1.     This First Appeal filed under Section 19 of the Consumer Protection Act, 1986 (in short, ‘the Act’) challenges the order dated 19.01.2018 of the State Consumer Dispute Redressal Commission, Punjab (in short, the ‘State Commission’) in complaint no.372 of 2017 praying to set aside the impugned order and direct the respondents to release Rs.25,00,000/- against the claim on account of death of the appellant’s son with interest @ 18% per annum from the date of death till realization and Rs.2,00,000/- as litigation expenses apart from any other order as deemed fit.

2.     The brief conspectus of facts in the matter are that the deceased son of the appellant, Manjit Singh, had obtained a Life Insurance Policy from the respondents on 24.11.2014 vide Policy No.17185259 for a sum of Rs.25,00,000/-. The insured, however, expired on 21.02.2015 of natural causes and the complainant being the nominee of the deceased lodged an insurance claim for Rs.25,00,000/- with the respondent. The respondent repudiated the claim vide letter dated 15.07.2015 on the ground that the Deceased Life Assured (DLA) had concealed the information of holding another, previous insurance policy issued to him prior to the policy in question. An appeal before the State Commission filed by the appellant in CC No.372 of 2017 was dismissed on 19.01.2018 upholding the contention of the opposite party/respondent that there had been suppression of material facts at the time of obtaining the policy.

3.     This appeal is based on the contention that there was no suppression of any previous policy and that in case of Life Insurance Policy non-disclosure of any previous policy is not a material fact.

4.     Reliance was placed on the judgments of this Commission in Aviva Life Insurance Vs. Rekhaben Ramjibhai Parmar in RP No.4204 of 2011 which had relied upon the order of the Hon’ble Supreme Court in CEO/Sahara India Life Insurance Company Ltd. and another vs. Rayani Ramayanjneyaulu dated 21.11.2014 which upheld that information regarding previous insurance policy could not be held to be material.

5.     It was also contended that the DLA was not educated or conversant in English and did not understand the contents of the Proposal Form and that the terms and conditions of the policy had not been disclosed to him. The contents were also not explained to the deceased in vernacular i.e. Punjabi language. The evidence of the Legal Manager of the respondent was erroneously accepted by the State Commission, since he packed personal knowledge of the case or was a party or privy to the documents pertaining to the insurance policy in question. The order of the State Commission was stated to be based on conjecture and surmise and was based upon an erroneous conclusion that the deceased had violated the principle of uberrima fides (utmost good faith).

6.     We have heard learned counsels for both the parties and perused the material available on record including short synopsis of arguments filed by the learned counsels.

7.     The moot issue in this case pertains to whether the DLA had violated the principle of uberrima fides in not disclosing the existence of a prior insurance policy obtained by him, that was discovered by the respondent during the course of its investigation into the claim which was mandatory in view of the fact that the claim was being made within a period of two years of obtaining the policy. The appellant has not denied the fact that there was another policy obtained by the DLA. It is the contention of the appellant that the non-disclosure of this fact was not material as held by the Hon’ble Supreme Court in Reliance Life Insurance Co. Ltd. & Anr. Vs. Rekhaben Nareshbhai Rathod in Civil Appeal No.4261 of 2019, which judgment is stated to pertain to a similar case of claim under the Life Insurance cover policy. It is argued that in this case it had been held that the policy had been obtained based upon a reply in the negative to a similar question and it had been held by the Hon’ble Apex Court that although the contract of the insurance falls in the category of uberrima fide as held by the Hon’ble Supreme Court in its earlier judgments in United India Insurance Co. Ltd. Vs. M.K.J. Corporation 1997 (1) RCR (Civil)-32 and Modern Insulators Ltd. vs. Oriental Insurance Co. Ltd. (2000) 2 SCC-734, that ‘material fact’ constitutes:

“any fact which would influence the judgment of a prudent insurer in fixing the premium or determining whether he would like to accept the risk. Any fact which goes to the root of the contract of insurance and has a bearing on the risk involved would be material”.

8.     The Hon’ble Supreme Court had also held that the contention of the respondent that the signature of the assured was obtained on the form without explaining the details cannot be accepted since a person who affixes his signature to a proposal which contains a statement which is not true cannot escape from the consequences arising from it. It was also contended that the Hon’ble Supreme Court had held that in filing up the proposal form, the agent ceases to act as an agent of the insurer but becomes the agent of the insured and no agent can be assumed to have authority from the insurer to write the answers in the proposal form.

9.     The State Commission has relied upon the judgments of the Hon’ble Apex Court in United India Insurance Co. Ltd. vs. M.K.J Corporation 1997 (1) RCR (Civil)-32 regarding utmost good faith, and Modern Insulators Limited Vs. Oriental Insurance Co. Ltd., (2000) 2 SCC-734 with regard to material fact to be understood in general terms as any fact that would influence the judgment of a prudent insurer. It has also relied upon Satwant Kaur Sandhu Vs. New India Assurance Co. Ltd., (2009) 4 CPJ-8 that:-

          “…….life assured has violated the principle of uberrima fides in this case by not disclosing the status of previous policies in the proposal for to OPs. It is fundamental violation of contract of insurance justifying the OPs to repudiate the contract of insurance. Had the correct facts been stated, OPs might have put the assured to some vigorous tests to determine his state of health. The OPs might not have accepted the contract of insurance, had correct facts been disclosed by the proposer to them. We find no merit in the complaint and hold that there is no deficiency in service on the part of OPs. Resultantly, the complaint is dismissed without any order as to cost”.

10.   From the facts on the record, it is manifest that the DLA had not disclosed the fact of a previously obtained insurance policy, the existence of which is not denied by the appellant herein. In view of the law laid down by the Hon’ble Supreme Court in Satwant Kaur (supra), the contention of the appellant that the non-disclosure of the existence of the previous policy was not a material fact cannot be accepted, since the contract of insurance is one of uberrima fides. In view of the foregoing, the order of the State Commission cannot be held to be erroneous that warrants any interference.

11.    For the reasons mentioned above and in light of the facts and circumstances of this case, the contentions of the appellant do not sustain. The appeal consequently fails and is dismissed. Order of the State Commission is affirmed. There shall be no order as to costs.

12.    All pending IAs if any, stand disposed of with this order.