ORDER
(Passed on 13/09/2019)
PER SHRI.ATUL D.ALSI, PRESIDENT.
The complainants have filed this complaint U/s 12 of the Consumer Protection Act,1986 against repudiation of their insurance claim and praying for assured amount of Rs.18 lacs alongwith compensation and cost of proceeding.
2. The facts in short giving rise to this petition are that the deceased Vinod Kawale was the owner of Krushi Kendra and was doing business of selling pesticides, chemical fertilizers, agriculture materials etc. for earning his livelihood by way of self employment. He had obtained credit facility of Rs.14 lacs from OP No.1 IDBI Bank on 14/3/2016. For the security of said facility he had insured himself with the OP No.2 for sum assured of Rs.18 lac by paying premium of Rs.21,570/-. However on 4/6/2014, said Vinod died of sudden brain stroke. Both the complainants being nominee and heirs, raised insurance claim but the OP No.2 repudiated it vide its letter dated 4/6/2014 alleging suppression of material facts regarding earlier treatment while obtaining policy. The complainant issued legal notice praying for reconsideration of claim through Adv.Marliwar on 15/6/2018, but the OP did not comply. Hence, the complainant has filed this complaint.
6. The complaint is admitted and notices were served on the OPs. The OP No.1 and 2 filed their respective reply to the complaing.
The OP No.1 in its reply admitted that it had granted credit policy of Rs.14 lac to the complainant for running Krushi Kendra and that he was regular in repayment of loan, but denied rest of the allegations against them. It averred that the dispute revolves around repudiation of complainants insurance claim, but allowing or rejecting insurance claim is exclusive the domain of OP No.2 Insurance Company and OP No.1 has no role to play in it. Hence the petition may be dismissed as against OP No.1.
The OP No.2 in its reply admitted that it had issued IDBI Federal term insurance life Protection Plan vide policy bearing No.4001001512 in favour of deceased Vinod on 16/1/2017 for the sum assured of Rs.18 lacs to be payable in case of death of the insured. However, while filling the proposal form for obtaining said insurance cover, said Vinod concealed material information regarding his medical history. Said Vinod died on 4/6/2017 of brain stroke. As the death of the insured occurred within one year of iniciation of the insurance cover, the OP No.2 initiated an investigation in the matter. From the investigation report and the City Scan report dated 4/6/2014, it came to knowledge that the deceased had taken medical treatment for head injury. However, he concealed this fact while filling the proposal form and answered the specific querries regarding antecedents of medical history in the negative. Hence the insurance contract is vitiated from said suppression of material fact of earlier ailment. It is a breach of uberima fides i.e. utmost faith which is condition precedent to the contract of insurance and fulfillment of which is compulsory. The deceased Vinod chose not to disclose any of his ailment that the company had procured and the deceased life assured (DLA) in Part IV of the proposal form had answered to the specific querry in this regard in the negative. This itself shows the malafides on the part of DLA while obtaining the insurance policy. Since the very base of contract is fallacious and false, the contract has become void and hence the claim thereunder has been rightly repudiated by the OP No.2. Therefore the petition deserves to be dismissed with cost.
7. Counsel for the complainant argued that the material information had been supplied as per requirement to the OP No.2 at the time of proposal and there is no nexus of City Scan dated 4/6/2014 with the cause of death as per the evidence of Dr.Bharat Ganvir on affidavit. Therefore, repudiation of insurance claim amounts to deficiency in service.
9. Counsel for the OP No.1 argued that the OP No.1 had given credit facility to the deceased Vinod, but they have no role in repudiation of insurance claim. Therefore the petition may be dismissed as against it.
Counsel for OP No.2 argued that as per investigation report of the investigation conducted by the OP No.2 and as per city scan report of the deceased, the DLI had taken medical treatment for his head injury and this fact was suppressed by him while filling proposal form by giving answers to the specific querries in negative, which amounts to breach of terms and conditions of the policy. As such, the insurance contract is vitiated by suppression of material fact and hence the repudiation of insurance claim is just and proper calling no interference from this Forum. Hence the petition deserves to be dismissed with cost.
10. We have gone through the complaint, written versions filed by OP No.1 and OP Nos.2 & 3, affidavit, documents and WNA filed by the parties. We have also heard the oral arguments advanced by parties.
Points Finding
1. Whether the complainant is a Consumer of Op Nos.1 & 2? Yes
2. Whether there is deficiency in service on the part of OP No.1? No
3. Whether the re is deficiency in service on the part of OP No.2? Yes
4. What order ? As per final order..
REASONING
As to issue No.1
Admittedly, the complainant’s husband had availed credit facility from OP No.1 bank and for the security thereof, had insured himself with the OP No.2 under IDBI Federal term insurance life Protection Plan vide policy bearing No.4001001512 on 16/1/2017 for sum assured of Rs.18 lacs. Both the complainants, being legal heirs and nominee under the said insurance plan, are “consumer” within the meaning of Section 2(1)(D) and the services as promised are the services within the meaning of section 2(1)(d)(ii) of CP act. and hence the issue is decided accordingly.
As to issue No.2
12. The dispute is regarding repudiation of insurance claim by OP No.2 for
the reason of suppression of material facts by the insured while obtaining the insurance cover. The OP No.1 is the bank and it has no role in either honouring or repudiating the insurance claim. Hence no fault can be attributed to OP No.1 for the repudiation of insurance claim of the complainants by OP No.2 and as such, there being no deficiency in service on the part of OP No.1, no order is being passed as against it.
As to issue No.2
Admittedly the insurance claim of the complainants is repudiated by the OP No.2 for the reason of suppression of material facts by the DLI while obtaining the insurance cover. For establishing pre existing disease at the time of inception of the policy, the OP No.2 has relied on the City Scan report of the deceased dated 4/6/2014. The insurance cover was obtained by the DLI on 16/1/2017 and admittedly, he had taken treatment from Dr.Bharat Ganvir 3 years prior to inception of the said policy. Said City Scan is procured by the DLI on the reference of Dr.Ganvir who is MBBS MD. However, said Dr.Ganvir, in his evidence by way of affidavit filed on record, has deposed that the deceased Vinod had come to him in the year 2014 for the treatment of his ailment and he was referred for City Scan to Dr.D.B. Nakade, Consultant Radiologist Soniologist and Imagiologist on 4/6/2014. However, after the treatment, said Vinod had recovered from the ailment and was alright shortly. Thereafter, on 16/11/2017, the deceased was again brought for treatment to his clinic, but he died of excessive bleeding due to severe brain haemorrhage attack but there is no nexus between the earlier ailment dated 4/6/2014 and the cause of death which occurred on 16/11/2017 due to brain haemorrhage.
When the previous ailment has no impact on subsequent cause of death, in that case, non disclosure of information about previous ailment cannot be said to be suppression of material fact. Said information cannot be termed as material one and as such non disclosure of the same cannot be termed as breach of terms and conditions of the insurance plan warranting repudiation of insurance claim. Consequently, the repudiation of the claim on this ground is not proper. Therefore, the complainants are entitled for the insurance claim of Rs.18 lac. As the loan obtained by the DLI from OP No.1 is outstanding, complainants are entitled for appropriation of the assured amount towards repayment of outstanding loan of OP No.1. So also they are entitled for compensation of Rs.20,000/- for physical and mental agony and cost of litigation amounting to Rs.10,000/-. Hence the order..
Final order
1. The Complaint is partly allowed as against OP No.2.
2. The complaint is dismissed as against OP No.1.
3. The OP No.2 shall allow the insurance claim of the complainants amounting to Rs.18 lac and appropriate the said amount towards repayment of outstanding loan of OP No.1 and the balance, if any, shall be paid to the complainants.
4. The OP No.2 shall also pay to the complainants an amount of Rs.20,000/- towards compensation for physical and mental agony and further Rs.10,000/- towards cost of litigation.
5. Copy of the order be furnished to both the parties free of cost.
(Smt.Kalpana Jangade (Kute) (Smt.Kirti Vaidya (Gadgil) (Shri.Atul D.Alsi)
Member Member President
