F.A.No.87/  against  C.C.No.31/2012, District     

Between:

1.The Branch Manager,

   Life Insurance Corporation of India,

      S/  Age :58 years,

   South Central

2.  Life Insurance Corporation of India,

     Rep. by its Divisional Manager, Near

     RTC Complex, Visakhapatnam, through its

     S/  Age : 58 years,

     (L & HPF South Central

           Hyderabad.                                     ...Appellants/

           And

Guna

Age

Dharma

Naupada R.S.,

Tekkali                          ... Respondent/

                                                                               Complainant 

Counsel for the Appellants    :              M/s.

Counsel for the   :               M/

QUORUM:   SRI R.LAKSHMI NARASIMHA RAO

                                         AND

                    SRI   RAO, HON’BLE MEMBER.

        THURSDAY, THE TWELFTH DAY OF SEPTEMBER,      

Oral Order: (  Sri            

                                    ***

                This appeal  directed against the order dt.06.07.2012  of the District Forum,   in C.C.No.31/2012.

        For the sake of convenience, the parties as arrayed in the complaint.

          together with interest at 24% p.a. from the date of death of the insured   for causing mental agony  and hardship and Rs.5000/-  towards costs of the litigation. 

        The brief case of the complainant as set out in the complaint is that his sister by name   for a sum of Rs.1 lakh by showing the complainant as nominee.  On 29.1.2011, the insured died while getting treatment   at Community Health Centre,  Immediately, the complainant intimated the  death of his sister to the opposite party no.1 and as per the requirements of the opposite party no.1, the complainant  submitted all the relevant documents to opposite party no.1, but the opposite party no.1 has not settled the claim of the complainant till the date of filing of the complaint. Thus,   both the opposite parties committed gross negligence and there is deficiency in service on the part of the opposite parties.  the complaint. 

        Opposite party no.1 resisted the complaint by filing the written version denying the material allegations made in the complaint  and contended that the deceased life assured is unmarried,  mentally disabled lady  and was receiving  physically handed capped allowance  of Rs.500/- per month. The deceased life assured had wilfully not disclosed the   the opposite party corporation issued policy for assured sum of Rs.1 lakh. Further, the occupation of the deceased was mentioned as agricultural labour  with yearly income of Rs.60,000/- under question no.5 in the proposal form dt.15.12.2009 and  basing on the  said false answers given by the  deceased policy holder, the opposite parties corporation  issued policy with utmost good faith.  That the deceased life assured was not maintaining sound mind at the time of proposal and is not eligible for insurance coverage.  The complaint is bad for   pre mature, as the opposite parties are processing the claim and verifying the  .         

         During the course of enquiry, before   District Forum, in order to prove his case, the complainant filed his evidence affidavit and got marked Exs.A1 to A5. On behalf of the opposite parties corporation, its administrative officer, L & HPF Department   filed his evidence affidavit and got marked Exs.B1 to B7.

        Upon hearing the counsel for both the parties and on consideration of the material on record, the District Forum while dismissing   complaint,   directed the opposite parties to pay the insured amount to the parents of the deceased with benefits. 

         Aggrieved by the said order, the appellants/opposite parties preferred   above appeal  urging that the order of the District Forum is contrary to law, opposed to evidence on record and probabilities  of the case.    that the deceased life assured suffering from mental disorder and drawing  the pension of Rs.500/-, from the Government and that the District Forum ought to have seen that since the deceased insured knowingly and wilfully suppressed  her health condition at the time of taking the policy,  the policy itself is void  and the appellant corporation has legally repudiated the claim.  The appellants/ C.C.No.31/2012.

         We heard the counsel for both   parties and perused the entire material placed on record.

        Now the point for consideration is whether the impugned order of the District Forum is vitiated for          appellant corporation  is that since the claim is  an early claim, the appellant corporation conducted   enquiry and came to know that the deceased life assured was suffering from  mental disorders and drawing pension from the Government by the time of taking  the policy and obtained policy by suppressing the same and hence the appellant corporation repudiated the claim.  appellant corporation further contended that it is well settled principle of law that the contract of insurance is based on the principle of   since the    deceased  insured  knowingly and wilfully suppressed her health condition, at the time of taking the policy, the policy itself is void and this appellant corporation has legally repudiated the claim of the complainant. Therefore, the impugned order of the District Forum is not sustainable under law and is liable to be set aside and the complaint is  to be dismissed. 

        It is an admitted fact that    the deceased herein insured her life  with appellants corporation on 15.12.2009  for a sum of Rs.1 lakh by showing the complainant as her nominee and that the  life assured died on 29.01.2011.

        According to the complainant, the insured died due to high fever, while getting treatment at the Community   Centre,

         from mental disorders  and drawing pension from the Government by the time of taking the policy  and obtained the policy by suppressing the same and as such, the policy itself is void and the appellant corporation is legally justified in repudiating the claim of the complainant. In order to prove the same, the appellant corporation filed  

         DRDA,   along with copy of the physically handicapped certificate   produced by The Project Director, DRDA,  pensioner, the nature of disability  is  O.H.50%  and the pension amount paid is Rs.500/- per month. Under Ex.B6 letter, the Project Director,  directed  the M.P.D.O.,  copy of the physically handicapped  certificate of the said pensioner, directly  to opposite party no.2.    Ex.B7 letter dt.02.02.2012, the Manager of  opposite party no.2 requested the   sanction of pension along with copy of the physically handicapped certificate relating to   From these documents, it appear that the deceased life assured   was physically disabled  and was drawing Rs.500/-  pension per month, from the Government. These documents do not  show that the deceased life assured was suffering from the mental disorders and for that   she took pension from the Government.  As seen from Ex.B4, the copy of the Election Card, the Government recognised   life assured as a voter  and issued original of Ex.B4 voter identity card.  As seen from   Form, no column is provided in the   of the applicant. Therefore, the deceased life assured fault with, for not furnishing the information in Ex.B2     even if she failed to disclose her physical disablement it does not amount to suppression of her disablement, because the physical disablement cannot be kept secret as the same  is clear to  naked eye of one and all. Admittedly, the agent  the appellant corporation collected the information, from  the deceased life assured and filled Ex.B2 form. Therefore, the agent of   appellant  corporation  must have noticed the physical disablement of the deceased  life assured at the time of filling of Ex.B2 form. The appellant corporation did not adduce any evidence   show that the deceased life assured was suffering from  mental disorders prior to and after  obtaining the  subject policy by her, from the appellant corporation. 

        In view of the  facts and circumstances, we are of the considered view that the appellant corporation failed to establish that the deceased life assured was suffering from mental disorders by the date of Ex.B1 policy and thereafter  till her death and that the deceased life assured suppressed  his mental disorder and obtained Ex.B1   policy from the appellant corporation. Therefore, the appellant corporation is not justified in rejecting the claim of the complainant.   The complainant submitted his claim to the appellant corporation, along with required documents and     these circumstances, the opposite parties cannot be heard to say that the complaint filed by the complainant  is pre mature.

        Having  regard to the  above facts and circumstances,   it is established that there is negligence  and deficiency in service on the part of the  appellant corporation in  not settling the claim   and rejecting the same   without valid grounds. Therefore, we do not find any grounds, much   valid grounds, to set aside  the impugned  order of the   District Forum.

        Admittedly, the complainant is a nominee of the deceased life assured  as per Ex.B1 policy. Therefore, he is entitled to receive the assured sum from the insurance company and then  pay to the legal heirs of the deceased. Therefore, the District  Forum ought to have directed  the opposite parties  to pay the  assured  sum to the complainant  directing the complainant  to pay  the assured  sum received  from the appellant corporation  to the legal heirs of the deceased life  assured i.e.  parents of the deceased. 

         In the result,   the complaint in C.C.No.31/2012 is allowed,  directing the opposite parties, to pay the assured sum to the    complainant  and the complainant  is directed to  pay the sum received  by him from the insurance company, to the legal heirs of the deceased life assured  i.e. the parents of the deceased.    Subject to the above modification of   impugned order, the appeal  is dismissed, but in the circumstances of the case  without costs.

                                                                        MEMBER  

                                                                         MEMBER

Pm*                                                                    Dt. 12.9.2013