This case is coming for final hearing on 13-10-2014 in the presence of Sri V.H.M.Patro & V.V.Bhaskar Kumar, Advocates for the Complainant and Sri D.Siva Prasad, Advocate for 2^nd Opposite Party and 1^st Opposite Party called absent and having stood over till this date, the Forum delivered the following.                                                                                                                                             

: O R D E R :

(As per Smt. K.V.R.Maheswari, Honourable President(FAC) on behalf of the Bench)

1. The case of the complainant is that she is the wife of deceased Konatala Naga Jagga Rao who took policy with Profit Endowment Assures Plan (Future Assures) from 1^st Opposite Party at Visakhapatnam and 2^nd Opposite Party is the Claims Hub Office at Mumbai. The Policy No.00053538, which is valid from 25.01.2009 to 25.01.2023. The policy period is 15 years and the sum assured amount is Rs.7,00,000/-, wherein the Complainant is shown as nominee. The deceased Policy holder i.e. K.Naga Jagga Rao took another policy from 1^st Opposite Party on 4.3.2009 valid upto 4.3.2023. The Policy is Term Assurance Policy for a period of 15 years and the Policy No. is 00079692. The sum assured amount is Rs.5,47,000/-, there also the complainant is shown as a nominee. The Complainant stated that the deceased Policy Holder was hale and healthy while obtaining policy and he is doing small real estate business besides doing sand business and seasonal worker in Co-operative Sugar Factory, Tumpala village and he used to earn about Rs.2,00,000/- per annum. While so the Life assured suffered with fever and vomiting from 1.4.2009 and immediately he went to Government Hospital, Anakapalle for treatment as out-patient and again he visited Government Hospital, Anakapallion 23.04.2009 and also on 1.5.2009 as an outpatient and took treatment. Finally on 3.5.2009, the Life Assured died at his house due to fever, vomiting& motions. After funeral days, the Complainant approached 1^st Opposite party personally and informed about the death of the Life Assured and requested for settlement of two claims. Then the 1^st Opposite Party gave claim form and also advised the Complainant to inform about the death of her husband to 2^nd Opposite Party. Then the complainant informed to 2^nd Opposite Party about her husband’s death and she filled up the Claim Forms and gave it to 1^st Opposite Party with original policy bonds and Death Certificate. On 17.01.2012, 2^nd Opposite Party issued a letter to Complainant to send the documents, then the Complainant approached 1^st Opposite Party and informed about the letter issued by 2^nd Opposite Party, then the 1^st Opposite Party informed that such letter will come when the claim is under process, so need not send any reply as already concerned documents were submitted by the Complainant. The Complainant stated that on 31.08.2012, the 2^nd Opposite Party issued another letter to the Complainant and informed that both the Claims were in process. The Complainant also wrote a letter to the 1^st Opposite Party on 17.09.2012 requesting for early settlement of claims. Finally on 12.10.2012, the 2^nd Opposite Party issued a letter to Complainant repudiating the claim relating to Policy No.00053538 with false averments regarding the actual income of the deceased Life Assured. Then the Complainant sent her remarks on the said letter to Review Committee as per the advise of 2^nd Opposite Party only on 27.11.2012, with a request to reconsider the matter and to settle the claim amount. But both the Opposite Parties did not settle the claim amount, which clearly shows the deficiency of service on their part. The Complainant stated that regarding the another claim policy No.00079692 as the claim is filed before both the Opposite Parties and 2^nd Opposite Party on 31.08.2012 informed that the claim is under process but till today it was not settled. The acts of the Opposite Party causes lot of mental agony and financial hardship to the Complainant. Hence this complaint to direct the Opposite Parties

2. to pay the claim amount under 2 policies i.e. Rs.7,00,000/- + Rs.5,47,000/- along with 24% p.a. from the date of death of the deceased

3. to pay Rs.2,00,000/- towards compensation besides costs of Rs.10,000/-

4. On the other hand the 1^st Opposite Party called absent and set exparte, even after serving notices.

5. The 2^nd Opposite Party filed its counter and pleaded that there is no deficiency of service on the part of the Opposite Party and hence the complaint does not fall under the jurisidiction of this Forum. A Life Insurance Contracts are contracts “uberrimae fides” where observance of utmost good faith is enjoined on the parties to the contract i.e. they must disclose all material facts in respect of the risk to be covered by insurance. The Life Assured is obliged to give full and correct information on all matters. In Life Insurance Corporation of India & Ors Vs. Asha Goel (Smt.) & Anr. (2001) SCC 160, wherein it was held that the contracts of Insurance including the contract of life assurance are contracts uberrima fides and every material fact must be disclosed otherwise there is good ground for rescission of the contract. In another citation United India Insurance Co. Ltd. Vs. M.K.J.Corporation (1996 (6) SCC 428), the Apex Court observed that it is found principle of insurance law that utmost good faith must be observed by contracting parties. In P.C.Chacko and Anr. Vs. Chairman, Life Insurance Corporation of India and Ors., AIR 2008 SC 424 upheld repudiation of the contract of insurance on the ground of non-disclosure and misstatement in the proposal form. The Opposite Party relied upon decisions in Satwant Kaur Sandhu Vs. New India Assurance Co. Ltd., (2009) 8 SCC 316;TATA AIG Life Insurance Co. Ltd. Vs. Orissa State Cooperative Bank & Anr (2012) CPJ 310 (NC); New India Assurance Co. Ltd. Vs K.M.Babu Reddy; Smt.Devamma Vs. Life Insurance Corporaton in the R.P.No.4323/2012; Dineshbhai Chandrana Vs. LIC & Anr in FA No.242/2006.

6. The Opposite Parties stated that the Life Assured had vide proposal form bearing application No.A21164954 dt. 24.01.2009, proposed for the Future Assure Insurance Plan and in such proposal form, he answered questions pertaining to past medical history of any disease or illness and pertaining to the life assured’s occupation and annual income are false. The Life Assured was additionally informed of the provisions of Section 45 of the Insurance Act through proposal form. The Life Assured also gave a false information to the 2^nd Policy alsobearing Appln No.A21244530 dt. 3.3.2009 which was proposed for Future Care Insurance Plan. The Opposite Party relying upon the declaration submitted by the Life Assured in the Proposal form. The Opposite Party submitted that the Life Assured was suffering from Extra Pulmonary Tuberculosis and was availing treatment for the same under the revised National Tuberculosis Control programme in the year 2008 which is prior to the proposal in the year 2009 for both the policies in question. But the Life Assured answered wrongly in proposal form regarding medical history and treatment. The Life Assured stated that he owns a real estate business but his information is incorrect and he was not running his own real estate business but he actually working as a daily wage worker with Anakapalle V.V.Ramana Co-operative Sugars Limited till his death. Hence it clearly indicates that the Life Assured had deliberately, intentionally and willfully, misstated the true nature of his occupation and his true annual income and withheld information pertaining to his past medical history in order to wrongfully obtain the insurance policies in question and gain wrongfully at the expense of the Opposite Party company. After receiving death claim intimation from the complainant, the Opposite Party Company commenced an investigation into the genuineness of the claim preferred by the Complainant, since the Life Assured had passed away within a span of two years from the date of issuance of both the concern policies. The Investigation report revealed that the Life Assured was suffering from Extra Pulmonary Tuberculosis and availed treatment for the same and furtherrevealed that LA was not running his own real estate business and working as a daily wage worker. Hence, the Opposite Party repudiating the claim. Hence the repudiation of claim was legitimate and justified as such the complaint is to be dismissed with exemplary costs.

7. At the time of enquiry the Complainant filed Evidence Affidavit along with documents and Ex.A1 to A14 are marked. The Complainant also filed Written Arguments and on the other hand the 2^nd Opposite Party filed its Counter and Evidence Affidavit and Written Arguments and Exs.B1 to B4 are marked on behalf of Opposite Party. Heard both counsels who reiterated their respective contentions.

8. In view of the respective contentions, the point that would arise for determination is:-

   Whether the repudiation of the claim amount by the Opposite Parties is come under deficiency in service on their part, if so can the complainant claim the reliefs prayed for?

9. As per Ex.A1 & A2 and Ex.B1, the issuance of two policies by the Opposite Parties is not in dispute. Ex.A3 is the Death Certificate of the Life Assured, Ex.A4 is the letter issued by the Complainant to the Opposite party on 7.2.2011 regarding the request of issuance of Claim Form and Ex.A5 is the letter dt. 2.12.2011 by the Complainant, by sending relevant documents of those two policy bonds and Claim Forms. Ex.A6 dt. 11.2.2012 letter by the Complainant to Opposite Party Claims Department mentioned that enclosing claim form and other necessary documents. Ex.A7, Ex.A8 are the letters issued by the Opposite Party to the Company regarding the submission of documents dt.17.01.2012 & 31.08.2012 respectively. Ex.A9 is the letter issued by the Complainant dt. 17.09.2012. Ex.A10 is the repudiation letter issued by the Opposite Party to the Complainant on 12.10.2012 and by repudiating claim by mentioning that the insured was suffering with Extra Pulmonary Tuberculosis and was under treatment for the same even prior to the date of application. Hence, the Opposite Parties are unable to honour the complainant’s claim and they are repudiating the claim under the policy. Wherein Ex.A10 they mentioned the Policy No. as 00053538. Ex.A11 is the letter issued by the Complainant to Opposite Parties Claim review Committee regarding request to settle the policy. Ex.A12 is the request for death claim. Ex.A13 is the bunch of courier receipt evidencing the letters issued by the Complainant to both the Opposite Parties and Claims Department. Ex.A14 is the letter issued by the office of the Medical Superintendent, Area Hospital, Anakapalle by answering under the Right to Information Act and stating that on verification of their Hospital OP Register, the patient by name K.Naga Jagga Rao, Male, aged 42 years was registered on date 01.05.209 with OP No.29005. The 3^rd page of Ex.A14 shows the copy of OP Chit of A.P.Vaidya Vidhan Parishad on various dates those are 23.04.2009, 01.04.2009 & 01.05.2009.

10. The version of the Complainant is that even after intimation of the death of her husband made by the Complainant, the Opposite Parties are not come forward to settle the issue. The Complainant made several requests and sent all required documents along with claim form and after 3 years the Opposite Party issued a letter and repudiated the claim by stating that the insured was suffered from Extra Pulmonary Tuberculosis. But as per her version, her husband was hale and healthy at the time of taking the policy.

11. The main plea of the Opposite party is that the DLA was gave wrong statement in his proposal form i.e., Ex.B1 regarding his income and medical condition and it is the bounded duty of the DLA that he has to give true statement under Sec.45 of Insurance Act 1938, but he failed to do so.Ex.B2 is the repudiation letter dt. 12.10.2012. Ex.B3 is the Investigation report dt.27.08.2012 filed by the Opposite Party. Wherein the Investigator mentioned in page No.2 that “during our enquiries with the relatives we were informed that Life Assured used to work as a Daily wage worker in the Sugar Factory, Tummapala, Anakapalle. He suffered with HIV and died due to the same. Though the claimant admitted that her husband was infected with HIV and treated in NTR Hospital, Anakapalle she submitted the written statement that her husband did not have any health issues during his life time but he died due to diarrhea and fever. The neighbours and villagers informed us that LA suffered with HIV due to which he became weak and lean. He did not have proper food. Some of the villagers informed us that he was treated at Seven Hills Hospital but not aware of any details. We were informed that Life Assured was treated at NTR Hospital, Anakapalle for HIV but no information was found”. In the investigation report the Investigator verified hospitals at Anakapalle ART centre, NTR Area Hospital, Anakapalle, Seven Hills Hospital, Vizag, King George Hospital, Vizag but he did not filed any relevant information from any of the Hospital or Clinics. But the investigator mentioned that during his reinvestigation he found that DLA’s wife i.e. Complainant wife also infected with HIV and treated at Anakapalle, but the details were not known to the investigator. In Investigator’s report only he investigated the Employer also who informed and gave authorization letter stating that he is the Daily wage worker in their factory until his death i.e. Ex.B4. In conclusion the investigator stated that on a foregoing his findings and observation and in the absence of any medical evidence, he recommend the Insurance company to take appropriate decision.

12. We are of the view that it is true that as per Sec.45 of the Insurance Act the Life Assured has to give correct information but the Opposite Parties cannot substantiate its plea regarding the incorrect information given by the Life Assured at the time of taking policy i.e. in Proposal Form regarding the treatment for his pre-existing disease. Moreover, in the repudiation letter i.e. Ex.B2 & A10 they mentioned that Life Assured was suffering from Extra Pulmonary Tuberculosis and he was under treatment for the same even prior to his date of application. It is to be particularly noted that in Ex.B3 i.e. Investigator’s report, the Investigator very consciously investigated and came to a conclusion that the Life assured was treated for his HIV. But he failed to file any document or medical record or even any piece of prescription to show that the life Assured was under treatment for HIV at the time of his death. It is also noted that investigator himself investigated and came to conclusion that the Life Assured’s wife i.e., complainant was also admitted in Private Nursing Home and she is also suffering with HIV infection. But here also opposite party cannot substantiate its plea by filing any evidence. Thus the Opposite Party itself is in confusion that, was the Life Assured died with Tuberculosis or HIV? If we assume a while that Life Assured died with Tuberculosis, this disease needs a prolonged treatment like HIV. But the investigator cannot capture the evidence regarding the treatment or medical report either from any hospital, clinic or from any medical shop. But simply Opposite party argued that there is no deficiency of service on their part and the complaint cannot come under Consumer Protection Act, but not evidencing their pleas.

13. Since the allegation made by the Insurance Company regarding the treatment for major ailments like HIV, Tuberculosis the burden of proof was upon Insurance Company only. But Insurance company miserably failed to adduce sufficient evidence in support of its allegations.

14. The Consumer Protection Act is a beneficiary legislation and it cannot allow the Insurance company to escape from the liability to deprive the consumer benefits for which she was entitled. It will be unfortunate, if the Insurance Company tried to repudiate the genuineness of death claims on such technical and flimsy grounds. Most of the insurer will be victims and beneficiaries will be deprived of fruit of Life Insurance benefits. Hence in our view, the repudiation by the Opposite Party that too only for Policy No.00053538 and for another policy No.00079692, there is neither repudiation nor settle the claim. But in their counter the Opposite Party mentioned that they issued repudiation letter to Policy No.00079692 on 12.10.2012. But no copy of repudiation letter regarding that policy is filed by Opposite Party. Hence till today the Policy No.00079692 position is not known to the Complainant, which clearly shows its deficiency and negligent attitude in their services.

15. After careful analysation of the facts of the complaint, counter with related documents the Forum is of the view that the repudiation of claim amount for two policies by the Opposite Party is not justified and hence the Opposite Parties have to pay the Policy amount of Rs.7,00,000/- against Policy No.00053538 and Rs.5,47,000/- against Policy No.00079692 with 9% interest from the date of repudiation i.e. 12.10.2012.

16. It is true that the Complainant suffered financially and mentally because of the acts of the Opposite Party by repudiating the claim amount of one policy and by not knowing the position of the 2^nd Policy. Hence she can entitled for the compensation of Rs.5,000/- which would be just and proper.

17. Accordingly, this point is answered.

    9.       In the result, the complaint is allowed directing both the Opposite parties to pay Policy amount of Rs.7,00,000/- and Rs.5,47,000/- in total Rs.12,47,000/- against Policy Nos.00053538 & 00079692 respectively with 9% p.a. interest from 12.10.2012 to the Complainant within three months, failing which to pay the same with 12% p.a. till the date of payment. The Opposite Parties are further directed to pay Rs.5,000/- towards Compensation besides costs of Rs.2,000/-.

    Dictated to the Shorthand Writer, transcribed by him, corrected and pronounced by us in the open Forum on this the 28^th day of October, 2014.

     

           Sd/-                                                                             Sd/-

    Member                                                                President (FAC)

                                                                       District Consumer Forum-I

                                                                                 Visakhapatnam

APPENDIX OF EVIDENCE

Exhibits Marked for the Complainant:

Exhibits Marked for the Opposite Parties:    

       Sd/-                                                                             Sd/-

  Member                                                                President (FAC)

                                                                   District Consumer Forum-I

                                                                              Visakhapatnam

// GLR //