Haryana

StateCommission

A/586/2016

BAJAJ ALLIANZ LIFE INSURANCE CO. - Complainant(s)

Versus

JASVINDER KAUR - Opp.Party(s)

VARUN CHAWLA

06 Dec 2016

ORDER

STATE CONSUMER DISPUTES REDRESSAL COMMISSION HARYANA, PANCHKULA

                                                 

First Appeal No  : 586 of 2016

Date of Institution: 29.06.2016

Date of Decision : 06.12.2016

 

1.      Bajaj Allianz Life Insurance Company Ltd. Plot No. 271, Phase-II, Industrial Area, Panchkula -1311015, Haryana through its Manager.

2.      Bajaj Allianz Life Insurance Company Ltd., SCO-215-217, 4^th Floor, Sector 34-A, Chandigarh

(through Mr. Rajinder Singh Kalsi, Zonal Legal Manager (North), Bajaj Allianz Life Insurance Company Limited, SCO -215-217, Sector-34, Chandigarh.

                                      Appellants-Opposite parties

 Versus

 

Smt. Jasvinder Kaur wife of Late Sh. Ranjeet Singh Resident of Village Khanahmepur, Post Office Alipur, Tehsil Barara, Distt. Ambala.

                                     

                                      Respondent- Complainant

 

 

CORAM:             Shri B.M. Bedi, Judicial Member.

                             Shri Diwan Singh Chauhan, Member   

 

Argued by:          Sh. Varun Chawla, Advocate for the appellants.

                             Sh. Amandeep Bindra, Advocate for the respondent

 

                                                   O R D E R

 

B.M. BEDI, JUDICIAL MEMBER

 

          Bajaj Allianz Life Insurance Company Ltd. and its functionaries-opposite parties are in appeal against the order dated 18.04.2016 passed by the District Consumer Disputes Redressal Forum, Panchkula (in short, ‘District Forum’) vide which the complaint was allowed and opposite parties were directed to pay sum assured of Rs.2,50,000/- alongwith interest at the rate of 9% p.a. from the date repudiation i.e. 05.04.2010, Rs.20,000/- as compensation and Rs.5000/- as litigation expenses to the complainant.

2.      Jasvinder Kaur-complainant filed complaint submitting that her husband Ranjeet Singh (deceased) purchased Life Insurance Policy with assured sum of Rs.2,50,000/- on 06.10.2008. He died on 10.09.2009.  Complainant being nominee lodged the claim. However, opposite parties repudiated the claim on the ground that at the time of purchase of policy, the insured did not disclose true and correct information of his health.

3.      The opposite parties contested the complaint by raising plea that Ranjeet Singh purchased Life Insurance Policy with assured sum of Rs.2,50,000/- on 06.10.2008 and premium was payable annually.  At the time of purchase of the policy, life assured had concealed that he was suffering from Psychiatric problem.

4.      District Forum after hearing both the parties allowed the complaint and issued directions to the appellants as mentioned in opening para of this order.

5.      Opposite parties have come up in appeal.

6.      Opposite parties have placed on the file the prescription slips (Exhibit R-8, R-9, R-10, R-12 R-13, R-14, R-15 & R-16) showing that the life assured have been suffering from Psychiatric problem and was under treatment of Bharti Psychiatric Hospital, Yamuna Nagar.  Opposite parties have placed on the file statement made by Jasbir Kaur sister of the life assured (Exhibit R-7).  Opposite parties have also placed on the file certified copy of the statement of Dr. Vikram Bharti, Consultant Psychiatrist, Bharti Psychiatric Hospital, Yamuna Nagar who was treating the life assured and has stated that the life assured was suffering from Paranoid Schizophrenia and this illness affects the mind and is equivalent to insanity. It is well settled principle of law that if contract of insurance is entered into as a result of fraudulent suppression of material facts by policy holder, the policy is vitiated and person holding assignment of policy cannot claim benefit of contract. Support to this view can be had from Mithoo Lal V. Life Insurance Corporation of India , AIR 1962 Supreme Court 814.

7.      Hon’ble Apex Court in Modern Insulators Ltd. Vs. Oriental Insurance Co. Ltd. – (2000) 2 SCC 734 held as under:-

“It is the fundamental principle of insurance law that utmost good faith must be observed by the contracting parties and the good faith forbids either party from non-disclosure of the facts which the parties know.  ………..”

8.      In Revision Petition No.967 of 2008, Life Insurance Corporation of India versus Smt. Neelam Sharma, decided on September 30^th, 2014, Hon’ble National Commission observed as under:-

“8.       In Satwant Kaur Sandhu vs. New India Assurance Company Ltd. (2009) 8 SCC 316, it has been observed by the Supreme Court that the expression “material fact” is to be understood in general terms to mean as any fact which would influence the judgment of a prudent Insurer, in deciding whether to accept the risk or not.  If the proposer has knowledge of such fact, he is obliged to disclose it particularly while answering questions in the proposal form.  Any inaccurate answer will entitle the Insurer to repudiate their liability because there is clear presumption that any information sought for in the proposal form is material for the purpose of entering into a contract of insurance, which is based on the principle of utmost faith –uberrima fides.  Good faith forbids either party from non-disclosure of the facts which the party privately knows, to draw the other into a bargain, from his ignorance of that fact and his believing the contrary. (See: United India Insurance Co. Ltd. Vs. M.K.J. Corporation [(1996) 6 SCC 428].  It has also been emphasized that it is not for the proposer to determine whether the information sought for is material for the purpose of the policy or not. Of course, obligation to disclose extends only to facts which are known to the applicant and not to what he ought to have known.”

“11.     Having given our anxious consideration to the material on record, we are of the opinion that the answers given by the Insured in the proposal form were untrue to his knowledge. There was clear suppression of “material facts” in regard to the health of the Insured.  It was not for the Insured to determine whether the information sought for in the aforesaid questionnaire was material for the purpose of the two policies…..”  

9.      From the evidence available on the record, it is manifest that the statement made in the proposal was untrue and incorrect.  This Commission is, therefore, of the view that the Insurance Company was justified in repudiating the claim of the complainant. Thus, the District Forum fell in error in allowing the complaint and did not consider this aspect. The appeal is accepted, impugned order is set aside and the complaint is dismissed.

10.    The statutory amount of Rs. 25000/- deposited at the time of filing the appeal be refunded to the appellants against proper receipt and identification in accordance with rules, after the expiry of period of appeal/revision, if any.

 

Announced 06.12.2016 DK

(Diwan Singh Chauhan) Member

(B.M. Bedi) Judicial Member