(Passed on 11/05/2023)

Per Mr. Atul D. Alsi, Hon’ble President

1. The complainant has filed a complaint  case against non disbursement and arbitrary repudiation of claim of insurance of Rs. 19,71,000/- for the reason of suppression of material fact for the treatment of diabetes, ischemic heart disease and chronic kidney disease at the time of proposal and thereby claiming insurance claim along with interest and compensation.
2. The complainant is a second wife of insured complainant No. 1 and complainant Nos. 2 and 3 are son of insured from second wife.  The OP No. 3 is a son of first deceased wife of insured. The OP No. 1 who issued insurance policy to the complainant. After the death of first wife, the complainant solemnized second marriage and OP No. 2 and 3 are the sons from second wife. The OP No. 3 is a nominee of insurance policy. The insured died on 7/3/2014 at Nagpur. The OP No. 3 filed insurance claim with OP No. 1 but insurance claim came to be repudiated for the reason of the insured was under treatment of diabetes, heart and kidney disease since long and suppressed this material fact at the time of proposal. The reason for rejection of policy without considering the cause of death and suppression of fact does not have co relation or nexus. Therefore, rejection of insurance claim for the reason thus amounts to unfair trade practice on the part of OP Nos. 1 and 2. Therefore, the petition is filed.
3. The complainant filed insurance policy at document No. 1, proposal form dated 21/03/2014 at document No. 3, death certificate dated 7/4/2014 at document No. 4, repudiation letter at document No. 14.
4. The OP Nos. 1 and 2 filed reply and denied allegations against them and submitted that the complainants are not policy holders nor nominee therefore, not entitled for insurance claim. The nominee is the  OP No. 3 in the policy. The insured had the concealed the material facts regarding health conditions at the time of issuance of policy. Therefore, not entitled for any relief. The insurance policy bearing No. 005319308  was issued to the insured on 11/01/2012.  The insured died on 07/03/2014. The OP No. 3 filed claim application on 20/12/2014 along with death certificate. The deceased claim was investigated and it was  revealed that the insured was suffering from diabetes, ischemic  heart disease and chronic kidney disease and for which he had undergone treatment prior to purchase of policy. However, this material fact was suppressed by insured at the time of application of proposal form. Therefore, rejection of claim on 21/10/2015 for the reason not amounts to unfair trade practice as regards to pre-medical history. It is bounden  obligations to disclose true and material facts as regards to pre-medical history by not disclosing the insured it is  breach of the terms and utmost good faith. Therefore, rejection of claim for the violation of uberrimae fidei is right full repudiation of claim. Therefore, the complaint has no merit  in the present case and liable to be dismissed.
5. The counsel for the complainant argued that the rejection of insurance claim for the reason of suppression of material fact without cogent and reliable evidence and affidavit of concerned doctors for the nexus of cause of death and suppression of fact has not been filed on record. Therefore, repudiation of claim thus amounts to unfair trade practice.
6. The counsel for the OP argued that after investigation for early death claim, it found that the insured had suppressed material facts in respect of health condition for the treatment had been taken for diabetes, heart and kidney disease before purchase of policy. Therefore repudiation of insurance claim is proper.  Therefore, the legal heir of deceased has no right to knock  the door of Court as per judgment of Hon’ble Supreme Court in S.P. Chengalvaraya Naidu by LR’s Vs. Jagannath by LR’s and Others, 1994 I SCC  and as per judgment of Hon’ble Supreme Court in Kishore Samrite  Vs. State of Uttar Pradesh (2013) II SCC 398  has held that the litigants with intent to deceive and mis-leading the Courts without full disclosure of facts and came with unclean hands, therefore, not entitled to any relief. and as per judgment of NCDRC in LIC of India Vs. Smt. Gurvinder Kaur in RP No. 2722 of 2008, decided on 30/05/2013, it is held that it was obligator on the part of insured to give correct answers at the time of obtaining policy. Therefore, suppression of material facts regarding  disease and giving false information amounts to deficiency of service and in that case by repudiating insurance claim, company has not committed any deficiency.

REASONING

7. The insured Somnath Rambali Yadav was insured under policy bearing No. 005319308 from 11/01/2012 by paying annual premium of Rs. 6,234/- for the sum assured of Rs. 19,71,300/-. The deceased was died on 07/03/2014. Therefore, OP No. 3 who is nominee has filed insurance claim on 26/12/2014 along with relevant documents to OP No. 1. The OP No. 1 has repudiated the insurance claim vide letter dated 17/01/2019 for the reason of suppression of material facts in respect of health condition of deceased at the time of purchase of policy.
8. The basic dispute is in respect of the cause of death and the suppression of  treatment taken resulted in repudiation of insurance claim
9. The OP Nos. 1 and 2 have not filed evidence of document on affidavit in  support of Xerox copy of treatment of insured had taken on record to prove its contentions that the insured was under treatment for diabetes, heart and kidney disease and nexus with cause of death. To prove  the contentions of treatment  the burden of proof  lies on opposite parties.There is no co-relationship of cause of death with treatment if any in respect of diabetes, heart and kidney disease.  Hence for want of cogent and reliable evidence, the contentions or defence of Ops has not been proved. Therefore, the rejection of insurance claim for the suppression of material facts is arbitrary. Therefore, the complainant’s and OP No. 3 are equally liable to receive compensation from OP Nos. 1 and 2 as sum assured in the policy bearing No. 005319308 along with compensation and cost of litigation as per following order.

ORDER

1. The complaint is partly allowed.
2. The OP Nos. 1 and 2 shall pay Rs. 19,71,000/- towards insurance claim of policy bearing No. 005319308 in equal proportion to complainant Nos. 1 to 3 and OP No. 3
3. The O.P. shall also liable to  pay to the complainant Rs. 25,000/- towards compensation  for mental  torture  and Rs. 15,000/- towards cost of  litigation to complainant Nos. 1 to 3 and OP No. 3 in equal proportion.
4. Copy of order  be furnished to both the parties free of cost.