KERALA STATE CONSUMER DISPUTES REDRESSAL COMMISSION
VAZHUTHACADU THIRUVANANTHAPURAM
APPEAL NO: 54/2010
JUDGMENT DATED:17..01..2011.
PRESENT
SRI. M.V. VISWANATHAN : JUDICIAL MEMBER
The Divisional Manager,
Life Insurance Corporation,
Divisional Office,
Jeevan Prakash, PB No.66, : APPELLANT
Sagat Road, Bikanear P.O &
District Rajasthan, Rep. by the
Divisional Manager, LIC of India,
Divisional Office, Kottayam.
(By Adv.Sri.G.S. Kalkura)
Vs.
James George,
Elanjimuttathil House, Aruvithura.P.O,
Erattupetta Village, Meenachil Taluk, : RESPONDENT
Kottayam.
(By Adv.Sri.K.R. Ramachandran)
JUDGMENT
SRI. M.V. VISWANATHAN : JUDICIAL MEMBER
Appellant was the opposite party and the respondent was the complainant in CC.321/08 on the file of CDRF, Kottayam. The complaint therein was filed alleging deficiency of service on the part of the opposite party, the Divisional Manager, LIC of India, Divisional Office, Bikaneer in repudiating the insurance claim preferred by the complainant with respect to the policy No.502063292 issued by the Divisional Manager, Bikaneer, Rajasthan. The opposite party issued repudiation letter repudiating the insurance claim on the ground of suppression of material facts by the life assured, Saramma.P.K while submitting the proposal for the said policy. The opposite party reiterated the contention regarding suppression of material facts by the written version filed by them.
2. Before the Forum below, the complainant, the husband of the life assured, Saramma.P.K filed proof affidavit. Exts.A1 to A4 documents were also marked on his side. The Manager of the 1st opposite party filed proof affidavit in support of the contentions adopted by the opposite party in their written version. Exts.B1 to B5 documents were also produced and marked on the side of the opposite party, LIC of India. On an appreciation of the evidence on record, the Forum below passed the impugned order dated:31st October 2009 directing the opposite party to deposit the insured sum of Rs.1.lakh with interest at the rate of 9% per annum from the date of repudiation till payment in the name of the minor nominee, Dhanya James in a nationalized bank till the minor attains majority. The opposite party is also directed to pay cost of Rs.1,500/- to the complainant. Aggrieved by the said order, the present appeal is filed by the opposite party therein.
3. When this appeal was taken up for final hearing, there was no representation for the respondent/ complainant, though Vakalath was filed by Adv.K.R.Ramachandran on behalf of the respondent/complainant. This commission was pleased to hear the learned counsel for the appellant/opposite party. He submitted his arguments based on the grounds urged in the memorandum of the present appeal and argued for the position that there was suppression of material facts regarding the state of health of the life assured while submitting the proposal for the policy. Thus, the appellant justified the action of the opposite party in repudiating the insurance claim. It is further submitted that the decision reported in 2009, CTJ -73 (CP)(NCDRC) has no application to the facts and circumstances of the present case. Thus, the appellant prayed for setting aside the impugned order passed by the Forum below.
4. The points that arise for consideration are:-
1. Whether the appellant/opposite party can be justified in repudiating the insurance claim preferred by the respondent/complainant in CC.321/08?
2. Whether the appellant/opposite party has succeeded in establishing their case regarding suppression of material facts by the life assured, Saramma.P.K while submitting B4 proposal for the aforesaid life policy?
3. Is there any legally sustainable ground to interfere with the impugned order dated:31/10/09 passed by CDRF, Kottayam in CC.321/08?
5. Points 1 to 3:-
There is no dispute regarding the facts pleaded by the complainant and the opposite party in CC.321/08. Admittedly respondent/complainant, James George is the husband of Saramma.P.K she had taken the life policy bearing No.502063292 dated:26-3-2007. Ext.A1 is copy of the said policy certificate. The aforesaid life policy commenced on 30/3/2007. For getting the aforesaid life policy, the life assured Saramma.P.K submitted B4 proposal in the prescribed proposal form. The submission of B4 proposal is not disputed by the respondent/complainant. In B4 proposal specific questions were put to the proposor regarding the health of the life assured. To those specific questions, the proposor/life assured had given the answers to the effect that she is not having any sort of illness and she had not undergone treatment for any of the illness referred to in the proposal. It was also submitted that the proposor is having good state of health on the date of submission of the said proposal. B4 proposal was submitted on 26/3/2007. The following questions were put to the proposor under the caption Personal History.
(a) During the last 5 years did you consult a medical practitioner for any ailment requiring treatment for more than a week? To the said question, the proposor/life assured answered in the negative. Likewise the proposor, Saramma.P.K had also given negative answers to the following questions.
(b) Have you ever been admitted to any hospital or nursing home for general check up, observation, treatment or operation?
(c) Have you remained absent from place of work on grounds of health during the last 5 years?
6. Thus, the proposal subscribed by the life assured would make it clear that she had given a declaration that she is having good health on the date of the said proposal and she had not suffered any ailment 5 years previous to the submission of the proposal. The life assured had also given the declaration that in the event it is found that the contents of the proposal are not true or correct, the LIC of India will be at liberty to rescind the contract of insurance and forfeit the monies paid to the corporation.
7. Ext.B1 medical certificate dated:25/9/2007 would show that the life assured Saramma.P.K had undergone treatment for PID (Prolapsed Inflammatory Disease) from 19/10/2004 to 2/11/2004 and that she had also undergone treatment for low back ache/Sciatic Syndrome from 14/2/2007 to 15/3/2007. The entries in B1 certificate is not disputed by the respondent/complainant. Thus, B1 certificate would make it abundantly clear that the life assured, Saramma.P.K had given incorrect statement or information regarding her health while submitting B4 proposal dated:26/3/2007. This would in turn strengthen the case of the opposite party/LIC of India that the life assured suppressed material facts regarding her health at the time of submitting the proposal for the policy.
8. B2 and B3 certificate of hospital treatment and medical attendance certificate dated:21/8/2007 would show that the life assured Saramma.P.K died due to acute Pancreatitis with multiple organ failure. It is true that B2 and B3 documents would show that the life assured died not due to prolapsed inflammatory disease or due to low back ache (Sciatic Syndrome). The lower Forum may be correct on its finding that there was no nexus between the cause of death and the facts suppressed by the life assured. But it is come out in evidence that the life assured suppressed material facts regarding her state of health at the time of submitting the proposal for the policy. The definite case of the appellant/opposite party, LIC of India is that the proposor was aware of the illness of the prolapsed inflammatory disease or sciatic syndrome. More over, it is now well settled that the insurer can very well repudiate the policy of insurance in the event it is found that the life assured had suppressed material facts. The decision rendered by the Hon’ble Supreme Court in P.C.Chacko Vs. LIC of India reported in 2008 SAR 445 would make the legal position more clear. It is held that the insurer is at liberty to repudiate the insurance claim and also to rescind the contract of insurance on detecting suppression of material facts. It is also to be noted that the informations collected by the insurer by putting specific questions to the insured in the form of questions can be taken as relevant informations for exercising the option as to whether the proposal is to be accepted or rejected. By giving false answers or incorrect informations while submitting the proposal for the policy would entitle to the insurer to repudiate the insurance claim on the ground of suppression of material facts. It is pertinent to note at this juncture that the life policy issued in the name of Saramma.P.K commenced on 30/3/2007 and that the life assured died on 21/8/2007. It can be seen that the life assured expired within 5 months of issuance of the policy. This circumstance would also justify the action of the opposite party/LIC of India in repudiating the insurance claim based on suppression of material facts regarding the state of health. The Forum below cannot be justified in considering the suppression of material facts as not relevant because of the fact that there was no nexus between the facts suppressed and the cause of death. The Forum below went wrong in relying on the decision rendered by the Hon’ble Naional Commission in LIC of India and Another Vs. Smt. Chandrakanta Lahande, 2009 CTJ 73 (CP) (NCDRC). The facts of the aforesaid reported case cannot be made applicable to the facts of the present case. It is to be noted that the illness suffered by the life assured in the present case cannot be treated as simple head ache, back pain, acidity or indigestion. The life assured, Saramma.P.K had been suffering from prolapsed inflammatory disease for a long time she had also availed leave facilities from her employer for treatment of the aforesaid ailments. It is also to be noted that just few days back, the life assured Saramma P.K had availed leave for the very same disease of low back ache/ sciatic syndrome. This circumstance would give a clear indication that the life assured purposefully and deliberately suppressed material facts regarding her state of health while submitting the proposal for the policy. It is to be noted that the said proposal for the policy was submitted on 26/3/2007. At the same time she was on leave on medical ground from 14/2/2007 to 15/3/2007. But the life assured Saramma.PK suppressed that fact while submitting B4 proposal dated:26/3/2007. So, the facts of the aforesaid reported case cannot be equated to the facts of the present case on hand. Thus, the available evidence on record would make it clear that the appellant/opposite party, LIC of India is justified in repudiating the insurance claim preferred by the respondent/complainant.
9. The foregoing discussions and the findings thereon would make it clear that there was no deficiency of service on the part of the appellant/opposite party, LIC of India in repudiating the insurance claim preferred by the respondent/complainant being the legal heir and husband of the life assured, Saramma.P.K. The appellant/opposite party is justified in repudiating the insurance claim on the ground of suppression of material facts regarding the state of health of the life assured while submitting the proposal for the policy. The impugned order passed by the Forum below is liable to be quashed. The complaint in CC.321/08 deserves dismissal. These points are answered accordingly.
In the result, the appeal is allowed. The impugned order dated:31/10/2009 passed by CDRF, Kottayam in CC.321/08 is set aside. The complaint therein is dismissed. The parties are directed to suffer their respective costs through out.
M.V. VISWANATHAN : JUDICIAL MEMBER
VL.
