Chandigarh

DF-I

CC/722/2021

Kiran Chaudhary - Complainant(s)

Versus

Bajaj Housing Finance Ltd. - Opp.Party(s)

Ashwani Arora

08 May 2023

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION-I,

U.T. CHANDIGARH

 

                    

Consumer Complaint No.	:	CC/722/2021
Date of Institution	:	19/10/2021
Date of Decision	:	08/05/2023

 

Kiran Chaudhary wife of Late Sh.Ashok Chaudhary, R/o Flat No.1415, Ground Floor, Rosewood Estate Phase-2, Derabassi, District SAS Nagar (Mohali) Punjab.

2^nd address: H.No.3191-A Sector 31-D, Chandigarh.

… Complainant

V E R S U S

1. Bajaj Housing Finance Limited through its Branch Manager, SCO 156-159, 2^nd Floor, Sector-9, Madhya Marg, Chandigarh.
2. Bajaj Allianz Life Insurance Co. Ltd., through its Branch Manager, SCO 156-159, 2^nd Floor, Sector-9, Madhya Marg, Chandigarh.

… Opposite Parties

CORAM :	PAWANJIT SINGH	PRESIDENT
	SURJEET KAUR	MEMBER
	SURESH KUMAR SARDANA	MEMBER

 

                                                

ARGUED BY	:	Sh.Devinder Kumar, and Sh. Ashwani Arora, Counsel for Complainant.
	:	Sh.Sameer Mahajan, Counsel for OP No.1.
	:	Sh.Nitin Thatai, Counsel for OP No.2.

 

Per Surjeet kaur, Member

1.      Averments are that the husband of the complainant had died on 20.04.2021. He had taken a home loan amounting Rs.22,60,000/- from the OP No.1. The tenure of the loan was for 126 months and the monthly EMI was of Rs.26,597/-. The said loan was insured with OP No.2 under the scheme of Group Credit Protection Single (GCPL) for a sum of Rs.12,57,020/- at a total premium of Rs.80,000/- vide policy No.035067874 dated 12.10.2018 for a period of seven years (Annexure C-1 to C-3). After availing the loan, the deceased was assured by the OPs that in case anything happens to him during the policy period, the OP No.2 will pay the insured loan amount. The complainant was the nominee under the said policy. As per the insurance certificate, the policy holder was covered under the critical illness cover with Rs.12,57,020/-. After the death of Sh.Ashok Kumar Chaudhary, the Ops were informed and provided all the medical records by the complainant and were being requested to adjust the insured amount from the home loan amount and also to start charging revised EMI after necessary adjustment. But the OP NO.2 repudiated/rejected the claim of the complainant vide letter dated 19.08.2021 on the ground that the deceased Sh.Ashok Kumar Chaudhary was old case of DM (diabetes Mellitus) single disease and chronic kidney disease stage V which was pre-proposal and he had concealed the facts from the OP resulting into fraud (Annexure C-6). It is also submitted that the OP No.2 has repudiated the claim of the complainant in arbitrary manner which is against the guidelines issued by the IRDA from time to time. Hence, is the present consumer complaint.
2.     OP No.1 contested the consumer complaint, filed its written statement and stated that the present complaint is liable to be dismissed on the ground that the rendition of accounts by the bank, recovery of amount or reconciliation and/or settlement of accounts are reliefs that can be obtained in a Civil Court and not in Consumer Courts. It is further submitted that it has no role to play in this entire complaint filed by the complainant. It has just provided the finance facility to late husband of the complainant and complainant on their approaching the officials of OP No.1. It is the complainant’s late husband who has opted for insurance from OP No.2 and the grievance qua the policy/insured amount is in the regard to dispute with OP No.2. The complainant while taking the insurance policy from OP No.2 singed the acknowledgement-cum-consent letter dated 12.09.2018 executed and signed at Chandigarh by husband of the complainant (Annexure R-4). On these lines, the case is sought to be defended by OP No.1.
3.     OP No.2 contested the consumer complaint, filed its written statement and stated that the DLA had not given a correct information regarding his pre-existing disease i.e. Type II Diabetes, Coronary Artery Disease alongwith eye problem and also kidney problems because of which he was under treatment of dialysis. The DLA also used to smoke 20 cigarettes per day and had a family history of diabetes mellitus. It would not have issued the insurance policy on the existing terms and conditions, hence, no illegality has been confirmed by the answering OP while repudiating the claim of the complainant. From perusal of the medical documents, it was evident that the DLA hd a past history of diabetes, coronary artery disease alongwith eye problems and also kindey problems because of which he was under treatment of dialysis since 2014 i.e., before the inception of the insurance policy. It is further submitted that the answering OP decided to investigate the matter and hired an investigation agency by the name of Guru Associates who submitted its report on 31.07.2021. It is relevant to mention here that the DLA was suffering from various ailemnts like diabetes mellitus type2, Pseudophakia, coronary artery disease, eye problems prior to issuance of the insurance policy. The DLA was taking the medical treatment from Command Hospital, Chandimandir. These facts were not disclosed and also concealed by the DLA to the answering OP at the time of issuing the insurance policy. Copy of investigation report and medical record of the DLA is annexed as Annexure OP-2/4 & OP-2/5. On these lines, the case is sought to be defended by OP No.2.
4.     Rejoinder was filed and averments made in the consumer complaint were reiterated.
5.     Parties led evidence by way of affidavits and documents.
6.     We have heard the learned counsel for the parties and gone through the record of the case.
7. The grouse of the complainant through the present complaint is that the genuine claim of the husband of the complainant  has been repudiated illegally/arbitrarily who has already died on 20.4.2021.
8. The stand taken by the OP No.2 is that it was the insured who concealed various facts about his unhealthy physical condition as the facts were not disclosed and concealed at the time of taking the insurance policy. Hence, the same is repudiated on genuine ground and prayed for the dismissal of the complaint.
9. After going through the documents on record it is evident from Annexure C-3 that the complainant’s husband i.e. the proposed insured paid premium of Rs.80,000.46/- and the sum insured for the aforesaid policy was Rs.12,57,020/-. It is an admitted fact that the insured in question died on 20.4.2021, i.e. after three years of the commencement of the policy in question.
10. Annexure C-6 is the repudiation letter dated 19.8.2021 relevant portion whereof is as under:-

“As per medical records, late Ashok Chaudhary was known case of DM (Diabetes mellitus) single vessel disease and chronic kidney disease stage V which was pre-proposal. This fact was deliberately and fraudulently suppressed in the proposal form dated 13-Oct-2018, with an intention to deceive the insurer and induce the insurer to issue the policy, resulting into fraud (active concealment of a fact by the insured having knowledge or belief of the fact).”

11. There is mention at para 5 A of the reply of OP No.2  that the husband of the complainant after careful consideration agreed to buy the insurance policy namely Group Credit Protection Plan”  and paid Rs.80,000/- in single payment mode  towards the premium  for a term of 7 years. The date of risk commencement was from the date of loan  i.e. 12.10.2018 and the sum insured in the policy was Rs.12,57,020/-  and the complainant was the nominee in the said policy. We find force in the contention of OP No.2 and are of the opinion that the complainant after verifying various facts of course after getting clarified relevant terms and condition of the policy must have been purchased the policy in question.
12.  Undoubtedly, the policy in question was very important one for which the complainant paid hefty amount of Rs.80,000/- as single premium. The type of detailed investigation which was done by the OPs after the death of the insured must have been conducted prior to the issuance of the policy also by conducting proper investigation by team of expert doctors. It seems very clever tactics of the OP No.2, charging hefty premium from gullible consumers and thereafter repudiating the genuine claim by taking shelter of their vague and unilateral terms and conditions.
13. Even otherwise the OP No.2 cannot reject the claim of the insured on the ground of concealment of material fact as it is the duty of the insurer to get due information after assessing the medical condition of the insured  to fill in the proposal form prior to issuance of policy. The Hon’ble Apex Court in its latest judgment in the case of Manmohan Nanda Vs. United India Assurance Co. Ltd. & Anr., 2022(1) RCR (Civil) 449, after considering the various judgments passed by it in earlier cases, held that following principles emerged in the cases of medical claims repudiated on the ground of pre-existing disease:-

“52. On a consideration of the aforesaid judgments, the following principles would emerge:

(i)     There is a duty or obligation of disclosure by the insured regarding any material fact at the time of making the proposal. What constitutes a material fact would depend upon the nature of the insurance policy to be taken, the risk to be covered, as well as the queries that are raised in the proposal form.

(ii)    What may be a material fact in a case would also depend upon the health and medical condition of the proposer.

(iii)   If specific queries are made in a proposal form then it is expected that specific answers are given by the insured who is bound by the duty to disclose all material facts.

(iv)    If any query or column in a proposal form is left blank then the insurance company must ask the insured to fill it up. If in spite of any column being left blank, the insurance company accepts the premium and issues a policy, it cannot at a later stage, when a claim is made under the policy, say that there was a suppression or non­disclosure of a material fact, and seek to repudiate the claim.

(v)     The insurance company has the right to seek details regarding medical condition, if any, of the proposer by getting the proposer examined by one of its empanelled doctors. If, on the consideration of the medical report, the insurance company is satisfied about the medical condition of the proposer and that there is no risk of pre­existing illness, and on such satisfaction it has issued the policy, it cannot thereafter, contend that there was a possible pre­existing illness or sickness which has led to the claim being made by the insured and for that reason repudiate the claim.

(vi)    The insurer must be able to assess the likely risks that may arise from the status of health and existing disease, if any, disclosed by the insured in the proposal form before issuing the insurance policy. Once the policy has been issued after assessing the medical condition of the insured, the insurer cannot repudiate the claim by citing an existing medical condition which was disclosed by the insured in the proposal form, which condition has led to a particular risk in respect of which the claim has been made by the insured.

(vii) In other words, a prudent insurer has to gauge the possible risk that the policy would have to cover and accordingly decide to either accept the proposal form and issue a policy or decline to do so. Such an exercise is dependant on the queries made in the proposal form and the answer to the said queries given by the proposer.”

 

14. The principle of law laid dawn by the Hon’ble Apex court in the afore-extracted case is squarely applicable  to the fact and circumstances of the instant case. Hence, there is deficiency on the part of the OP No.2 by repudiating the genuine claim of the complainant.  
15.     In view of the above discussion, the present consumer complaint succeeds and the same is accordingly allowed. OP No.2 is directed as under:-

1. To pay insured amount of ₹12,57,020/- to the complainant alongwith interest @ 9% per annum from the date of repudiating the claim till realization. The said amount shall be paid by the complainant to the OP No.1 towards adjustment of loan amount.
2. to pay an amount of ₹50,000/- to the complainant as compensation for causing mental agony and harassment to her;
3. to pay ₹20,000/- to the complainant as costs of litigation.

16.     This order be complied with by the OP No.2 within thirty days from the date of receipt of its certified copy, failing which, it shall make the payment of the amounts mentioned at Sr.No.(i) & (ii) above, with interest @ 12% per annum from the date of this order, till realization, apart from compliance of direction at Sr.No.(iii) above.
17. Complaint against OP No.1 stands dismissed.
18.     Certified copies of this order be sent to the parties free of charge. The file be consigned.

08/05/2023			Sd/- [Pawanjit Singh]
Ls/mp			President
			Sd/-
			[Surjeet Kaur]
			Member
			Sd/-
			[Suresh Kumar Sardana]
			Member