Haryana

StateCommission

CC/86/2019

DALBIR KAUR - Complainant(s)

Versus

HDFC ERGO GENERAL INSURANCE COMPANY LTD. - Opp.Party(s)

ROHIT KAUSHIK

28 Feb 2023

ORDER

 

STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

HARYANA PANCHKULA

                  

                                                Consumer Complaint  No.86  of  2019

Date of the Institution:20.03.2019

Date of Final Hearing:    28.02.2023

Date of pronouncement :07.03.2023

 

Dalbir Kaur W/o Sh.Gurnam Singh R/o Ward No.8, By-pass road Nissing,  Distt. Karnal 132024.

                                                                   .….Complainant

Versus

1. HDFC ERGO General Insurance Company Limited, Registered and Corporate office: 1^st Floor, HDFC House, 165-166 Backbay Reclamation, H.T. Parekh Marg, Churchgate, Mumbai 40020 through its authorized signatory.
2. Housing  Development Finance Corporation Limited (HDFC), Company through its Divisional/Branch Manager Karnal, SCO No.247-248, First Floor, Sector 12, Opp. Mini Secretariat, Karnal.

                                                          .….Opposite Parties

 

CORAM:   S.P.Sood, Judicial Member

                   Suresh Chander Kaushik, Member

 

Present:-    Mr.I.S.Khasa, Advocate for the complainant.

Mr.Vishal Aggarwal, Advocate for the Opposite Party No.1.

Ms. Apurva proxy counsel for Ms. Rupali Shekhar Verma, Advocate for the opposite party No.2.

 

O R D E R

S P SOOD, JUDICIAL MEMBER:

 

The brief facts giving rise for the disposal of the present complaint  are that  Simarpal Singh son of the complainant  had raised a home loan from the opposite party No.2 vide loan account NO.622000074 for a period of 240 months (20 years) repayable through equated monthly installments of Rs.23,222/- each alongwith agreed rate of interest of 9.45% p.a. The OP No.2 had sanctioned the loan of Rs.25/- lacs in the name of son of the said complainant.   OP No.2 was having tie up with OP No.1 and OP No.2 at the time of advancing the loan, had disclosed that for securing the loan amount, it was compulsory for the borrower/Simranpal to obtain this insurance under the name and style of Home Suraksha from OP No.1 and accordingly, the OP No.1 provided insurance policy bearing No.2918 2015 1251 7400 001 in the name of  Simar Pal Singh w.e.f. 30.09.2016 to 29.09.2021 having premium amount of Rs.64,477/- and that amount was also added to the amount of installments to be paid by the Simar Pal Singh to the OP No.2 and as such the complainant being nominee of her son was consumer of the OPs. The complainant was appointed as nominee of the insured i.e. Simar Pal Singh and the said policy was having sum assured of Rs.25,54,450/- and he has been regularly making payment of installments and OP No.1 also received deduction of Rs.37,119/- under section 80 D of Income Tax Act, 1961. Vide this insurance policy issued by OP No.1, it was agreed that if due to any of the illness/natural death/personal accident Simar Pal Singh expires, then in that case OP No.1 would be bound to clear the outstanding loan and pay remaining installments and the complainant shall not be liable to deposit the installments further. Mr.Simarpal Singh was  serving in SERENE India Software Services Pvt. Ltd. at Pune.  Some how or the other Simarpal got down with virus in the month of October, 2018 and was got admitted in Sanjiv Bansal Cygnus Hospital, Karnal on 11.10.2018 but as his condition was deteriorating and considering his serious condition, the doctor of said hospital decided to refer him to some higher medical centre. He was shifted to Max Super Speciality Hospital, Mohali on 13.10.2018 but his situation did not improve and as the  ill-luck would have it he could not survive the impact of dengue shock and thus expired on 16.10.2018 in the said hospital. OPs were informed in this regard. The complainant also submitted all the necessary documents with the OPs, but OPs wrongly repudiated her claim vide letter dated 05.12.2018 stating therein that Sh.Simar Pal Singh died due to acute dengue fever which was not covered under the policy. The OPs  were intentionally and deliberately avoiding their liability and have not acceded to the request of complainant and repudiated the claim, which amounts to unfair trade practice and deficiency of service on part of the OPs. The total EMIs paid by original borrower for the house loan were 26 in number which amount to =Rs.6,03,743/- (26 x 23222/-). The remaining amount to be paid to discharge the loan was equivalent to Rs.25,00,000/- - Rs.6,03,743/-=Rs.18,96,257/-. The EMIs from November, 2018 to March, 2019 could not be paid due to the death of Simar Pal Singh and remarks on the said cheques of “insufficient funds” which amount to Rs.1,16,110/-. The total amount payable by OP No.1 to OP No.2 as per policy and agreement was equivalent to Rs.18,96,257/- + 1,16,110/-= Rs.20,12,367/-. Thus there being deficiency in service as well as unfair trade practice on the part of the OPs, hence, this complaint

2.      Notice being issued, both opposite parties filed separate written statements.  OP No.1 submitted that policy namely Home Suraksha plus was issued to the insured which was duly accepted by him and no complaint whatsoever was made from the date of issuance till the death which was more than 2 years.  There was no coverage under the policy except for the terms and conditions mentioned under the policy.  The answering OP was liable to pay the remaining installments only if the insured was diagnosed of any disease as mentioned in the policy or he would have died due to the reasons as mentioned in the policy. The insured died due to dengue which was not covered under the policy and therefore, the claim  has rightly been  repudiated. Thus there being no deficiency in service as well as unfair trade practice on part of the OPs, the complaint deserves dismissal against it.

3.      OP No.2 averred that the answering OP does not have any privity of the contract of insurance with complainant.  It is not correct that OP No.2 has no control over the affairs and functioning of OP No.1. The complainant alongwith Mr.Simarpal Singh availed of two loans one for Rs.25,00,000/- and another of Rs.64,450/- at variable rate of interests. The son of complainant out of his own free will and volition purchased insurance policy from OP No.1. OP NO.2 has only granted loan facility to him. The loan accounts of the son of complainant became irregular and till date an amount of Rs.25,99,239/- and Rs.71,062/- were outstanding towards the loans advanced by the answering OP. Thus there being was no deficiency in service on the part of the OP No.2 and have dismissal of the complaint as prayed for.

4.      When the complaint was posted for recording evidence of the parties, Mr.Jashan Singh counsel for the complainant has tendered in evidence affidavit Ex.CA of Smt. Dalbir Kaur vide which she reiterated all the averments taken in the complaint and further tendered the documents Ex.C-1 to Ex.C-8 and closed his evidence.

5.      On the other hand, in order to rebut the evidence led on behalf of the complainant, O.P No.1 has also tendered the affidavit of Ms.Shweta Pokhriyal HDFC ERGO General Insurance company Ltd. as Ex.OP-A/1 and  closed its evidence.

6.      Learned counsel for the O.P No.2 has also tendered in evidence affidavit of Shri Aditya Kochar, Assistant Manager and authorized representative of Housing Development Finance Corporation Ltd. as Ex. OPW1/A and   further tendered the documents Ex.OP2/1 colly to Ex.OP2/2 colly) and closed its evidence.

7.      The arguments have been advanced by Mr.I.S.Khasa, Advocate for the complainant as well as  Mr.Vishal Aggarwal, Advocate for the Opposite Party No.1 and Ms.Apurva proxy counsel for Ms. Rupali Shekhar Verma, Advocate for the opposite party No.2. With their kind assistance entire record including documentary evidence as well as whatever other material has been brought on record during the proceedings of the complaint has been properly perused and examined.

8.      The question involved in this case is whether the insurance company is liable to pay the outstanding loan amount to the bank?

9.      It is not disputed that the home loan was obtained by the son of  complainant i.e. co borrower.  It is also not disputed that OP NO.2 deals in home loan sector, whereas the OP No.1 deals in the business of insurance of property. It is also not disputed that son of complainant paid the premium and the property was insured with OP No.1. It is also not disputed that during the subsistence of the policy, Simarpal Singh passed away. The plea of the insurance company is that since Simarpal Singh had died  due to dengue shock so it was not liable to pay the compensation as per terms of the policy under which only the critical illness cases were covered. As per the terms and conditions of the policy some of the diseases which were included, are as under:

a) First diagnosis of below mentioned illnesses more specifically described below:

1.      cancer

2.      kidney failure (End Stage Renal Failure);

3.      Multiple Sclerosis; or

b)      Undergoing for the first time of the following surgical procedures, more specifically described below:

1.      Major Organ Transplant;

2.      Heart Valve Replacement;

3.      Coronary Artery Bypass Graft;

c) occurrence for the first time of the following medical events more specifically described below:-

1.      Stroke;

2.      Paralysis;

3.      Myocardial infarction;

As per the death summary of Simarpal Singh, the view of the doctors as under:-

“In view of progressive multiorgan failure, patient had persistent clinical worsening and the patient had cardiac arrest @ 12.55 pm on 16.10.2018. CRP was started according to ACLs protocol and continued for >30 min. there was no return of spontaneous circulation.

Since the patient had cardiac arrest at12.55 p.m. on 16.10.2018 and myocardial infarction is very much covered under the policy.  The sole plea of OP for repudiating the claim is that since dengue is not covered under the diseases which all were covered under the policy in question that is why it was not liable to pay the claim but this view is clearly fallacious. A bare perusal of the death summary of Sh.Simar Pal categorically brings out that he suffered multi-organ failure followed by cardiac arrest which proved to be fatal. So even if in the beginning it was only for dengue infection for which he was hospitalized still slowly and slowly his condition worsened to an extent of him suffering multi organ failure leading to cardiac arrest. So in this way when the immediate cause of his death was cardiac arrest which is squarely covered under the policy itself so it was not justified on the part of the insurance people to refuse to pay up the claim as agreed. The OP No.1 has wrongly repudiated the claim of the complainant vide letter dated 05.12.2018. Since, the death of the patient was cardiac arrest as per the death summary, why insurance company is not paying the compensation as per the terms and conditions of the insurance policy that is not understandable.    It is the responsibility of the opposite party No.1 to pay the balance dues of home loan amount to the OP NO.2 as Mr.Simar Pal Singh has died during the subsistence of the policy and as per the terms and conditions of the policy, the complainant being his nominee was entitled for the claim amount.

                   There is another aspect  involved in this case which also needs to be addressed. The loan was raised jointly by mother and son  duo which in common parlance conveys that the same was supposed to be repaid by them jointly and their liability was co-extensive. However now the question arises since when these borrowers are co-borrowers and one of them Mr.Simar Pal Singh has passed away, therefore, in such a situation whether other borrower i.e. mother of the deceased  can be made liable to pay the outstanding amount singly and how the banker will proceed against her in this scenario.  As per law the liability of the insurance company shall be limited to the amount insured towards  house loan and would not be restricted towards proportionate liability of her son in the home loan raised jointly by mother and son duo.   In other words the outstanding loan limited to the  sum insured by the Insurance Company shall be released towards the claim preferred by the claimant.  The case laws relied by the counsel for the complainant titled Trans Mediterranean Airways Vs.Universal Exports 2011 (4) KLT SN 92 (C.No.75)SC, Manmohan Nanda Vs. United India Assurance co. Ltd. (SC) 2022(1) Apex Court Judgments (SC) 685, Sushilaben Indravadan Gandhi Vs New India Assurance company Limited (SC) 2021(7) SCC 151  are applicable in the case in hand because the facts and circumstances of the cases are similar that of the present case.  The question is answered in the affirmative.

10.              Hence, in view of the above, the complaint is allowed and the OPs are directed to release the claim of the policy No.2918201512517400001 in favour of the complainant being nominee/mother of policy holder Sh.Simar Pal Singh.  The OPs are also directed to pay interest @ 9%  per annum on the sum assured/claim  amount from  the date of death of Sh.Simar Pal Singh till its actual realization.   In case, there will be a breach in making payment within the stipulated period  of  45 days, in that eventuality, the complainant would further be entitled to get the interest @ 12% per annum, for the defaulting period.   The complainant is also entitled to Rs.50,000/- (Fifty Thousand Only) for compensation on account of mental and physical agony.  In addition, the complainant is also entitled to Rs.25000/-  (Twenty Five Thousand Only) as litigation charges.  It is also made clear that for non-compliance, the provisions enshrined under section 72 of the C.P.Act  would be attractable. 

11.    Applications pending, if any stand disposed of in terms of the aforesaid order.

12.    A copy of this order be provided to all the parties free of cost as mandated by the Consumer Protection Act, 1986/2019. The order be uploaded forthwith on the website of the commission for the perusal of the parties.

13.    File be consigned to record room.

 

March 7th, 2023     Suresh Chander Kaushik,          S.P.Sood

                             Member                                    Judicial Member                                 

S.K.(Pvt.Secy)