Order by:

Sh.Amrinder Singh Sidhu, President

1.       The complainant has filed the instant complaint under section 35 of the Consumer Protection Act, 2019 on the allegation that Husband of the complainant namely Sh.Joginder Singh Son of Sh. Pritam Singh obtained Life cover Insurance Policy from the Opposite Parties no.1 & 2 bearing Policy No.CD000028 Dated 26.07.2019. The insurance policy issued by the Opposite Parties no.1 and no.2 was the group insurance policy in the name of Opposite Party no.3 and the husband of complainant was member of the above insurance policy. As per the allurement of the Opposite Parties No.1 & 2, husband of the complainant has taken a Medical Insurance Policy from the Opposite Party no. 3. As per represented by the officials of the Opposite Parties no.1 & 2, the said Policy covers life risk of Rs.16, 70,000/- and at the time of issuing the said policy, the husband of complainant paid the premium Rs.17,893/- to Opposite Party no.3. In the month of October/November, 2019 unfortunately the husband of the complainant suffered some health problem and was admitted in D.M.C. Hospital, Ludhiana on 04.11.2019 and Doctors of D.M.C. diagnosed husband of the complainant and it was found that he is suffering from liver disease. The husband of the complainant ultimately died on 06.02.2020. As per the said Insurance Policy the complainant is nominee of her deceased husband namely Sh. Joginder Singh. As per terms and conditions of the said Group Insurance Policy, the Opposite Parties are liable to pay the death claim to the complainant on account of the death of her husband Joginder Singh. Thereafter the complainant time and again approached the Opposite Parties with a request to settle and pay the claim, but every time the Opposite Parties postponed the matter on one or the other false pretext. The complainant has already submitted all the documents as required by the Opposite Parties and also fulfilled all the requirements. On account of non settlement of claim of the complainant, she suffered mental tension and harassment. Complainant also served a legal notice dated 30.10.2020, through her counsel upon the Opposite Parties, which was duly received by Opposite Parties, but they never replied to it nor complied with the same. Hence this complaint. Vide instant complaint, the complainant has sought the following relief:-

a)       Opposite Parties may be directed to pay the death claim of Rs.16,70,000/- to the complainant on account of death of her husband.

b)      To pay an amount of Rs.2,00,000/- as compensation on account of mental tension, pain any agony.

c)       And any other relief which this Commission may deem fit and proper be granted to complainant in the interest of justice and equity.

2.       Opposite Parties no.1 & 2 appeared through counsel and contested the complaint by filing written version taking preliminary objection therein inter alia that the complaint filed by the Complainant is not maintainable and is liable to be dismissed as the Complainant has attempted to misguide and mislead this Commission. The Answering Opposite Parties have arrangement with Fullerton India Credit Company Limited whereby the borrower of the loan from Fullerton India Credit Company Limited may also avail Insurance Cover under the group policy i.e. Kotak Complete Cover Group Plan and Fullerton India Credit Company Limited. As per the said Policy contract, Fullerton India Credit Company Limited is the Policy Holder and the person who intends to secure the loan amount may also avail life Insurance known as 'Member'. In group insurance policies, as per the said policy contract, a group of members specified by the policyholder (in the member data submitted by the Policyholder) availing any loan from the policyholder for specific purposes as specified in the schedule of the policy contract may be covered by the Answering Opposite Party under the group insurance policy for the period and amount, as specified in the Certificate of Insurance (COI), issued to every such specified member subject to the terms and conditions of the policy. The Answering Opposite Party shall receive a premium amount from the policyholder on behalf of members seeking subscription to the said cover for the specified period for the specific number of members. It is also submitted that the member has to provide a duly signed Declaration of Good Health (DOGH) thereby assuring the Insurer that the member is medically fit for availing the said insurance cover. In all such requests for seeking Insurance Cover, as a mandatory process, the member has to submit a declaration of good health asserting that he/she is medically fit to avail the insurance benefits. In view of the same, the certificate of insurance (COI) is issued. However, upon the death of the member, it was revealed during the investigation that the member was suffering from a past ailment and had taken treatment in the past, as a result, the insurance company is well within its rights to repudiate the said claim of the Complainant. Since the Answering Opposite Party has acted within the four corners of the statutory provisions, no case of deficiency in services can be said to have arisen. The repudiation of the Death claim under the subject over was on the grounds of not disclosing true, correct, and complete information of medical history. Further, the policy falls under the non-medical category. It is further submitted that no medical examination was conducted before granting the subject cover and the case was considered under the nonmedical category. The member did not provide any information before issuance of the Cover that he had "Multiple SOL of liver, with Ascites prior to the issuance of the policy and the same was lastly developed into Chronic Liver disease with hypertension" and he was under treatment for the same. If he had disclosed the same the Answering Opposite Party Shall Conduct the medical tests. It is required to mention that life cover is granted on the life of a medically fit person only. Further the contract of insurance is based on the foundation of good faith i.e. principle of Uberrimae fide. The policy is a legal contract between Life Assured and the Insurer and they both are bound by its terms and conditions. Further alleges that the DOGH/Proposal Form is not merely a document to be signed and submitted for formality. It is the basis for the contract of insurance. It is the mode of providing information to the insurer so as to enable them to exercise a lawful right to evaluate the life before providing its services by covering the said life. A reference is most respectfully made here to Regulation 4 (8) of the IRDA (Protection of Policyholders' Interests) Regulations, 2017 which provides that "Proposal form" means a form to be filled in by the prospect in written or electronic or any other format as approved by the Authority, for furnishing all material information as required by the insurer in respect of a risk, in order to enable the insurer to take informed decision in the context of underwriting the risk, and in the event of acceptance of the risk, to determine the rates, advantages, terms and conditions of the cover to be granted; Explanation: "Material Information" for the purpose of these regulations shall mean all important, essential and relevant information sought by insurer in the proposal form and other connected documents to enable him to take informed decision in the context of underwriting the risk; Further, as per the provisions of Regulation 11 (1) and Regulation 11 (3) of the IRDA (Protection of Policyholders' Interests) Regulations, 2002, the contents of which have been reproduced herein below, the Life Assured was under a bounden obligation, to disclose all material information to the Company, at the time of proposal. "11. (1) The requirements of disclosure of "material information" regarding a proposal or policy apply, under these regulations, both the insurer and the insured. 11 (3) The policyholder shall furnish all information that is sought from him by the insurer and also any other information which the insurer considers as having a bearing on the risk to enable the latter to assess properly the risk sought to be covered by a policy." Further alleges that medical check-up/medical examination is not warranted in every proposal rather than the same is conducted depending on various factors viz; age, health condition, habit, income, Sum assured opted, plan opted, disclosures made by the Insured/member, nature of work the proposed insured is involved, etc. Under the subject case, the subject policy was granted only on the basis of the declaration made by the Life Assured informing the Opposite Party that he had no medical adversity and his health condition is good. It is required to mention here that life cover is granted on the life of a medically fit person only. It is required to mention here that had the Company/Opposite Party known that the Life Assured/member has not disclosed his correct health status at the time of the issuance of the policy, then the Company would have declined the proposal. Opposite parties no.1 & 2 put reliance on judgements i.e. Satwant Kaur Sandhu Vs. New India Assurance Company Ltd. SC 2776 of (2006) the Hon'ble Supreme Court, Life Insurance Corporation of India & Ors. Vs. Smt. Asha Goel & Anr. (2001) ACJ 806, Apex Court in P.C. Chacko and Another Vs. Chairman, Life Insurance Corporation of India and others AIR 2008 SC 424, Reliance Life Insurance Co Ltd & Anr Vs Rekhaben Nareshbhai Rathod Civil Appeal No. 4261 of 2019, Life Insurance Corporation of India Vs. Manish Gupta in Civil Appeal No.3944 of 2019 @ SLP © No.5001/2019.No. 5001/2019. Further alleges in facts of the complaint that in accordance to policy terms, and to join the pool of members, Mr. Joginder Singh (Deceased) who had taken a loan facility from Fullerton India Credit Company Limited in the capacity of his being a Borrower of Master Policyholder, had submitted his Application-cum-Declaration of Good Health (DOGH) for Loan Id CD000028_451800110525045_3 to become a Member under the Master Policy. Accordingly, Certificate of Insurance with flat cover was issued to Mr.Joginder Singh (Deceased) as token to his life cover.

          As an acknowledgment of extending insurance cover to the Member, a Certificate of Insurance was issued to him. The Certificate of Insurance (COI) was duly received as admitted by the Complainant. Further Certificate of Insurance states that if Mr. Joginder Singh (Deceased) was not satisfied with the policy he may cancel the policy in the free look period. Further, the Company has not received the Free look cancellation request in captioned policy hence it is clear that Mr. Joginder Singh (Deceased) had read and agreed upon the terms and conditions of the Certificate of Insurance. Thereafter, the Company has received the claim intimation form dated 21.03.2020 forwarded to Answering Opposite Party by the Policyholder/Master Policyholder on 12.06.2020 informing therein that the member Mr. Joginder Singh had died on 06.02.2020. The cause of death was mentioned as “Cancer" in the claim intimation form filled out by the nominee. That, after the receipt of the said claim intimation, the Company had conducted a statutory investigation under rule 14(2) of the Insurance Regulatory and Development Authority (Protection of Policyholders interest) Regulations, 2017 in order to verify the authenticity of the said claim. It was revealed that the Deceased Member had concealed the material fact that he was suffering from Multiple SOL of liver, Ascites associated with Complications prior to the date of signing the DOGH, which lastly developed into Chronic Liver Disease with hypertension. During the Investigation following facts and documents were discovered which are as follow:-

a)       The USG Report issued from Jaswal diagnostic center dated 19th July 2019 procured during the assessment of the claim;

b)      The Medical document issued by Dr. Kultar Singh dated 19th July 2019 procured during the assessment of the claim;

c)       The FNAC issued from G.G.S Medical college and Hospital dated 17th August 2019 procured during the assessment of the claim;

d)      The Discharge Summary issued from Dayanand Medical College and Hospital, Ludhiana dated 04th November 2019 procured during the assessment of the claim;

e)       The Medical document issued by Dr. Nitin Shankar Behl dated 25th January 2020 procured during the assessment of the claim;

Hence it is clearly suggested that the Deceased Life Insured had knowledge of his medical history, which he has not disclosed to the answering Opposite Party Company. Had the Company/Opposite Parties  know that the Life Assured/member had not disclosed his correct health and lifestyle details in the proposal form, then the Company would have declined the proposal upfront. Had the above-mentioned facts were informed to the Answering Opposite Parties, the subject cover policy  would have been declined. In view of the above the Answering Opposite Party Company had, vide its letter dated 15.07.2020 repudiated the claim of the Complainant by explaining the reason behind the same. The same was also intimated to the policyholder vide its letter dated 15.07.2020. Thereafter the Answering Opposite Party company has received a legal notice which was duly replied with Correct facts complainant vide letter dated 03.09.2020. Remaining facts mentioned in the complaint are also denied and a prayer for dismissal of the complaint is made.

3.       Opposite Party No.3 appeared through counsel and contested the complaint by filing written reply taking preliminary objections inter alia that at the outset the Opposite Party denies each and every statement, allegation or contention which is inconsistent with or contradictory to whatever is stated in this written statement and no statement, allegation, or contention, not specifically denied by the Opposite Party shall be deemed to have been admitted, merely for want of a specific traverse. Further alleges that the present complaint is not legally maintainable and the same is liable to be dismissed. The present complaint is liable to be dismissed on the ground that the complainant has not come to this Commission with clean hands and have suppressed the most material facts. The present complainant is hopelessly time barred. The present complaint is liable to dismissed on the ground that complainant is estopped by its own act and conduct. The present complaint is liable to be dismissed on the ground that there is not any cause action against the Opposite Party No.3 and un-necessary dragged into litigation by the complainant, hence the petition is liable to be dismissed. Further alleges that the husband of the complainant namely Joginder Singh r/o H.No.52, Vill.Bhinder Khurd, Tehsil & Distt. Moga had availed the loan facility from the Opposite Party No.3 vide loan agreement no.17709959 dated 22.07.2019 for the sum of Rs.16,87,893/-for the purchase of vehicle Tata 1918 bearing engine No.505008 and Chassis No.F08255 Model 2019. The agreement has been executed between the parties. The husband of the complainant has signed the said agreement with his free will and consent. Hypothecation in this regard is already entered on the registration copy of the vehicle. The said amount was to be repaid by the husband of the complainant in sixty equated monthly installments of Rs.38021/- and he committed the intentional default regarding the payment of loan amount. He has failed to discharge his liability intentionally and now the wife of the borrower filed the present complaint just to delay the recovery of loan amount. The husband of the complainant had entered into loan agreement with the Opposite Party No.3 and both the parties have contractual obligation as such the complainant is liable to pay along with future interest as per terms and condition of loan agreement and the Opposite Party No. 1 and 2 also directed to pay compensation amount to Opposite Party No.3 if the claim of the complainant allowed. The present complaint has not been filed by the proper person so the same is liable to be dismissed. The present compliant is vague, irrelevant and not maintainable against the Opposite Party No.3. The present complaint is liable to be dismissed since there is clear cut case of mis-joinder of parties and Opposite Party No.3 is liable to be deleted from the array of Opposite Party. Remaining facts mentioned in the complaint are also denied and a prayer for dismissal of the complaint is made.

4.       In order to prove his case, complainant has tendered in evidence her affidavit Ex.CW1/A along with copies of documents Ex.C1 to Ex.C5.

5.       To rebut the evidence of complainant, ld. counsel for the Opposite Parties no.1 & 2 tendered in evidence affidavit of Sh.Shakil Ahmad, Deputy Vice President Legal, Kotak Mahindra Life Ins. Co. Ex.OP1 & 2/1 alongwith copies of documents Ex.OPs1 & 2/2 to Ex.OPs1 & 2/13 and another affidavit of Sh.Shakil Ahmad as Ex.OPs 1 & 2/14. Whereas, Opposite Party No.3 tendered in evidence affidavit of Sh.Ajay Kumar Sharma, Attorney of Opposite Party No.3 company Ex.OP3/1 alongwith copies of documents Ex.OP3/2 & Ex.OP3/3.

6.       During the course of arguments, ld.counsel for the Complainant as well as Opposite Parties have mainly reiterated the facts as narrated in the complaint as well as in written reply respectively. We have perused the rival contentions of both the parties and also gone through the record. The contention of the complainant is that Husband of the complainant namely Sh.Joginder Singh Son of Sh. Pritam Singh obtained Life cover Insurance Policy from the Opposite Parties no.1 & 2 bearing Policy No.CD000028 Dated 26.07.2019. The insurance policy issued by the Opposite Parties no.1 and no.2 was the group insurance policy in the name of Opposite Party no.3. As per the allurement of the Opposite Parties No.1 & 2, husband of the complainant has taken a Medical Insurance Policy from the Opposite Party no. 3. As per represented by the officials of the Opposite Parties no.1 & 2, the said Policy covers life risk of Rs.16, 70,000/- and at the time of issuing the said policy, the husband of complainant paid the premium Rs.17,893/- to Opposite Party no.3. In the month of October/November, 2019 unfortunately the husband of the complainant suffered some health problem and was admitted in D.M.C. Hospital, Ludhiana on 04.11.2019 and Doctors of D.M.C. diagnosed husband of the complainant and it was found that he is suffering from liver disease. The husband of the complainant ultimately died on 06.02.2020. As per the said Insurance Policy the complainant is nominee under the said policy. Thereafter the complainant lodged the claim with Opposite Parties and  requested them to settle and pay the claim, but all in vain.      

 7.      Ld. counsel for the Opposite Parties no.1 & 2 repelled the aforesaid contention of ld. counsel for the complainant on the ground that Mr. Joginder Singh (Deceased) who had taken a loan facility from Fullerton India Credit Company Limited in the capacity of his being a Borrower of Master Policyholder, had submitted his Application-cum-Declaration of Good Health for Loan to become a Member under the Master Policy. Accordingly, Certificate of Insurance with flat cover was issued to Mr.Joginder Singh (Deceased) as token to his life cover. The Certificate of Insurance states that if Mr. Joginder Singh (Deceased) was not satisfied with the policy he may cancel the policy in the free look period. Further, the Company has not received the Free look cancellation request in captioned policy hence it is clear that Mr. Joginder Singh (Deceased) had read and agreed upon the terms and conditions of the Certificate of Insurance. Thereafter, the Company on 12.06.2020 has received the claim intimation form dated 21.03.2020 informing therein that the member Mr. Joginder Singh had died on 06.02.2020. The cause of death was mentioned as “Cancer" in the claim intimation form filled out by the nominee. After the receipt of the said claim intimation, the Company had conducted an investigation in order to verify the authenticity of the said claim and it was revealed that the Deceased Member had concealed the material fact that he was suffering from Multiple SOL of liver, Ascites associated with Complications prior to the date of signing the Declaration of Good Health, which lastly developed into Chronic Liver Disease with hypertension. During the Investigation documents which  were discovered, The USG Report issued from Jaswal diagnostic center dated 19^th July 2019, The Medical document issued by Dr. Kultar Singh dated 19^th July 2019, The FNAC issued from G.G.S Medical college and Hospital dated 17^th August 2019. The Discharge Summary issued from Dayanand Medical College and Hospital, Ludhiana dated 4^th November 2019, The Medical document issued by Dr. Nitin Shankar Behl dated 25^th January 2020 were procured during the assessment of the claim. Hence it is clear that the Deceased Life Insured had knowledge of his medical history, which he has not disclosed to the Opposite Parties. Ld. counsel for the Opposite Party No.3 contended that that the husband of the complainant namely Joginder Singh had availed the loan facility from the Opposite Party No.3 vide loan agreement no.17709959 dated 22.07.2019 for the sum of Rs.16,87,893/-for the purchase of vehicle Tata 1918 bearing engine No.505008 and Chassis No.F08255 Model 2019. The agreement has been executed between the parties. The husband of the complainant has signed the said agreement with his free will and consent. Hypothecation in this regard is already entered on the registration copy of the vehicle. The said amount was to be repaid by the husband of the complainant in sixty equated monthly installments of Rs.38021/- and he committed the intentional default regarding the payment of loan amount. He has failed to discharge his liability intentionally and now the wife of the borrower filed the present complaint just to delay the recovery of loan amount. The husband of the complainant had entered into loan agreement with the Opposite Party No.3 and both the parties have contractual obligation.

8.       We have perused the rival contentions of ld. counsel for the parties and have gone through the record before us. Perusal of the contention of the ld.counsel for the complainant shows that written version on behalf of the opposite parties not filed well within time i.e. before 45 days. In this regard, Hon’ble Supreme Court in complaint titled as New India Assurance Co. Ltd.    Vs   Hilli Multipurpose Cold Storage decided on 4^th March, 2020 hold that the District Forum (now Commission) has no power to extend the time for filing the response to the complaint beyond the period of 15 days in addition to 30 days as envisaged under section 13 of Consumer Protection Act, 1986 (now under section 38 (2) of the Consumer Protection Act, 2019) and the commencing point of limitation of 30 days u/s 13 of the Act would be from the date of receipt of notice accompanied with the complaint by the Opposite Party.  In view of this, we do not possess any power to give further time period after completion of 15 days in addition to 30 days as envisaged under section 13 of Consumer Protection Act, 1986 (now under section 38 (2) of the Consumer Protection Act, 2019. As such written reply submitted by the Opposite Parties today be placed on record and however, it is not considerable as referred above.

9.       The other contention of ld. counsel for the complainant is that the written version filed on behalf of Opposite Party has not been filed by an authorized person. Therefore, the written version so filed is not maintainable. The Opposite Party is limited Company and written version has been filed on the basis of special power of attorney given to ld.counsel for the Opposite Party. In this regard, Hon’ble Supreme Court of India in a judgment (2011)II Supreme Court Cases 524 titled as “State Bank of Travancore Vs. Kingston Computers India Pvt. Ltd.” and in para no.11 of the judgment, has held that

“the plaint was not instituted by an authorized person. On the plea that one authority letter dated 02.01.2003 was issued by Sh. R.K.Shukla in favour of Sh. A.K.Shukla. Further plaint failed to place on record its memorandum/articles to show that Sh. R.k.Shukla has been vested with the powers or had been given a general power of attorney on behalf of the Company to sign, verify and institute the suit on behalf of the Company.”

Similar proposition came before the Hon’ble Delhi High Court in “Nibro Ltd. Vs. National Insurance Co. Ltd.”, 2 (2005) 5SCC 30 that the

“bear authority is not recognized under law and ultimately, it was held that the plaint was not instituted by an authorized person. Here also appellant has not placed on record any resolution passed by any Board of Director in favour of Mr. Soonwon Kwon and that he was further authorised to delegate his power in favour of any other person. Further there is no memorandum/articles of the Company to show that Mr. Soonwon Kwon is one of the Director of the Company. In the absence of that evidence on record we cannot say that the special power of attorney given by Director Soonwon Kwon is a competent power of attorney issued in favour of Sh.Bhupinder Singh. In the absence of any resolution of the Company or any memorandum/articles of the Company to show that Sh. Soonwon Kwon is Director and that he was further authorised to issue power of attorney in favour of Sh. Bhupinder Singh.”

Recently our own Hon’ble State Commission, Punjab Chandigarh in FAO No.1235 of 2015 decided on 25.01.2017 in case titled as L.G.Electronics India Private Limited Vs. Sita Ram Chaudhary also held that the plaint instituted by an unauthorized person has no legal effect.

10.     For the sake of arguments, for the time being, if the written reply filed by Opposite Parties is presumed to be correct, now come to the merits. The case of the complainant is that deceased husband of the complainant availed the loan facility from the Opposite Party No.3 for the sum of Rs.16,87,893/-for the purchase of vehicle Tata 1918 bearing engine No.505008 and Chassis No.F08255 Model 2019 in the capacity of being a Borrower of Master Policy holder, he got insured himself under the policy bearing no.CD000028 namely Kotak Complete Cover Group Plan and the complainant is the nominee under the said policy. Unfortunately, husband of the complainant died due to liver disease. The complainant lodged the death claim of her husband with the Opposite Parties no.1 & 2, which was repudiated by the Opposite Parties no.1 & 2. On this plea of the Opposite Parties no.1 & 2 is that husband of the complainant, who had taken a loan facility from Fullerton India Credit Company Limited in the capacity of his being a Borrower of Master Policyholder, had submitted his Application-cum-Declaration of Good Health for Loan to become a Member under the Master Policy. Thereafter on 12.06.2020 the Company has received the claim intimation form dated 21.03.2020 on 12.06.2020 informing therein that the member Mr. Joginder Singh had died on 06.02.2020. The cause of death was mentioned as “Cancer" in the claim intimation form filled out by the nominee. After the receipt of the said claim intimation, the Company had conducted an investigation and during investigation it was revealed that the Deceased Member had concealed the material fact that he was suffering from Multiple SOL of liver, Ascites associated with Complications prior to the date of signing the Declaration of Good Health, which lastly developed into Chronic Liver Disease with hypertension. As the Deceased Life Insured had knowledge of his medical history, which he has not disclosed to the Opposite Parties no.1 & 2, so the claim of the complainant was repudiated. On this plea of ld. counsel for the Opposite Party No.3 is that the husband of the complainant namely Joginder Singh had availed the loan facility from the Opposite Party No.3 for the sum of Rs.16,87,893/-for the purchase of vehicle Tata 1918. Hypothecation in this regard is already entered on the registration copy of the vehicle. The said amount was to be repaid by the husband of the complainant in sixty equated monthly installments of Rs.38021/- and he committed the intentional default regarding the payment of loan amount. He has failed to discharge his liability intentionally and now the wife of the borrower filed the present complaint just to delay the recovery of loan amount.

11.     The actual facts of the complaint are that the husband of complainant namely Joginder Singh aged 45 years s/o Pritam Singh r/o, District Moga intended to purchase a truck for earning his livelihood as he was a driver by profession and he has no other source of his income as proved by document Ex.OPs1 & 2/5 on file. So, he went to Opposite Party No.3 for availing ‘Loan Amount’ for purchasing a truck. Opposite Party No.3 while granting Loan facility had a policy Kotak Complete Cover Group Plan to get the Loanee insured in order to secure their ‘EMI’ as well as ‘Loan Amount’ in event of any casualty of life of Loanee. Opposite Party no.1 and 2 has an arrangement with Fullerton India Credit Co. Ltd. whereby the borrower of the loan from Fullerton India Credit Co. Ltd. may also avail Insurance Cover under the group policy i.e. Kotak Complete Cover Group Plan & Fullerton India Credit Co. Ltd. As per the said policy contract Fullerton India Credit Co. Ltd. is the policy holder and the person who intends to secure the Loan Amount and also avail Life Insurance known as ‘Member’ in group insurance policies, as per the said policy contract, a group of members as specified by the policy holder (in the member data submitted by the policy holder) availing any loan from the policy holder for specific purposes as specified in the schedule of the policy contract may be covered by the Opposite Parties no.1 & 2 under the group insurance policy for the period and amount, as specified in the Certificate of Insurance (COI), issued to every such specified member subject to the terms and conditions of the policy. Opposite Parties no.1 & 2 receives a premium amount from the policy holder on behalf of the members seeking subscription to the said cover for the specific period for the specific number of members.

          In the present case, the husband of the complainant has an intention to purchase a truck for earning his livelihood as he was driver by profession and he has no other source of Income as per documentary evidence which is Ex.OPs 1& 2/5. In order to purchase a truck, he was in need of money and contacted Opposite Party No.3 for availing loan facility for the purchasing of truck. As Opposite Party No.3 had previous arrangement with Opposite Parties no.1 & 2, whereby the borrower of the loan from Opposite Party No.3 may also avail Insurance Cover under the group policy i.e. Kotak Complete Cover Group Plan. So, it is clear that husband of the complainant did not availed insurance policy for merely covering his risk of life, but when he availed loan for purchasing a truck then fortunately Opposite Party No.3 for securing their ‘EMI’ and ‘Loan Amount’ in the event of any total mishappening got him insured from Opposite Parties no.1 & 2. So, the intention of the husband of the complainant is not to purchase/avail policy of life cover but to purchase a truck for earning his livelihood by way of self employment as he was driver by profession and he had no other source of Income. Fortunately, he got covered the risk of life during sanctioning of loan amount as per policy/tendency of Opposite Party No.3 (Loaner) while providing loan amount to Loanee under a policy of ‘Group Insurance policy of life Cover’ in order to secure the Loan amount including EMI’s by Opposite Party No.3. Generally, Loaner get the Loanee insured from Insurance Companies to secure their ‘Loan Amount’ to be recovered. If husband of the complainant had knowledge of his serious disease then he should have not availed loan  for purchasing truck but would have purchased/availed ‘Medical Insurance Policy’ as well as ‘Life Insurance Policy’. Even otherwise when one gets knowledge of any deadly disease then one would not purchase a liability like truck for his family but would purchase/avail heavy life insurance policy in order to benefit his family. The purchase of truck and availing loan on it, itself proves innocence of the husband of the complainant. It is just by luck and chance, he got Life Insurance Policy while availing loan from Opposite Party No.3 for the purchase of truck. There is nothing on record that proves that the insured ‘husband of the complainant has any knowledge of his serious disease before availing Life Insurance from Opposite Parties no.1 & 2 or he had any intention to defraud the Opposite Parties. Moreover, husband of complainant had clear intention of purchasing a truck to earn his livelihood by way of self-employment as he was driver by profession and he had no other source of Income and therefore availed loan from Opposite Party No.3. As Opposite Party no.3 has a policy/trend of getting the Loanee insured in group insurance policy to secure their ‘EMI’ and ‘Loan Amount’ so husband of complainant got fortunately insured by luck and chance in that ‘group Insurance policy’ for life coverage. If the husband had knowledge about his serious disease then he should have not preferred to purchase truck on loan as same may prove financial burden on his family rather he would have purchased ‘Medical Health Insurance Policies for treatment of his disease. Borrower of loan/insured (husband of complainant) left behind illiterate and poor widow and minor children with no other source of any income.

12.     The main point for adjudication vehemently contended before us by Opposite Parties No.1 & 2 is that on scrutiny of the claim documents, it is observed  that that the insured was suffered from Multiple SOL of Liver, Ascites associated with complications prior to the date of signing the Declaration of Good Health, which developed into Chronic Liver Disease. The insured by not disclosing the his past medical history before procuring the policy has violated the policy document and also the core principle of insurance i.e. the Principle of Good Faith and had obtained the policy through concealment of material facts. We do not agree with the aforesaid contention of ld. counsel for the Opposite Parties no.1 & 2, as the policy obtained by the husband of the complainant was against the loan, which was availed by him against the loan of vehicle and at the time of issuing of the policy, the Opposite Parties no.1 & 2 failed to get medical examination of the husband of the complainant. They only on the basis of oral submission of husband of the complainant that he has not any past medical history issued the policy in question. The onus to establish this fact is upon the Opposite Parties in this case as opposite parties have alleged the allegation of defraud by husband of complainant. We have perused the copies of  medical record placed by Opposite Parties of the treating hospital, but there is neither any affidavit nor  complete particulars of the investigator recorded in them. Even the original certificate has not been placed on the record. There is no affidavit of doctor of the treating hospital to establish this fact on the record regarding previous disease of insured.                                                                                                                                                                                                                                                                                                                                                 We are unable to rely upon the above referred investigation report appended with the Photostat copy of  medical record of complainant. In the absence of any affidavit of investigator and the affidavit of treating doctor of the hospital, we do not place any reliance upon these documents, as pressed into service by the Opposite Parties in this case. Consequently, we are of this view that Opposite Parties have failed to discharge the onus solemnly laid upon it to prove this fact that life assured has any knowledge that he was suffering from above pre-existing disease before taking the policy and he deliberately and fraudulently concealed this material fact from Opposite Parties. We, thus, conclude that there is no substantive evidence on the record to prove this fact that life assured has any knowledge that he was suffering from any disease before he took the insurance policy and he willfully suppressed this fact fraudulently from the Opposite Parties. Moreover from the perusal of the Investigation report Ex.OPs 1 & 2/5 shows that investigator wrongly and carelessly pasted the snaps of complainant and his deceased husband in investigation report, he pasted the snap of complainant against the column “Name of Life Assured” and pasted the snap of deceased husband of the complainant against the column “Name of Claimant/Nominee” on Ex.OPs1 & 2/5. So, it shows carelessness on the part of above said investigator. We do not reply upon the said Investigation report on the basis of which the Opposite Parties no.1 & 2 repudiated the claim of the complainant. Moreover, if the life assured was suffering from any diseases prior to issuance of the policy, in question, the same must not have escaped the notice of the empanelled doctors of the Insurance Company. However, no such investigation record has been produced by the opposite parties. In case Bajaj Allianz Life Insurance Co. Ltd. & Ors. Vs. Raj Kumar III (2014) CPJ 221 (NC), it was held by the Hon’ble National Commission that “usually, the authorized doctor of the Insurance Company examines the insured to assess the fitness and after complete satisfaction, the policy is issued. It was held that the Insurance Company wrongly repudiated the claim of the complainant.”

13.     Furthermore, as per prescription slip of Inder Clinic, age of Joginder Singh insured was 45 years as on 19.07.2019 (meaning thereby which is  45 years), so it was the bounden duty of the Opposite Parties-Insurance Company to get the life assured medically examined before issuing the policy in his name who was 45 years of age. In support of his contention Ld.counsel for the complainant placed reliance upon I.R.D.A.I Rules and Instructions with regard to thorough medical examination if the insured is more than 45 years which is reproduced as under:-

“As per instructions issued by the Insurance Regulatory and Development Authority of India (IRDAI), it was bounded duty of the insurer to put insured to thorough medical examination in case Mediclaim insured was more than 45 years and if insurance company failed to do so then insurance company has no right to decline the insurance claim on account of non disclosure of the facts of pre existing disease when the policy was taken. The above observations is supported by law cited in SBI General Insurance Company Limited Vs. Balwinder Singh Jolly” 2016(4) CLT 372 of the Hon’ble State Commission, Chandigarh.”

However, the Opposite Parties-Insurance Company has not placed on record any evidence that before issuing the policy they ever got medically examined the insured. So, the abovesaid law squarely covers the case of the complainant that it was the duty of the insurer to get medically examined while issuing the policy and once the policy was issued the insurer cannot take the plea of pre-existing disease of the insured.

14.     It also needs to be mentioned that Section 19 of the General Insurance Business (Nationalization) Act, 1972 states that it shall be the duty of every Insurance Company to carry on general insurance business so as to develop it to the best advantage of the community. The denial of medical expenses reimbursement is utterly arbitrary on the ground that disease in question was pre-existing disease. It is mere an excuse to escape liability and is not bona fide intention of the insurance company. Fairness and non-arbitrariness are considered as two immutable pillars supporting the equity principle, an unshakable threshold of State and public behavior. Any policy in the realm of insurance company should be informed, fair and non-arbitrary. When the insurance policy has exclusions/conditions to repudiate the claim or limit the liability, the same must be specifically brought to the notice of the insured and are required to be got signed to show that such exclusions and conditions have been brought to his/her notice.  Recently, our own Hon’ble State Consumer Disputes Redressal Commission, Chandigarh in  First Appeal No. 50 of 2019 titled as Bajaj Alliance General Vs. Arjan Singh decided on 04.03.2021 also held so.

15.     The need for interpreting a contract always arises in two situations, (i) when a gap is needed to be filled in the contract and (ii) an ambiguity is needed to be resolved in the contract, then to find out correct intention of the contract, spirit behind it is required to be considered. Normally, the insurance policy is a contract of adhesion in which other party is left with hardly any bargaining power as compared to the insurer. Insurance contracts are standard form contracts and are drafted by the insurance company and as such, insurance company is at higher footing than the insured. The benefit of such clause, as exclusion clause, would go to the insured unless the same is explained in clear terms by the insurer. In such circumstances, the tribunal would be more oriented towards the interpretation which goes against the party who has inserted/drafted the disputed clause in the agreement/contract. The adjudicating authority is required to look into whether the intention of the party is to exclude or limit liability has been appropriately explained to the other party or not. This Commission while interpreting insurance agreement is to honour the intention of the parties, who have signed the agreement. Even if the agreement had general exclusion/condition for misrepresentation still fraudulent misrepresentation and non-disclosure may not be there. The innocent and negligent misrepresentations are to be ignored.  On the other hand, the rulings (i) Satwant Kaur Sandhu Vs. New India Assurance Company Limited, (ii) Life Insurance Corporation of India & Ors. Vs. Smt. Asha Goel & Anr and (iii) Life Insurance Corporation of India Vs Manish Gupta,  cited by the ld.counsel for the Opposite Parties  are not applicable and relevant  to the facts of the present case. 

16.     On the other hand, Opposite Party No.3 filed written arguments stating that the husband of the complainant namely Joginder Singh had availed the loan facility from them for the sum of Rs.16,87,893/-for the purchase of vehicle Tata 1918. The said amount was to be repaid by the husband of the complainant in sixty equated monthly installments of Rs.38021/- however, husband of the complainant failed to discharge his liability. Perusal of the record shows that husband of the complainant died on 06.02.2020 and per the Repayment Schedule 8^th EMI of the loan of husband of the complainant was due on 4^th March, 2020 after his death,  meaning thereby the installments of the loan was due to complainant from the month of March, 2020.

17.     In such a situation the repudiation made by the Opposite Parties regarding genuine claim of the complainant appears to have been made without application of mind. It is usual with the insurance company to show all types of green pesters to the customer at the time of selling insurance policies, and when it comes to payment of the insurance claim, they invent all sort of excuses to deny the claim. In the facts of this case, ratio of the decision of Hon’ble Punjab & Haryana High Court in case titled as New India Assurance Company Limited Vs. Smt.Usha Yadav & Others 2008(3) RCR (Civil) Page 111 went on to hold as under:-

“It seems that the insurance companies are only interested in earning the premiums and find ways and means to decline claims. All conditions which generally are hidden, need to be simplified so that these are easily understood by a person at the time of buying any policy.   The Insurance Companies in such cases rely upon clauses of the agreement, which a person is generally made to sign on dotted lines at the time of obtaining policy. Insurance Company also directed to pay costs of Rs.5000/- for luxury litigation, being rich.

14.     Above discussion clarifies that the husband of the complainant namely Joginder Singh (since deceased) had availed loan facility from opposite party no.3 vide loan agreement no. 17709959 dated 22.07.2019 for the sum of Rs.16,87,893/- (Rupees Sixteen Lacs Eighty Seven Thousand Eight Hundred Ninety Three only) for the purchase of vehicle Tata 1918 bearing engine No.505008 and Chassis No.F08255  Model, 2019 for earning his livelihood as he was driver by profession and had no other source of income. As opposite parties no.1 & 2 have arrangements with opposite party no.3 to provide group insurance policy to safeguard the interest of opposite party no.3 as well as borrower of loan/insured. So, it can be safely concluded that opposite parties no.1 & 2 have arrangement with opposite party no.3 i.e. Fullerton India Credit Company Limited for providing coverage of risk of life of the borrower of loan/insured to safeguard the interest of opposite party no.3. In the present case, husband of the complainant availed loan facility from opposite party no.3 and also availed benefit of insurance coverage for risk of life of borrower of loan/insured provided by opposite parties no.1 & 2. Hence, it is held that the opposite parties no.1 & 2 are liable to make good the loss suffered by opposite party no.3.

Keeping in view of the aforesaid facts and circumstances, we partly allow the complaint of the complainant and direct the opposite parties no.1 & 2 to pay, jointly and severally, to opposite party no.3 the total amount which is due towards the complainant regarding loan amount of Rs. 16,70,000/- as per loan agreement no. 17709959 dated 22.07.2019 as well as interest and penalties etc imposed upon it by opposite party no.3 till the date of its actual realization by opposite parties no.1 & 2. Thereafter, opposite party no.3 is directed to issue certificate of NOC to the complainant and get hypothecation removed from RC of the above mentioned vehicle and get the vehicle Tata bearing no. 1918 bearing engine No.505008 and Chassis No.F08255 Model 2019 transferred in the name of the complainant being legal heir of deceased (borrower of loan/insured). It is further directed that opposite parties no.1 to 3 shall not recover any amount from the complainant. Opposite parties no.1 & 2 shall also pay, jointly and severally, a lump sum compensation of Rs.30,000/- (Rupees Thirty Thousand only) to the complainant on account of causing her harassment and agony. The compliance of this order be made by the Opposite Parties within 60 days from the date of receipt of copy of this order, failing which the complainant shall be at liberty to get the order enforced through the indulgence of this District Consumer Commission.  Copies of the order be furnished to the parties free of costs. File is ordered to be consigned to the record room.

Announced in Open Commission.