BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM

VAZHUTHACAUD, THIRUVANANTHAPURAM.

PRESENT

SRI. G. SIVAPRASAD : PRESIDENT

SMT. BEENAKUMARI. A : MEMBER

SMT. S.K.SREELA : MEMBER

C.C. No. 254/2006 Filed on 19.09.2006

Dated : 16.04.2011

Complainant :

S. Geetha Kumari, Kuzhivila Puthen Veedu, Mudakkal P.O, Mudakkal, Village (via) Avanavanchery.

(By adv. R. Kesavan Nair)

Opposite parties :

1. Branch Manager, L.I.C of India, Kilimanoor Branch.

    

2. Divisional Manager, L.I.C of India, Divisional Office, Jeevan Prakash, Pattom, P.B. No. 1001, Thiruvananthapuram.

(By adv. S.S. Kalkura)

This O.P having been heard on 16.03.2011, the Forum on 16.04.2011 delivered the following:

ORDER

SRI. G. SIVAPRASAD: PRESIDENT

The facts leading to the filing of the complaint are that the husband of the complainant, while he was in service took a policy of insurance bearing No. 782510774 from the 1^st opposite party under the Kerala Government Salary Deduction Scheme and the first deduction towards the premium has been effected from his salary for the month of 04/05, that the life assured expired on 11.07.2005, that after his demise, complainant, the wife of the insured, filed a claim petition for the sum assured for Rs. 50,000/-, that opposite party informed her that there was evidence to show that the assured was diagnosed as calcific pancreatitis in 1996 and was diabetic, that the insured did not disclose these facts at the time of taking policy, that the insured had made deliberate mis-statement and withheld material information from them regarding his health at the time of effecting the assurance and hence in terms of policy contract and the declaration contained in the form of proposal for assurance and personal statement, opposite party repudiated the claim and informed the complainant that they are not liable for any payment under the above policy and all moneys that have been paid in consequence there belongs to the company. It is further submitted by the complainant that her husband was in good health and he was not suffered from any disease at the time of proposal for insurance, that the deceased was not diagnosed as a case of calcific pancreatitis in 1996 as alleged by the company, that he was also not diabetic as alleged, that immediate cause of death was noted as Cardio Respiratory Arrest in the Medical certificate issued by the doctor who was attended the patient in the R.C.C, Thiruvananthapuram. The allegation raised against the deceased by the LIC are false, baseless, and without any evidence. Hence this complaint to direct opposite parties to settle the claim petition for Rs. 50,000/- with interest and pay compensation of Rs. 25,000/-.

Opposite parties entered appearance and filed version contending interalia that a policy of insurance was issued on the life of one Raveendran Nair for a sum of Rs. 50,000/- with risk commencing from 25.03.2004 in consideration of the proposal for insurance dated 06.03.2004 and the declaration thereon executed by the said Raveendran Nair, that the premium was arrived at Rs. 460/- payable every month by deduction of the said amount from the salary of the life assured as arranged by the insured from the date of risk till the date of maturity or till unfortunate earlier death of the life assured, that the life assured arranged payment of premium till 25.05.2005, that Smt. Geetha Kumari informed the 1^st opposite party about the death of the life assured on 11.07.2005 and claimed the money covered under the said policy, that she was requested to produce the relevant documents and particulars of treatment meted out to the life assured, that since death of the life assured had happened immediately after the issuance of the policy, an investigation in the matter was also conducted which revealed that the life assured was a diabetic patient for the past 8 years prior to his death and he was suffering from Tropical Pancreatitis in 1996, that complainant herself declared on 01.09.2005 in her statement that the life assured was suffering from Tropical Pancreatitis with B/L obstruction, that in her statement she had stated that the last medical attendant was Dr. Jayaprakash Madhavan and she had obtained and forwarded to LIC of India a Medical Attendant's certificate dated 11.07.2005 and a certificate of hospital treatment dated 07.09.2005, that in the said certificate Dr. Jayaprakash Madhavan had declared that the life assured was earlier treated by Dr. H. Ramesh of PVS Hospital, Cochi and the facts were revealed to him by the patient himself. From the discharge summary of PVS Memorial Hospital, it was revealed that the life assured was diagnosed as a patient of calcific pancreatitis in 1996, that the discharge summary dated 26.09.2004 of Department of Surgical Gastro Entrology of MCH, Thiruvananthapuram revealed that the life assured had the ailment Tropical Pancreatitis e B/L obstruction which was symptomatic for 4 years. The said revelations proved that at the time of submission of the proposal for insurance, the life assured was suffering from diabetes and Tropical Pancreatitis which was not disclosed by the life assured while submitting his proposal for insurance. The life assured had fraudulently suppressed material factors affecting the decision of the opposite party to issue a policy of insurance of his life as applied for by him. Hence opposite parties are not liable for any payment under the policy. There was no deficiency in service of any kind on the part of the opposite parties. Hence opposite party prayed for the dismissal of the complaint.

The points that arise for consideration are:-

1. Whether the insured was suffering from calcific pancreatitis before taking the insurance policy?

2. Whether the said disease was in his knowledge?

3. Whether the assured had deliberately suppressed the material information regarding his health at the time of effecting assurance?

4. Whether there is deficiency in service on the part of the opposite party in repudiation of the claim?

5. Whether the complainant is entitled to get claim amount?

In support of the complaint, complainant has filed proof affidavit as PW1 and has marked Exts. P1 & P2. In rebuttal opposite party has filed proof affidavit as DW1 and has marked Exts. D1 to D14 and Exts. X1 to X8 series. From the side of opposite party, three witnesses have been examined as DW2 to DW4.

Points (i) to (v):- Admittedly, the husband of the complainant, while he was in service, took a policy of insurance bearing No. 782510774 from the 1^st opposite party under the Kerala Government Salary deduction scheme, for a sum assured of Rs. 50,000/-. Ext. D2 is the copy of the policy. On perusal of Ext. D2, it is seen that the date of commencement of the risk is 25.03.2004 for 10 years under the plan 90-10 (marriage endowment/Educational Annuity plan with profits). It has been the case of the complainant that the life assured expired on 11.07.2005 and she filed a claim petition to 1^st opposite party for the money covered under the said policy and the said claim was repudiated by them. Complainant's evidence would consist of oral testimony of PW1 and Exts. D1 and D2. It has been rebutted by the opposite party that on investigation it was revealed that the life assured was a diabetic patient for the past 8 years prior to his death and he was suffering from calcific pancreatitis in 1996. It has been contended by the opposite party that as per Ext. P1 claimant's statement it is revealed that the life assured was suffering from Tropical Pancreatitis with B/L obstruction. It has also been contended by opposite parties that the said revelation/disclosure would prove that at the time of submission of the proposal for insurance on 06.03.2004 the life assured Ravindran Nair was suffering from diabetic and Tropical pancreatitis B/L obstruction/calcific pancreatitis and that he was treated at PVS Memorial hospital and those facts are very well known to him and he himself disclosed such facts to Dr. Jayaprakash Madhavan, but he had not disclosed the said illness while submitting his proposal for insurance. Opposite party's evidence would consist of oral testimony of DW1 to DW4 and Exts. D1 to D14 and Ext. X1 to X8 series. Ext. D1 is the copy of the proposal for insurance. As per Ext. D1 under personal history column for each question ranging from 11(a) to 11(l) the life assured had given the following answers:

(a) During the last five years did you consult a Medical

Practitioner for any ailment requiring treatment for

more than a week? : No

(b) Have you ever been admitted to any hospital or

nursing home for general check up, observation,

treatment or operation? : No

(c) Have you remained absent from place of work on

grounds of health during the last five years? : No

(d) Are you suffering from or have you ever suffered

from ailments pertaining to Liver, stomach, heart,

lungs, kidney, brain or nervous system? : No

(e) Are you suffering from or have you ever suffered

from Diabetes, Tuberculosis, High Blood Pressure,

Low Blood Pressure, Cancer, Epilepsy, Hernia,

Hydrocele, Leprosy or any other disease? : No

(f) Do you have any bodily defect of deformity? : No

(g) Did you ever have accident or injury? : No

(h) Do you use or have you ever used?

1. Alcoholic drinks : No

2. Narcotics : No

3. Any other drugs : No

4. Tobacco in any form : No

(i) What was been your usual state of health? : Good

(j) Have you ever required or at present availing/

undergoing medical advice, treatment or test

in connection with Hepatitis B or AIDS related

condition? : No

(k) Are you wearing glasses? If so, power of glasses : No

(l) (i) Missing teeth if any, if so, number missing : No

(ii) Are you wearing well fitting denture, if so,

for how many teeth? : No

Ext. D2 is the copy of the policy. Ext. D3 is the copy of the letter dated 11.08.2005 addressed to 1^st opposite party informing the death of the life assured. Ext. D4 is the copy of the claimant's statement. Ext. D5 is the copy of the certificate by employer. Ext. D6 is the copy of the discharge summary issued to Ravindran Nair by Medical College Hospital, Trivandrum. Ext. D7 is the copy of the claimant statement. Ext. D8 is the medical attendant's certificate issued by Dr. Jayaprakash Madhavan. Ext. D9 is the copy of the Discharge Summary issued by Digestive Disease Centre, PVS Memorial Hospital. As per Ext. D9, diagnosis is “Tropical calcific pancreatitis with carcinoma pancreas”. It is stated further in the discharge summary that “Mr. Ravindran Nair, a diabetic presented to hospital with history of abdominal pain. He was diagnosed as a case of calcific pancreatitis in 1996. He has been having severe pain since one year. He also complained of jaundice recently. He had lost about 5 kgs weight over last month. Physical examination revealed mild tenderness in the epigastrium. CT Scan of the abdomen available with the patient showed fore shortened pancreas and extrahepatic biliary dilatation. There was no clear cut mass seen. As per Ext. D9 the patient was admitted to PVS hospital on 09.10.2004 and was discharged on 20.10.2004. It is further stated in Ext. D9 that “In view of the increased severity of pain and jaundice he was operated on 11.10.2004. Laparotomy revealed a large mass involving the head and body of the pancreas. The mass infiltrated the superior mesenteric vein causing features of portal vein obstruction and portal hypertension such as dilated veins around the stomach and omentum. There was gross peripancreatic lymphadenopathy. CBD was 2 cms wide. The liver was normal. There was no ascites. In view of the advanced nature of the disease, a definitive procedure was abandoned. Biliodigestive bypass in the form of choledochojejunostomy(Roux-en-y) and gastrojejunostomy were performed. Post operative period was uneventful. He was discharged from the hospital on 20.10.2004. Ext. D10 is the copy of the repudiation letter issued by the opposite party. Ext. D11 is the copy of the letter sent by the complainant to 1^st opposite party intimating them the death of the life assured. Ext. D12 is the format of physician's report. Ext. D13 is the format of special blood sugar tolerance report. Ext. D14 is the underwriting guidelines for DMRs and Managers. DW1 has been cross examined by the complainant. DW2 has produced the case sheet as from RCC as Ext. X2. Medical Superintendent of PVS Hospital has been examined as DW3. Treatment records from Medical College Hospital has been marked as Ext. X1. Treatment record from PVS Hospital has been marked as Ext. X3. DW3 had deposed that Ext. D9 discharge summary was prepared on the basis of Ext. X3 treatment record. DW3 has further deposed that the details are recorded on the basis of the information details arrayed by the patient and the bystander. DW3 has deposed in chief examination that as per Ext. X3, it has been noted that he (Mr. Ravindran Nair) is a patient of chronic pancreatitis, started in 1996, it is also recorded that he is a diabetic patient since 1996, that based on their information and investigation further treatment is given. In his cross examination when asked whether any treatment records available prior to 09.10.2004 in Ext. X3, DW3 said as per Ext. X3 it is recorded on 13.09.2004 that he has done outside consultation with Dr. H. Ramesh, that Dr. Ramesh was working in PVS Hospital, that he is familiar with the handwriting of Dr. H. Ramesh. DW3 has deposed further that prescription by Dr. Ramesh is in a letter head dated 13.09.2004 which is prior to the admission in the hospital. DW3 has deposed that he has not treated the patient. On suggestion that 'without obtaining the brief history of treatment, if there is any prior treatment you will not commence the treatment', DW3 said “We investigate by our own, if available, we will go with the prior records also”. When asked 'if patient had undergone prior treatment definitely it will be recorded in your case sheet', DW3 said, generally it is not. Further, to a question that if a disease like calcific pancreatitis continuing for a long period, if there any prior treatment it will be recorded, DW3 has deposed that he cannot comment on this. It varies from patient to patient and from doctor to doctor. There is no standard procedure. DW3 has further deposed that from the records, he cannot say whether the patient has treated for the said disease mentioned during 1996-2004. In his re-examination DW3 said before admission, the patient/relatives have to record the details and in this case it has been recorded in black ink. Col. Suresh Babu has been examined as DW4. DW4 has produced the copies of the service details of Mr. Ravindran Nair. The copy of Service Book of Mr. Ravindran Nair during 2001-2005 has been marked as Ext. X4, the copy of the casual leave details as Ext. X5, the copy of the attendance register as Ext. X6 series, the copy of the medical reimbursement register as Ext. X7. DW4 has deposed that along with medical reimbursement application, the applicant has to furnish the essentiality certificate issued by the treating doctor and supported by bills. A perusal of the essentiality certificate [Ext. X8(a)] reveals that Mr. Ravindran Nair, UDC, Kerala Battalion NCC, Varkala has been under treatment at Medical College Hospital, Trivandrum for the period from 09.10.2003 to 25.02.2004 and the patient was suffering from chronic calcific pancreatitis and Diabetes mellitus and essentiality certificate was issued by Dr. K. Krishnadas. A perusal of Ext. X8 (b) to X(m) also reveal that the patient Mr. Ravindran Nair was suffering from chronic calcific pancreatitis, Diabetic Mellitus and Bronchial Asthma. DW4 has deposed that Mr. Ravindran nair was working as UDC in the 1^st Kerala Battalion NCC, Varkala during the period 2001-2005 and previously Mr. Ravindran Nair was working as Havildar Clerk in Madras Regiment and the said Service Book was not in the custody of the 1^st Kerala Battalion NCC office. On going through the documents furnished by the opposite party, it is convinced that the life assured was suffering from chronic calcific pancreatitis and diabetic mellitus before taking insurance policy and the said disease was in his knowledge at the time of moving the proposal on 06.03.2004 for insurance policy. The life assured had not disclosed the said illness he was suffering from while submitting the proposal for insurance dated 06.03.2004. Material factors were addressed to the proponent in the form of questions in the proposal form. It should be mentioned that the material factors are circumstances and facts regarding the state of health of the life proposed which would influence the judgement of a prudent underwriter insurance company in determining whether the insurer would take the risk or not and in fixing the premium. For each and every specific question in the said proposal regarding the state of health he had given wrong answers. Though he was fully aware of his such ailments he had fraudulently misrepresented the facts in the proposal for insurance. It is further to be noted that he had executed a declaration in the said proposal for insurance to the effect that the statements and answers had given by him after fully understanding the questions that the same were true and complete in every particular, that he had not withheld any information and that the proposal and the declaration in the proposal shall be the basis of the contract of insurance between him and LIC of India. He had further declared that if any untrue statements be contained in the proposal, the contract of insurance shall become absolutely null and void and all moneys which should have been paid in respect thereof shall stand forfeited to LIC of India. It is further to be noted that the contract of insurance is based on utmost good faith (uberrimae fidei). The duty of disclosure and uberrimae fidei are to prevent fraud in contract of insurance particularly contracts of life insurance. Since the person opting for insurance alone is in the knowledge of any illness he was suffering from and the insurance company gets knowledge of the same only if he discloses the same. Mutual trust and confidence are the basis upon which the parties to the contract of insurance proceeded. In view of the foregoing discussions we deem that the decision by opposite party to repudiate the claim had been arrived at after due application of mind and in utmost good faith and hence we do not find anything to attribute deficiency in service on the part of the opposite party in repudiating the claim of the complainant. Complaint has no merits at all which deserves to be dismissed.

In the result, complaint is dismissed.

A copy of this order as per the statutory requirements be forwarded to the parties free of charge and thereafter the file be consigned to the record room.

Dictated to the Confidential Assistant, transcribed by her, corrected by me and pronounced in the Open Forum, this the 16^th day of April 2011.

Sd/-

G. SIVAPRASAD : PRESIDENT

Sd/-

BEENAKUMARI. A : MEMBER

Sd/-

S.K. SREELA : MEMBER

C.C. No. 254/2006

APPENDIX

I COMPLAINANT'S WITNESS :

PW1 - Geetha Kumari. S

II COMPLAINANT'S DOCUMENTS :

P1 - Copy of the claimant's statement.

P2 - Copy of the registered letter dated 31.10.2005.

III OPPOSITE PARTY'S WITNESS :

DW1 - N. Chandrasekharan

DW2 - Chandrika. D

DW3 - Dr. B. Ramesh

DW4 - Col. Suresh Babu

IV OPPOSITE PARTY'S DOCUMENTS :

D1 - Copy of the proposal for insurance dated 06.03.2004

D2 - Copy of the policy of insurance

D3 - Copy of the letter dated 11.08.2005 addressed to 1^st opposite party.

D4 - Copy of the claimant's statement.

D5 - Copy of the certificate by employer.

D6 - Copy of the discharge summary issued to Ravindran Nair by Medical College Hospital, Tvpm.

D7 - Copy of the certificate of hospital treatment.

D8 - Copy of the medical attendant's certificate issued by Dr. Jayaprakash Madhavan.

D9 - Copy of the discharge summary issued by Digestive Disease Centre, PVS Memorial Hospital.

D10 - Copy of the repudiation letter issued by the opposite party.

D11 - Copy of the letter sent by the complainant to 1^st opposite party

D12 - Format of physician's report.

D13 - Format of special blood sugar tolerance report.

D14 - Underwriting guidelines for DMRs and Managers.

X1 - Treatment records from Medical College Hospital.

X2 - Case sheet as from RCC.

X3 - Treatment records from PVS Hospital.

X4 - Copy of the Service Book of Mr. Raveendran Nair during 2001-05.

X5 - Copy of the casual leave details.

X6 - Copy of the attendance register.

X7 - Copy of the Medical Reimbursement Register.

X8 - Medical reimbursement details

Sd/-

PRESIDENT

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