Haryana

Ambala

CC/194/2014

SUDESH - Complainant(s)

Versus

BIRLA SUN LIFE INSURANACE - Opp.Party(s)

C.L KOHALI

09 Mar 2016

ORDER

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, AMBALA.

Complaint Case No.194 of 2014

Date of Institution:   31.07.2014

Date of Decision  :   09.03.2016

Sudesh wife of late Sh. Angrej Singh  R/o H.No.222, Village Singhana, Tehsil Safedo, District Jind.

                                                                                                            ……Complainant.

Versus

1.         Birla Sun Life Insurance Company Ltd. Ambala through its Branch Manager, Minerva Complex, Rai Market ( Big Bazaar), Ambala Cantt.

2.         Birla Sun Life Insurance Company Ltd. Regd. Office, One India-bulls Center, Tower-1, 15^th & 16^th Floor Jupiter Mill Compound, 841, Senapati Bapat Marg, Elphinstone Road, Mumbai-400601.

3.         Shweta Gupta, Insurance Policy Agent, Birla Sun Life Insurance Company Ltd. Minerva Complex, Rai Market ( Big Bazar), Ambala Cantt.

…..Opposite Parties.

Complaint Under Section 12 of the Consumer Protection Act

CORAM:        SH. A.K. SARDANA, PRESIDENT.

                        SH. PUSHPENDER KUMAR, MEMBER.

 

Present:           Sh. C.L. Kohli, Adv. counsel for complainant.

                        Sh. Puneet Sirpaul, Adv. for Ops No.1 & 2.

           OP No.3 exparte.

ORDER:

                        Present complaint under Section 12 of the Consumer Protection Act, 1986 (hereinafter in short called as the ‘Act’) has been filed by the complainant alleging therein that her husband Angrej Singh, on the asking of OP No.3, got himself insured with OP  Insurance company under BSLI Protector Plan bearing Policy No.005105420 dated 16.09.2011 for a sum of Rs.10.00 lacs  and paid a premium of Rs.2713/- vide receipt dated 16.09.2011. Thereafter, the husband of the complainant expired on 4.10.2011 due to Heart Attack though before death, he was hail and hearty and was enjoying good physique being 37 years old person. At the time of taking insurance policy, complainant was made nominee and after the death of her Husband, complainant is entitled to receive all the amount of insurance and other benefits on account of death of her husband. Complainant submitted all the relevant documents to the Ops  for the claim but the Ops lingered on the matter on one pretext or the other and ultimately repudiated the claim of complainant on 31.10.2012.   So, a legal notice dated 19.09.2013 got served upon the OP-insurance company to make the payment of claim but of no avail. Thus the complainant has alleged that the OP had committed gross negligence in discharge of its liability which clearly amounts to gross deficiency in service on his part. As  such, the present complaint has been preferred by the complainant seeking relief as per prayer clause.

2.                     Notices were served upon the Ops. OP No.3 did not bother to appear despite registered notice. As such, she was proceeded against exparte vide order dated 27.01.2015. Ops No.1 &2 filed their written statement  submitting that  husband of complainant Sh. Angrej Singh was not leading a healthy life rather he concealed the material information regarding his health at the time of purchasing the policy in question to defraud  the answering Ops. It has been further urged by the Ops that since pre-existing disease was not disclosed by the DLA (Deceased Life Assured) at the proposal stage therefore, the Ops have rightly repudiated the claim of the complainant. If true and correct facts were disclosed by DLA at the proposal stage, the Ops would not have issued the policy at existing terms. It has been denied that insured person died due to heart attack rather he died due to pain in abdomen, pyrexia & viral encephalitis. Thus, the answering OP has prayed that the complaint may be dismissed with costs.

3.                     In evidence, complainant tendered her affidavit as Annexure CX alongwith documents as Annexures C-1 to C-8 and closed the evidence whereas on the other hand, counsel for Ops No.1 & 2 has tendered affidavit of Sh. Prasun Pratik, Senior Executive (Legal) BSLI as Annexure RX alongwith documents as Annexures R-1 to R-6 and closed the evidence on behalf of Ops No.1 & 2.   

5.                     We have heard the learned counsel for the parties and gone through the record very carefully. Learned counsel for the complainant argued that claim of the complainant regarding death of her husband Angrej Singh who was insured with OP Insurance Company has been wrongly & illegally rejected by the OP on the ground that the deceased (life assured) was suffering pre-existing disease and died due to pain in abdomen, pyrexia & viral encephalitis rather the life-insured died due to heart attack. The counsel for complainant has placed reliance on case law rendered by Hon’ble National Consumer Disputes Redressal Commission in Revision Petition No.2370 of 2012 titled as Abdul Lateef & others Vs. The Life Insurance Corporation of India & others decided on 04.07.2014 reported in 2014(3) CLT Page 386 wherein it is held that “Insurance claim- Material facts-Fraudulently suppression-Death of insured due to Cancer-Repudiation of Claim on the ground that  insured suppressed the previous illness i.e. bipolar mood disorder-Held- There is no nexus at all between the illness suppressed  and cause of death i.e. Cancer-insured did not suppress any material fact with any fraudulent intention-Revision Petition allowed. The counsel for the complainant also placed reliance on another  case law reported in 2012 (1) CLT Pg. 185 titled as Life Insurance Corporation of India & Another Vs. Ashok Manocha decided by Hon’ble National Commission, New Delhi in Revision Petition No.10 & 11 of 2007. Counsel for complainant further placed reliance on another case law rendered by Hon’ble Andhra Pradesh State Commission reported in 2014(4) CLT Pg. 115 wherein General Observations have been rendered by the Hon’ble Bench that “we have been observing that in a number of cases, the insurance companies are issuing policies basing on the statements made by the proposer in utmost good faith but when it comes to settlement of claims, they start examining the matter under the microscope.  In a majority of policies issued by the insurance companies they were routed through their agents. The agents in their anxiety to get their commission and the insurance company in order to do more and more business see that  the policies are  issued the moment they received the premium amount. Even the insurance companies are not aware as to who is the proposer, what is his /her status or health condition etc.. Here, the intention is very clear that first they induce the people to purchase the policies and later they start litigation.  Even in the instant case also, the proposal was made through agent.  On Ex.B1 we find the rubber stamps of the agent and specified person code and license Nos. on the first and last pages of the proposal.  A  close scrutiny of the proposal form would reveal  even the columns were filled up by the agent and simply obtained the signatures of proposer on ‘x’marks. It is manifest that the proposal was routed through the agent of the LIC.  If we may say so, the agents are playing fraud on LIC as well as gullible consumers with false assurances.  When the policy was issued by the insurance company with utmost good faith, the same yardstick has to be applied while settling  the claims also.  The LIC ought to have made thorough enquiry, investigation or necessary medical health check—ups before issuance of policy irrespective of the amount involved.  Without doing so, when they have issued the policy, now they cannot turn round and contend that they need not pay any amount as there was suppression of material information with regard to his health”.  Besides it, counsel for complainant also placed reliance on plethora of judgments to strengthen his case which are detailed below:-

            (i)        2001(1)CLT Pg 162 (SC) LIC & Others Vs. Asha Goel & others.

(ii)       2001(2) CPC Pg.52 (State Commission Punjab) LIC Vs. Mrs. Neelam Sharma.

(iii)     2000(1) CPC Pg. 543 (State Commission Chandigarh) LIC Vs. Mrs. Asha Rani Khanna.

 

and prayed for acceptance of the complaint.

                        On the other hand, the counsel for Ops has argued that at the time of filling of proposal form, deceased Angrej Singh (life assured) did not disclose true facts about his pre-existing disease intentionally and made a false answer to the questions mentioned in the proposal form.  Had he disclosed the said disease in the proposal form, the OP insurance company would not have issued the policy in question to the life assured. As such, he has played fraud upon the answering OP.  Thus under the terms and conditions of the OP-company, if any information given by the assured person in the proposal form is found false or incorrect, in that event, the contract  become void ab-initio and nothing is payable to the insured person and the amount deposited by him/her shall be forfeited.  Hence, OP have rightly repudiated the claim of the complainant. The counsel for the Ops has placed reliance on case law rendered by Hon’ble Supreme Court of India in Civil Appeal No.2776 of 2002 titled as Satwant Kaur Sandhu Vs. New India Assurance Company Ltd. decided on 10.07.2009 reported in 2009(4) RCR (Civil) Page 692  wherein it has been held that “Insurance Act, 1938, Section 45-Consumer Protection Act, 1986 Sections 2(1)(o)(g) and (c)(xiii)-Insurance Regulating and Development Authority (Protection of Policy holders interests) Regulations, 2002 Regulation 2(1(d)-Repudiations of medical insurance claim-Material Fact-Suppression of  -“Material fact” means  any fact which would influence the judgment of a prudent insurer in fixing the premium or determining whether to accept the risk or not-If the proposer has knowledge of such fact, he is obliged to disclose the same-Failure to do so entitled the insurer to repudiate his  liability under the policy”. The counsel for the Ops also placed reliance on another case law rendered by Hon’ble National Consumer Disputes Redressal Commission, Circuit Bench, Hyderabad in First Appeal No.401/2003 titled as Goparatnam and others Vs. LIC of India & others decided on 27.01.2005 and reported in 2005(2) CLT Page 174 wherein it has been held that “Insurance contract-Held that contract of life insurance is a contract of good faith-Violation of it by any of the party ousts its claim against the other-Appellant having suppressed the information of his past ailment both at the time of revival of the two policies not entitled to any relief”.  Besides it, counsel for Ops also placed reliance on various judgments detailed below:-

1. 2008(1) SCC Pg. 321  P.C. Chacko and another Vs. Chairman, LIC.
2. 2008 (2) CLT Pg. 192 LIC Vs. Piari Devi (Punjab State Commission).
3. LIC Vs. Krishna Devi (NC) decided on 04.09.2013.
4. 2011(IV) CPJ-6 (SC) P.Naidu Vs LIC.
5.  K. Malleswari & Ors Vs.LIC (NC) decided on 03.03.2014.
6. LIC Vs. Shahida Khatoon & Anr. (NC) decided on 10.09.2013.
7. Smt. A. Sujata Vs. LIC (NC) decided on 04.03.2014.
8. LIC Vs. Saroj Devi Devi decided on 05.07.2012 (State Commission Punjab).

 

9. Jaikishan Vs. LIC & Ors (NC) decided on 12.08.2015
10. Kalyan Singh Chouhan Vs. C.P. Joshi (SC) decided on 24.01.2011 and prayed for dismissal of complaint with costs.  

 6.                    At the very outset, it is admitted case of both the parties that Angrej Singh (deceased) got his life assured with the Ops. Perusal of the proposal form Annexure R-2 reveals that it has been filled up by Smt. Shweta Gupta Agent of OP insurance company in English and she simply obtained the signatures of proposer Late Sh. Angrej Singh (which are in Hindi) on the form meaning thereby that the proposal was routed through the agent of OP Insurance company. The main objection of the OP insurance company is that the life assured was suffering from some disease of abdomen, pyrexia & viral encephalitis before issuing of the policy to him. Regarding the alleged illness of the life assured, the Ops have relied upon documents Annexure R-5which is alleged  to be treatment record dated 18.07.2011 & 17.09.2011 of Safdarjung Hospital, New Delhi but from the said documents, it is nowhere proved that the complainant had died due to the disease as alleged by Ops rather it can be taken as that the patient might have died due to heart attack as averred in the complaint.  Further, no any affidavit of concerned doctors to prove the contents of treatment record etc. who treated the patient or issued the alleged OPD slips of alleged diseases  has been placed on file wherefrom it may be concluded that the deceased life assured (DLA) was suffering from alleged disease prior to purchasing the policy in question from Ops and had died due to alleged ailments. Further, the citations referred above submitted by the counsel for complainant are conforming to the facts and circumstances of the present case whereas the citations submitted by counsel for the Ops are not applicable to the facts and circumstances of the present case and thus are not helpful in deciding the case in hand.

7.                     So, from the facts narrated above, we are of the confirmed view that OP- Life insurance company has failed to establish that the cause of death of life assured was  due to ailment alleged by them nor could prove any nexus between the alleged ailment & cause of death and thus the OP insurance company has wrongly repudiated the claim of  the complainant for which she was legally entitled.  Now next  question arises for consideration before the Forum is that after the death of Angrej Singh, whether complainant  alone is entitled to succeed the claim amount from OP Insurance Company. From the perusal of document Annexure R-2 i.e. insurance policy issued by the Ops, it is established that complainant Smt. Sudesh wife of deceased Angrej Singh has been specifically mentioned as nominee of the Life Assured.  So, the complainant  alone is entitled  to succeed the benefits of policy being nominee.  Accordingly, the complaint is allowed and the Ops No.1 & 2 are directed to comply with the following directions within thirty days from the communication of this order:-

(i)        To pay a sum of Rs.10,00,000/- (sum assured as mentioned in Policy Document Annexure C-4) to the complainant alongwith simple interest @ 9% per annum from the date of repudiation of claim i.e. 31.10.2012 to till its actual realization.

 

(ii)       Also to pay a sum of Rs.10,000/- in lump-sum on account of causing mental harassment as well as costs of litigation etc. incurred by the complainant.

                        Further the award in question/directions issued above must be complied with by the OPs No.1 & 2 within the stipulated period failing which all the awarded amounts  shall further attract simple interest @ 12% per annum for the period of default.  Copies of this order be sent to the parties concerned, free of costs.  File be consigned to the record room after due compliance. 

 

Announced:09.03.2016                                                                 Sd/-

                                                                                               (A.K. SARDANA)

                                                                                                          PRESIDENT

                                                                                                                

                                                                                                       Sd/-

                                                                                 (PUSHPENDER KUMAR)                                                                                                                                                                                                     MEMBER