has filed the present complaint pleading that the father of the complainant namely Sh.Pritpal Singh availed the loan of Rs.43.00 lakhs from OP No.2 for the purchase of H.No.2144, Phase-7, Sector 61, SAS Nagar, (Mohali), Punjab by virtue of the sale deed dated 02.11.2018 (Annexure C-1) and in the said loan, the complainant and her mother Inderjeet Kaur are also co-applicants. The complainant’s father opted for an insurance policy which covers the loan amount in the event of death of borrower by paying the premium of Rs.2,26,465/- + Rs.72000/- and there was an option for making the payment of the premium with interest in EMIs and as such the complainant opted to pay the premium in installments and he has been paying a sum of Rs.44,902/- towards the EMI for the loan of Rs.43.00 lakhs and Rs.3227/- towards the premium of the policy. The complainant was rest assured that in the event of insured death during the loan period, the loan shall be covered under the policy and legal heirs will not have to pay an EMI. The total loan amount was to be paid by the father of the complainant since he was the principal applicant, aged about 63 years on the date of taking the policy. Though it was an understanding that the entire loan amount would be covered in the event of the death of the father of the complainant yet later it transpired that the OPs themselves bifurcated the loan into two parts and gave the coverage of Rs.22,85,180/- in favour of the father of the complainant and remaining to the complainant, which was not required. Unfortunately, the father of the complainant namely Sh.Pritpal Singh died on 23.08.2019 and the claim was lodged with the OPs for reimbursement of the loan amount. The OPs vide letter dated 31.12.2019 (Annexure C-7)  repudiated the claim on the ground that the LA-Sh.Pritpal Singh had a history of coronary artery bypass in 2005 and underwent angioplasty in 2012 and it was alleged that he was suffering from Diabetes Mellitus Type-2 since 2018 and the said information was not mentioned in the proposal form dated 10.11.2018. The complainant vide letter dated 23.01.2020 (Annexure C-8) informed that no proposal form dated 10.11.2018 was ever filled up by the complainant or his father or copy thereof was supplied to him at the time of taking the policy and loan. The OPs again issued the letter (Annexure C-9) reiterating the contents of the repudiation letter and confirmed the repudiation of the claim. Aggrieved against the repudiation of the claim, the complainant has filed the present complaint taking the specific stand that no proposal form dated 10.11.2018 was ever filled up by the complainant or his father at the time of taking the policy and as such no question arises for any concealment of the fact/mis-description of the fact. Alleging that the aforesaid acts of omission and commission on the part of the OPs amount to deficiency in service and unfair trade practice, the complainant has filed the instant complaint seeking directions to the OPs to make payment of Rs.22,85,180/- directly to OP No.2 and refund the proportionate payment of EMIs of loan as well as of the policy, which is being illegally charged by the OP No.2 after the death of the father of the complainant with interest, compensation for mental agony and physical harassment as well as litigation expenses.
2.     After service of notice, OP No.1 appeared before this Commission and filed their written version stating that they received an application for Group Credit Protection Plus which was lodged in the system on 06.10.2018 from the LA-Pritpal Singh for insurance on his life. Before accepting of the proposal form submitted by the insured at the instance of OP No.2 for securing the repayment of the loan, the contents of the same were read and explained to the deceased LA and thereafter the certificate of insurance bearing Master Policy No.0342306206 and membership No.0352111763 having commencement of risk from 06.11.2018 with sum assured of Rs.22,85,180/- against the premium of Rs.2,26,465.60 was issued. On receipt of the claim, the same was investigated and during investigation, it came to light that Sh.Pritpal Singh did not disclose in the enrolment/membership form about the pre-existing diseases he was suffering from. Sh.Pritpal Singh was a known case of CAD (Coronary Artery Disease) with Hypertension and had history of CABG (Coronary Artery Bypass Grafting) since 2005 and underwent stenting in 2012 from Fortis Hospital Mohali vide No.IP00136860 FHL having No.00036439 date of and IPD Admission 02.06.2012 and date of Discharge as 05.06.2012. Since the aforesaid material information was concealed by the deceased life assured, therefore, the death claim was repudiated vide repudiation letter dated 31.12.2019. Had the correct information been provided to the opposite party by the DLA at the time of application for insurance, they would have declined the application. The remaining allegations have been denied, being false. Pleading that there is no deficiency in service on their part, OP No.1 prayed for dismissal of the complaint.
3.     In its separate written statement, OP No.2 has admitted that the complainant and his parents applied for loan for Rs.50.00 lacs  for purchase of house and the loan of Rs.43.00 was sanctioned vide letter dated 30.09.2020 after verifying the documents and it was the duty of the complainant and other co-borrowers to ensure that the property offered as security is duly insured for an equivalent to the loan amount.   It has further been stated that they are only the facilitator and it is the sole discretionary of OP No.1 to accept and reject for issuance of issuance policy and any claim arise out from the insurance policy.  It has further stated that on the request of the complainant and other co-borrowers, the loan facility was refinanced by them and the complainant and his father applied for a fresh insurance with OP No.1 for insuring the loan facility. The remaining allegations have been denied, being false. Pleading that there is no deficiency in service on their part, OP No.2 also prayed for dismissal of the complaint qua it.
4.     The complainant filed replication to the written reply of OP No.1 controverting their stand and reiterated the contents of the complaint.
5.     The parties filed their respective affidavits and documents in support of their case.
6.     We have heard the Counsel for the contesting parties and have gone through the documents on record including written submissions.
7.     The main issue involved in the present complaint is that whether the OP No.1-Insurance Company repudiated the claim of the complainant wrongly and arbitrarily or not?
8.     In order to find out answer to the above mentioned issue, it is important to take into consideration the following facts and circumstances of the present complaint.
9.     The complainant alleged that the OP No.1-Insurance Company repudiated the claim vide letter dated 31.12.2019 (Annexure C-7) on the ground that the LA-Sh.Pritpal Singh had a history of Coronary Artery Bypass in 2005 and underwent angioplasty in 2012 and he was suffering from Diabetes Mellitus Type-2 since 2018 and the said information was not mentioned in the proposal form dated 10.11.2018. The complainant vide letter dated 23.01.2020 (Annexure C-8) informed the Insurance Company that no proposal form dated 10.11.2018 was ever filled up by the complainant or his father or copy thereof was supplied to them at the time of taking the policy and availing the loan.
10.     So the complainant struck at the root cause of the repudiation of the claim by challenging the fact that the proposal form dated 10.11.2018 was neither filled up by him or his father, hence the question of concealment of the fact/mis-descrpition of the fact by the complainant or his father does not arise at all. The complainant further took a stand that he or his father never signed the alleged proposal form dated 10.11.2018. In view of the stand taken by the complainant, the presumption is that the complainant or his father neither signed nor filled up the alleged proposal form dated 10.11.2018. OP No.1-Insurance Company has failed to rebut the aforesaid stand of the complainant in any manner. They can rebut the same by leading expert evidence to this effect or proving the same by placing on record the endorsement of any postal authority that the copy of the proposal form dated 10.11.2018was supplied to the complainant or his father.
11.     That it is usual with the insurance company to show all types of green pasters to the customer at the time of selling insurance policies, and when it comes to payment of the insurance claim, they invent all sort of excuses to deny the claim. In the facts of this case, ratio of the decision of Hon’ble Apex Court in case of Dharmendra Goel Vs. Oriental Insurance Co. Ltd., III (2008) CPJ 63 (SC) is fully attracted,  wherein it was held that, Insurance Company being in a dominant position, often acts in an unreasonable manner and after having accepted the value of a particular insured goods, disowns that very figure on one pretext or the other, when they are called upon to pay compensation.  This ‘take it or leave it’, attitude is clearly unwarranted not only as being bad in law, but ethically indefensible.  It is generally seen that the insurance companies are only interested in earning the premiums and find ways and means to decline claims. In similar set of facts the Hon’ble Punjab & Haryana High Court in case titled as New India Assurance Company Limited Vs. Smt.Usha Yadav & Others 2008(3) RCR (Civil) Page 111 went on to hold as under:-

    “It seems that the insurance companies are only interested in earning the premiums and find ways and means to decline claims. All conditions which generally are hidden, need to be simplified so that these are easily understood by a person at the time of buying any policy.  The Insurance Companies in such cases rely upon clauses of the agreement, which a person is generally made to sign on dotted lines at the time of obtaining policy. Insurance Company also directed to pay costs of Rs.5000/- for luxury litigation, being rich.

12.     In view of the above discussion, we have no hesitation to held that OP No.1-Insurance Company has wrongly and arbitrarily repudiated the claim of the complainant on the ground of non-disclosure of material facts because the OPs have failed to rebut the presumption that the proposal form dated 10.11.2018 was neither filled up and signed by the complainant or his father.
13.     In view of the reasons stated above, the present complaint deserves to be partly allowed and the same is accordingly partly allowed. OP No.1-Insurance Company is directed to pay Rs.22,85,180/- directly to OP No.2 and to refund the proportionate payment of EMIs of loan as well as of the policy which is being wrongly charged by OP No.2 after the death of the father of the complainant, to the LRs of the insured in equal shares as per law along with interest @ 10 % p.a. from the date of repudiation of the claim till the date of its actual realization of the amount.
14.      This order be complied with by the OPs jointly and severally, within 60 days from the date of receipt of its certified copy.
15.     The pending application(s) if any, stands disposed of accordingly.
16.     Certified copy of this order be sent to the parties, as per rules. After compliance file be consigned to record room.

Announced 24/08/2023
	Sd/-  (AMRINDER SINGH SIDHU) PRESIDENT
	Sd/- (B.M.SHARMA) MEMBER