Before  the District Consumer Dispute Redressal Commission [Central], 5th Floor                                         ISBT Building, Kashmere Gate, Delhi

                               Complaint Case No.-200/05.07.2019

1. Smt. Mahavti Devi W/o Late Garib Sah

2.Master Shiv Kumar
minor son of late Garib Sah

3.Ms. Shivani,
minor daughter of Late Garib Sah


[no.2 minor son and no.3 minor daughter through

their
mother and  natural guardian Mahavti Devi/no.1]

All R/o H.No. 170, Shahbad Mohamad Pur,

New Delhi -110061                                                                 ...Complainants

                                                                   Versus

HDFC Life Insurance Company. Limited

[earlier HDFC Standard Life Insurance Co. Ltd].

Regd. Office at 13th Floor, Lodha Excelus,

Apollo Mills Compound N.M. Joshi Road,

Mahalaxmi, Maharashtra, Mumbai - 400011

Branch Office at:- 24-G, First and Second Floor,

Community Centre, Behind PVR Cinema Complex,

Vikas Puri, New Delhi - 110018                                               ...Opposite Party

                                                                                                    PS: I.P. Estate

                                                                         Order Reserved on:    15.03.2023

                                                                        Date of Order:             03.05.2023

Coram: Shri Inder Jeet Singh, President

              Shri Vyas Muni Rai,    Member

              Ms. Shahina, Member -Female

Inder Jeet Singh

                                             ORDER

1.1. (Introduction to case of parties) :  Briefly, Garib Sah purchased medi-claim policy from OP,  he was hospitalized but succumb on the same very day of admission during the validity of policy, however, death claim made by his nominee/legal heirs was denied by OP on frivolous ground that he was suffering from Hepatitis-B, prior to issuance of policy. Garib Sah was quite hale and healthy at the time of taking policy.

1.2. Whereas, OP opposed the complaint that life assured had concealed material facts, apart from making false declaration to specific health details of life to be assured, he was suffering from Hepatitis-B prior to insurance policy and the surveyor appointed had also discovered so, during investigation. There is breach of contract. The claim was rightly declined, even by review committee.

1.3. There are many routine objections in the reply of OP, therefore, relevant pleadings and dispute will be referred for effective adjudication.

2.1 (Case of complainant)  - Garib Shah (hereinafter referred as the deceased) was husband of complainant No.1 and father of other complainants No.2 and 3.  They are legal heirs of deceased. Garib Sah had purchased a Medi Claim policy bearing No. PP000151 (Member No.ANI 2900, LAN XVFPDLI00001998212 from the OP and the policy was issued on 28.5.2017 after completing all the requirements. He was earning his livelihood as labour at Marble Market, Sector 20, Dwarka, New Delhi. On 05.01.208, he was admitted in Lok Nayak Hospital, New Delhi  and died by his natural death in the said Hospital, on 5.1.2018 itself [his death certificates are now CW-1/7 and CW-1/8, respectively issued by Lok Nayak Hospital and North DMC).  

2.2. The complainant No.1 for herself and also as a guardian of complainant No.2 and 3 lodged death claim with the OP, registered as Claim no.PC082465 UIN no. 101N096V01 on the life of Garib Sah  but the Claim review Committee of OP sent claim rejection letter dated 10.5.2018 (now CW-1/5), which is based on false and frivolous ground stating that during the investigation, it has discovered that the Life Assured was suffering from Hepatitis-B prior to the issuance of policy. Whereas life assured Shri Garib Sah was quite hale and healthy at the time of
issue of policy; neither he was suffering from any such disease nor he was
attended any medical institution or doctor, thus the observation of the claim Review Committee
of the OP is absolutely false,
frivolous and without  any ground. The
OP has illegally and unlawfully
rejected the death claim on the life assured
 Garib Sah.  The  nominee of assured also got issued legal notice dated 25.2.2019 (now CW1/9 & CW1/10) but no result.

          The OP is liable to pay death claim of life assured of Rs. 3,77,252/- towards death benefits along with interest @ 18% p.a. from
the date when the death compensation became
payable to the complainants. The
OP has caused acute harassment the complainants, due to rejection
of death claim of the complainants, they claim compensation of Rs.2 lakhs apart from costs of Rs.51,000/-.

2.3.  The complainants have filed copies of -  bank accounts passbook, adhar cards of complainants, pan card, letter dated 10.5.2018, death certificates and legal notice.

3.1 (Case of OP) -  At the outset, OP is HDFC Life Insurance Company Limited, formerly known as HDFC Standard Life Insurance Company Limited. The reply is being by HDFC Life Insurance Company Limited through authorised employee by authority letter dated 15.4.2019 (Annexure A). OP denies all allegations against it except to the extent the content(s) thereof are specifically admitted.

          The Policy Holder availed a Term Loan from Cholamandalam Investment and Finance Company Limited, being a financial institution, in order to protect the family members of the insured persons/group members from burden of repaying the outstanding loan to the financial institution, at the time of sanction of loan urges the debtors to enroll as a Scheme Member of HDFC Life Group Credit Protect Plus Insurance Plan. Further, Cholamandalam Investment and Finance Company Limited is the master policy-holder of Group Policy no.PP000151 and  complainants are scheme members and they, at the time of availing loan, duly opted to become Scheme members of HIDFC Life Group Credit Protect Plus Insurance Plan (Insurance plan brochure and master policy are Annxure-B & insurance certificate is Annexure-C). They chose single life as cover type which covers death benefit payable to nominee of scheme member. He had remitted an amount of Rs.6,000/- to OP. As per complaint, the assured was admitted in
Lok Nayak Hospital, New Delhi on 05.01.2018 and died a
natural death.

3.2     The deceased had not fulfilled the requirement of policy and paragraph no. 3 of reply reproduces the short medical questionnaire of member enrolment form, which deals with health details of life to be assured, however, the questions were replied/declared in 'negative'. On 28.03.2018,  it was nominee/brother of the deceased, who lodged death claim with OP stating that the immediate cause of death of the deceased policy holder was 'problem in stomach' (copy of death claim form is Annexure-D). Then on receipt of the death claim, on 10.04.2018 OP appointed Probe India to investigate the death claim of the policy polder. The Investigator submitted a report dated 28.04.2018 (copy of report is Annexure-E), its findings were shocking to the OP. The Policy Holder was found suffering from liver disease due to which he was treated at Lok Nayak Hospital, Delhi, Dr. Pankaj Kumar, Delhi and Joint Hospital The Investigator also traced documentary evidence of a few pre-policy laboratory reports of 2016. Thus, the Policy Holder at no point of time had disclosed his illness to the OP and non-disclosure of material facts by the policy holder is violation of the terms and conditions of the policy.  OP relies upon P.C. Chako  and Anr. Vs. Chairman, LIC 2007 (13) SCALE  329 that the claim was dismissed for non disclosure of material facts being in violation of terms and conditions of insurance policy.  Further reliance is placed on Sr. Divisional Manager, LIC Vs Smt. Gangamma, 2002 (III) CPJ 56 (NC) and LIC Vs. Minikalita 2002 (III) CPJ 10 (NC), that very material facts were suppressed, insurance company was held right in rejecting the claim. OP denies the claim of complainants that there was mental agony and acute harassment to complainants.

3.3. The OP also opposed the  complaint that complainant's are not consumer being not nominee of the deceased as well as this Commission lacks the jurisdiction since parties have agreed that courts at Mumbai will have exclusive jurisdiction to settle any disputes. 

4. (Replication)- The complainants filed their replication  to the reply, they reaffirm the complaint as correct.

5. (Evidence of parties) - The complainant No. 1 filed affidavit of evidence for herself and for other complainants. The evidence is on the lines of complaint coupled with documents. On the other side Sh. Kunal Arora, Deputy Manager, Legal and Attorney of OP filed affidavit of evidence, it is also pattern of reply with documents.

6. (Final hearing)- Both the parties filed their written arguments, followed by oral submissions by Sh. R.K. Singh Advocate for complainant and Sh. Ravinder Kumar Aggarwal Advocate with Ms. Ruchika Advocate for OP.

7.1 (Findings) - The contention and case of both the parties are considered in the light of material on record, which also includes documentary record. There is rival plea as on the one side complainants claim their bona-fide in the claim lodged and on the other side they are allegation of false claim and mala-fide, apart from the other stand mentioned in paragraph no. 3.3. above. Their contentions will be dealt one by one.

          The OP had taken objection that the present Forum/Commission lacks the jurisdiction since parties have agreed that the courts at Mumbai will have exclusive jurisdiction, while relying upon A.B.C. Laminart Pvt. Ltd. Vs. A.P. Agencies, Salem [1989 (2) SCC 163]. However, the reasons of OP are misplaced, since the consumer dispute being dealt by the present Commission/Forum is by virtue of creation by the Statute of  the Consumer Protection Act 1986, it is special piece of legislation and Consumer Forum/Commission is not a Civil Court, the inter-se agreement between the parties on the point of concurrent jurisdiction would not oust the jurisdiction of the Consumer Forum/Commission. Moreover, provisions of the Act 1986 are in addition to and not in derogation other law in force, by virtue of section  3 of the Act 1986.

 7.2.  At the outset, there is no dispute that Sh. Garib Shah had taken subject insurance policy for sum insured of Rs. 3,77,252/- against payment of premium and the said Sh. Garib Shah admitted in Lok Nayak Hospital on 05.01.2018, where he died on the same very day. But the disputes revolves around issues of suppression of disease or non-disclosure of correct information of pre-existing disease and complainants are not nominee of the deceased to file the complaint. The further discussion will be on these two core issues.

7.3.  According to complainant, Sh. Garib Shah had nominated his brother in the policy but it does not bar the widow and children of deceased to file the complaint. Whereas the plea of OPs, once a nominee is appointed, the complaint could be by the nominee only.

7.3A    It is matter of record that complainant's brother was appointed as a nominee, his name is Lakshmi Sah and he had lodged the claim with OP [claim form is Annexure-D to the reply of OP]. Actually, the role of nominee is to interact with the institution, receive the amount and then to disburse the amount to legal heirs of deceased as per entitlement and nothing more. It does not bar on legal heirs to proceed,  even if there is nominee The appointment of nominee does not create rights in the assets, property and claims. Otherwise, nominee had lodged the claim with OP. The present complaint was filed under the Consumer Protection Act 1986 and as per the definition of complainant in section (2)(b)(v), the complainant includes legal heirs or representative of 'consumer'. Since Garib Sah was consumer of OP and the present complainants are  legal heirs/ representative of deceased consumer Garib Sah. They are competent to file the complaint.

7.4  By analysing the record, OP has objection that Garib Sah was suffering from liver disease in 2016 prior to taking the insurance policy on 28.05.2017 and the investigator was appointed by the OP, he had carried the thorough investigation from the neighbour in the locality, where it was surfaced that he was patient of liver disease and he died of same ailment in Lok Nayak Hospital Delhi. Whereas on the other side, it is opposed vehemently. There is no documentary record prepared or collected or proved by the OP that the said Garib Sah was suffering from liver disease. In fact, he was not suffering from any such disease and that is why there was no occasion for finding any record.  In order to deny the valid claim, false  plea is being taken by the OP.

7.4A   Simply, there is a twin plea of OP, firstly Garib Sah was suffering from liver disease in 2016, it was suppressed and secondly it was discovered in the investigation, consequently exclusion clause (page-26 clause no. 6-liver disease ) will be applicable.

          The OP has also filed its investigation report (Annexure E/pages 36-42) and at page 37-38 of the report, it is detailed that not only from the Gram Pradhan but also from the neighbors it was enquire who told orally that Garib Sah was suffering from liver disease, he was treated at Lok Nayak Hosopital, by Dr. Pankaj Kumar, Delhi, joint hospital and trauma centre. The report is accompanying with ultrasound on 15.11.2017 of Begusarai. During the course of arguments, it was specifically enquired about existence of record 2016 and adjournment was also given, however, no documentary record of 2016 was discovered by the OP. Moreover, it was also enquired the name of neighbors who told so authentically that he was suffering from liver disease, even the name of those neighbor were not mentioned. There was no discovery of any record or fact from the primary/community health centre, when contacting by the investigating officer of OP. To say, OP had taken the stand that Garib Sah was suffering from liver disease from 2016 and prior to the date of policy of 28.05.2017, however, these facts have not been proved by OP. The oral enquiry would not substitute the factual fact, as OP's investigating officer made a report  as if treatment was taken by Garib Sah from Dr. Pankaj Kumar or joint hospital or trauma centre but no record was discovered by him nor actually the investigating officer had approached those hospital. The fact of Garib Sah's admission and his death in Lok Nayak Hospital is not disputed.

7.5  The analytical discussion of case of parties and the conclusion drawn in paragraphs  7.3A and 7.4A above, establishes the case of complainants that despite valid claim, the OP failed to honour it as well as OP also failed to establish that there was applicability of exclusion clause. The complainants have succeeded to establish deficiency in services for want of settle of valid claim.

8.1.    Thus, complainants are held entitled for sum assured amount of Rs.3,77,252/- from OP. The complainant has sought interest @18% pa, however, considering facts & features of case as well as they were deprived of claim, interest @ 6%pa would be justified  for both ends, interest will be from the date of complaint till realisation of amount against the OP.

8.2. The complainants have also sought damages of Rs.2,00,000/- towards harassment and mental agony; considering totality these circumstances including the breach of  their confidence, damages are quantified as Rs 37,700/-  apart from cost of litigation of Rs.10,000/-in their favour and against the OP.

8.3. Accordingly, the complaint is allowed in favour of complainants and against the OP to pay assured sum of Rs.3,77,252/- along-with simple interest @ 6%pa from the date of complaint till realization of amount;  apart from to pay damages of Rs.37,700/- & costs of Rs.10,000/- to complainants. 

          OP is also directed to pay the amount within 30 days from the date of receipt of this order. In case amount is not paid within 30 days from the date of receipt of order, the interest will be 9% per annum on assured sum of Rs.3,77,252/-.  

9. In view of above conclusions, the complaint is disposed off. Copy of this Order be sent/provided forthwith to the parties free of cost as per rules for necessary compliance.

10: Announced on 3rd May, 2023 [वैशाख 13 , साका 1945].

[Vyas Muni Rai]                        [ Shahina]                            [Inder Jeet Singh]

           Member                            Member (Female)                              President