Haryana

Karnal

CC/216/2020

Rekha Devi - Complainant(s)

Versus

Bharti AXA Life Insurance Company Limited - Opp.Party(s)

Karam Singh

16 May 2023

ORDER

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION, KARNAL.

                                                        Complaint No. 216 of 2020

                                                        Date of instt.24.06.2020

                                                        Date of Decision:16.05.2023

 

Rekha Devi widow of Late Shri Raj Pal, resident of village Kamalpur Roran, Tehsil Indri, District Karnal.

 

                                               …….Complainant.

                                              Versus

 

1.     Bharti AXA Life Insurance Company Ltd., SCO no.82, 83 1^st, 2^nd floor Mugal Canal, Karnal.

 

2.     Bharti AXA Life Insurance Company Ltd., Spectrum Tower, 3^rd floor, Malad Link Road, Malad (West) Mumbai-400064 Maharashtra.

 

                                                                      …..Opposite Parties.

 

Complaint Under Section 12 of the Consumer Protection Act, 1986 and after amendment Under Section 35 of Consumer Protection Act, 2019.

 

Before   Shri Jaswant Singh……President

              Shri Vineet Kaushik…..Member

              Dr. Rekha Chaudhary…..Member

                   

Argued by: Shri R.K. Mehla, counsel for complainant

                   Shri Vikas Chauhan, counsel for the OPs.

 

                    (jaswant singh, president)

ORDER:    

          

                The complainant has filed the present complaint Under Section 12 of the Consumer Protection Act, 1986 as after amendment under Section 35 of Consumer Protection Act, 2019 against the opposite parties (hereinafter referred to as ‘OPs’) on the averments that the agent of the OPs visited the house of the complainant and asked the husband of complainant that OPs launched an insurance scheme to secure the life of the insured and his family member from any kind of disease, untimely death etc. On the asking of the agent of the OPs, husband of complainant (since deceased) had obtained a policy from OPs, bearing no.501-7216887, valid from 31.03.2018 to 28.03.2038 and paid a premium of Rs.26,425/-. Prior to issue the abovesaid policy, the agent of the OPs got the medical of the complainant and her family members and at that time there was no disease of any kind to any of the family members of the complainant. After taking the aforesaid policy, the husband of complainant was making the installments regularly to the OPs without any default.  The husband of complainant suddenly fell ill. The complainant got treated her husband from various doctors including the PGI GMS Chandigarh, but the husband of the complainant had died on 22.08.2019. The complainant has spent an amount of Rs.50,000/- for performing the last rites. After the death of husband of complainant, complainant gave the necessary information in the office of the OPs. Thereafter, complainant also approached in the offices of the OPs personally and requested to make the payment of the death claim of her husband to his legal heirs and also submitted all the relevant documents in the office of the OPs. At the time of accepting all the documents complete in all respect the officials of the OPs assured complainant that the amount of claim regarding the death of her husband would certainly be passed and given to complainant. Thereafter, complainant approached the OPs several times and requested to pay the death claim of her husband but OPs did not pay any heed to the request of complainant and lingered the matter on one pretext or the other and lastly repudiated the claim of complainant, vide letter dated 23.12.2019 on the false and frivolous ground. In this way there is deficiency in service and unfair trade practice on the part of the OPs. Hence this complaint.

2.             On notice, OPs appeared and filed its written version raising preliminary objections with regard to maintainability and concealment of true and material facts. On merits, it is pleaded that after understanding the key features of the policy, the life assured had signed and submitted the proposal form for insurance. Based on the information provided by the life assured, the OPs had issued the policy bearing no.5017216887. The policy documents alongwith copies of all the supporting documents were dispatched to the life assured. In the proposal form column no.7 (Health Records of Life to be insured) information was sought in respect of past medical history, consultation with doctor, medication, medical advice, disease/disorder etc. and hospitalization within the preceding five years of the life insured and he answered in the negative to all the said questions and based on the said response the OPs were persuaded to issue the policy. It is further pleaded that in column no.9 (Declaration and Authorization) it was stated that the details in the proposal form have been filled in accordance with the information provided, the same is true and correct and has been duly checked and verified and that there was no misstatement. It was also stated that “I declare that should any statement including health declaration be incomplete, false, wrong and inaccurate, or should there be any omission(s) or withholding of information on my/our part, the company shall have the right to cancel the policy or repudiate the claim and forfeit the payments received”. It is further pleaded that the policy was issued on 31.03.2018 and the life insured died on 22.08.2019 i.e. within 17 months of issuance of the policy. A Death Claim was received by the company on 03.10.2019 and the matter was investigated. Since the claim falls in the category of early claim, the company has drawn certain processes of documentation and verification for early claim (within 2 years of issuance of the policy). On investigation, it was found that the life assured was suffering from Chronic Liver Disease prior to issuance of the policy and was under treatment for the same and he also had a habit of alcohol consumption in large quantity. This history was prior to his proposal for insurance and before issuance of the policy.

3.             It is further pleaded that this medical history was prior to the life insured filing the proposal form for the policy and the answers furnished by him were thus false and he had given false and misleading information to the OPs. During investigation the record dated 15.03.2018 (Just prior to the proposal for insurance) of Government Medical Hospital, Chandigarh was found from which it was clarified that the insured Rajpal was a known case of Chronic Liver Disease (Alcohol Abuse) and had visited the hospital with Chief Complaints of Blood Vomiting (5-7 episodes with clots) and black tangy stool. This medical record clearly reveals that the complainant was a patient of Chronic Liver Disease and Alcohol Abuse and was under treatment for the same. It is further pleaded that from further investigation by two separate investigators it was that the husband of complainant had got treatment done from Amritdhara Hospital where he was admitted from 18.07.2019 to 22.07.2019 and was diagnosed of Chronic Liver Disease/Cirrhosis/PHTN, Eshophaegeal Varice, etc. and also visited the Government Medical College and Hospital for the same disease on 17.07.2019. The record was procured from Rajiv Rana Path Lab and Bharat x-ray and ultrasound clinic where it was clarified that the life assured was suffering from these problems. Infact, Dr. Balbir Chaudhary of Sector-14, Karnal has also certified the same and even mentioned that the insured was a suffering from cancer. The said diagnose and treatment was not intimated to the company though it was prior to issuance of the policy and was required to be informed in terms of the proposal form and policy. The OPs had accordingly repudiated the claim lodged by the complainant for non-disclosure/suppression of material information by way of claim Repudiation Letter dated 25.12.2019. In the said letter, it was specifically stated that in case the complainant was not satisfied with the same they could approach the grievance redressal mechanism, however, rather than doing so the complainant filed the present complaint. There is no deficiency in service and unfair trade practice on the part of the OPs. The other allegations made in the complaint have been denied and prayed for dismissal of the complaint.

4.             Parties then led their respective evidence.

5.             Learned counsel for the complainant has tendered into evidence affidavit of complainant Ex.CW1/A, copy of proposal form Ex.C1, cop of premium receipt Ex.C2, copy of repudiation letter dated 23.12.2019 Ex.C3, copy of death certificate Ex.C4 and closed the evidence on 26.05.2022 by suffering separate statement.

6.             On the other hand, learned counsel for the OPs no.1 and 2 has tendered into evidence affidavit of Ayan Chakraborty, Senior Manager Ex.OP1/A, copy of customer declaration form Ex.OP1, copy of proposal form Ex.OP2, copy of Indian Post Office tract report Ex.OP3, copy of claimant statement form Ex.OP4, copy of medical record Ex.OP5, copy of claim investigation report Ex.OP6, copy of medical record of Amritdhara Hospital Ex.OP7, copy of repudiation letter Ex.OP8 and closed the evidence on 17.03.2023 by suffering separate statement.

7.             We have heard the learned counsel of the parties and perused the case file carefully and have also gone through the evidence led by the parties.

8.             Learned counsel for complainant, while reiterating the contents of the complaint, has vehemently argued that on 31.03.2018 the husband of complainant (since deceased) had purchased a life insurance policy from the OPs. The husband of complainant died on 22.08.2019.  After the death of her husband, complainant being nominee lodged the death claim with the OPs and submitted all the required documents for settlement of the claim. The claim of the complainant has wrongly and illegally been repudiated by the OPs on 23.12.2019 on the false and frivolous grounds and lastly prayed for allowing the complaint.

9.             Per contra, learned counsel for the OPs, while reiterating the contents of written version, has vehemently argued that the claim of the complainant has been repudiated by the OPs on the ground that deceased life assured (DLA) had concealed the true and material facts regarding his health at the time of filling the proposal form. As per the proposal form, the deceased life insured (DLA) had declared that he was not suffering from any disease but during the investigation and as well as medical reports it was also found that DLA was suffering Chronic Liver Disease and taken treatment from Government Medical Hospital, Chandigarh, so the said claim was rightly repudiated by the OPs and prayed for dismissal of the complaint.

10.           We have duly considered the rival contentions of the parties.

11.           Admittedly, on 31.03.2018 deceased life assured had purchased the policy in question. It is also admitted that complainant is the nominee in the said policy.

12.           The claim of the complainant has been repudiated by the OPs, vide repudiation letter Ex.C3/OP8 dated 23.12.2019, which is reproduced as under:-

“The policy in question was issued to the life inured on the basis of his proposal for insurance dated 31.03.2018. In the said proposal, the life insured had replied in negative to questions nos. 5(3) & 7(4)(b). The said questions and replies thereto in the proposal:

                Lifesytle and personal details

3. Do you consume Alcohol?                                = No

4. Have you ever had or received medical

    Advice or treatment for any of the following/

 b. asthma or any respiratory disease, kidney or

    urinary tract disease, mental or nervous disease,= No

    liver disease, any blood disorder (including

   aneamia), any digestive or bowel disorders

   (including throid disorders), disorders of ears or

   eyes, problem of stones in any organ in the body.

 As per documents collected at claims stage, it has been proved that the life insured had a habit of alcohol consumption in large quantity and was a known case of Chronic Liver Disease since prior to policy and was on treatment for the same. This history is prior to him signing the proposal for insurance and hence the aforesaid replies were false.

In view of the above, it is clear that the life insured has given false and misleading information to the company and had the life insured replied to the aforesaid questions truthfully and correctly in the proposal form, the company would not have issued the above mentioned policy at all. It is event that the company has been led to issue the policy by suppressing material facts regarding his past medical history.

In the said circumstances, the company is therefore repudiating the claim for non-disclosure of medical history at the time of proposal for insurance.

    

 

13.           The claim of the complainant has been repudiated by the OPs on the ground of non-disclosure of medical history at the time of obtaining the insurance policy. The onus to prove that the life assured was having pre-existing disease, prior to commencement of the policy was relied upon the OPs. To prove its version, OPs have relied upon the treatment record Ex.OP5 dated 15.03.2018, on perusal of said medical record, it has been proved that the deceased life assured has taken treatment from Government Medical Hospital, Chandigarh, from the said medical record it is also clarified that the insured Rajpal was a known case of Chronic Liver Disease (Alcohol Abuse) and had visited the hospital with Chief Complaints of Blood Vomiting (5-7 episodes with clots) and black tangy stool. It is also evident from the discharge summary Ex.OP7 dated 22.07.2019 of Amritdhara hospital, Karnal that the life assured was diagnosed for chronic liver disease. These medical records clearly reveals that the complainant was a patient of Chronic Liver Disease and Alcohol Abuse and was under treatment for the same and deceased life assured had concealed these facts at the time of purchasing the policy. To rebut the said treatment record, complainant has miserably failed to produce any cogent and convincing evidence. Thus, it has been proved on record that deceased life assured was having pre-existing disease and had concealed the true and material facts regarding his health at the time of purchasing the insurance policy. The cause of death due to chronic liver disease cannot be ruled out. The complainant has also failed to place on file any evidence or medical record to prove the cause of death of life assured.

 14.          Furthermore, as per Section 45 of the Insurance Act, 1938, it is mandatory for a policyholder to declare the other policy or policies held by him/her in the claim form with the claiming insurer. In this regard, we are fortified with the observations of Hon’ble Supreme Court in case titled as Branch Manager, Bajaj Allianz Life Insurance Company Ltd. and others Vs. Dalbir Kaur in civil appeal no.3397 of 2020 decided on 09.10.2020 wherein Hon’ble Supreme Court held that a policy of insurance is governed by the principles of utmost good faith. The suppression of material facts by the insured/policyholder entitles the OP to repudiate the policy under section 45 of the Insurance Act. The said authority is fully applicable to the facts of the present case.

15.           It is settled principle of law that contract of insurance is a contract uberrima fides and utmost faith must be observed by the contracting parties. Every material fact must be disclosed, otherwise there is good ground for rescission of contract. If, there are misstatements or suppression of material facts, the policy can be called into question. In this regard, we fortified with the observation of the Hon’ble Supreme Court in case titled Satwant Kaur Sandhu Versus New India Assurance Co. IV( 2009) CPJ 8 (SC) and judgment of Hon’ble National Commission in case Life Insurance Corporation of India and another Versus Bimla Devi Revision Petition no.3806 of 2009 decided on 12.8.2015.

16.           In the present case, life assured had concealed the true and material facts regarding his health at the time of purchasing the policy in question. Hence, we are of the considered view that OPs have rightly repudiated the claim of the complainant.

17.           Thus, in view of the above, present complaint is devoid of any merits and same deserves to be dismissed and the same is hereby dismissed. No order as to costs.  The parties concerned be communicated of the order accordingly and the file be consigned to the record room after due compliance.

Dated:16.05.2023                                                                      

                                                                  President,

                                                     District Consumer Disputes

                                                     Redressal Commission, Karnal.

 

(Vineet Kaushik)        (Dr. Rekha Chaudhary)

                    Member                         Member