Madhya Pradesh

StateCommission

A/14/1884

SATISH K DIKSHIT - Complainant(s)

Versus

LIC - Opp.Party(s)

29 May 2024

ORDER

M. P. STATE  CONSUMER  DISPUTES  REDRESSAL  COMMISSION,                         

PLOT NO.76, ARERA HILLS, BHOPAL

 

FIRST APPEAL NO. 1884 OF 2014

(Arising out of order dated 31.07.2014 passed in C.C.No.230/2014 by District Commission, Gwalior)

 

SATISH KUMAR DIXIT,

S/O SHRI KRISHNALAL DIXIT,

R/O NEAR POWER HOUSE, SIKANDER,

QAMPOO, GWALIOR (M.P.)                                                                     …   APPELLANT.

 

         Versus

 

LIFE INSURANCE CORPORATION OF INDIA,

REGIONAL OFFICE, JEEWAN PRAKASH BUILDING,

CITY CENTRE, GWALIOR M.P.

THROOUGH MANAGER, HEALTH INSURANCE.                                    ...   RESPONDENT.  

 

BEFORE :

            HON’BLE SHRI A. K. TIWARI                : ACTING PRESIDENT

            HON’BLE DR. SRIKANT PANDEY        :          MEMBER

           

COUNSEL FOR PARTIES :

                Shri Hemant Sharma learned counsel for the appellant.

           Ms. Chitra Sharma, learned counsel for the respondent.

 

O R D E R

(Passed On 29.05.2024)

                                The following order of the Commission was delivered by A. K. Tiwari, Acting President: 

                   The complainant/appellant has filed this appeal against the order dated 31.07.2014 passed by the District Consumer Disputes Redressal Commission, Gwalior (for short ‘District Commission’) in C.C.No.230/2014 whereby the District Commission has dismissed the complaint filed by him.

2.                Briefly stated facts of the case are that the complainant had obtained health policy LIC/S-Health Plan Policy after depositing first

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premium of Rs.8,000/- on 21.05.2009. The duration of subject policy was 25 years and the next yearly premium was to be paid in June 2009. It is submitted by the complainant that on 25.05.2013 he had stomachache and consulted the doctor who diagnosed that there is a stone in gall bladder. The doctor fixed the operation on 07.06.2013. To meet out the expenses incurred in the said operation, the complainant made a claim for a sum of Rs.1,12,200/- with the insurance company. The opposite party-insurance company vide letter dated 21.09.2013 repudiated the claim on the ground that the complainant was suffering from diabetes since last eight years. The complainant made a request to the insurance company that his claim has wrongly been repudiated. In fact, he was suffering from diabetes since last seven-eight months but the doctor by mistake wrote seven-eight years. The doctor also accepting his mistake has given certificate to that effect. It is alleged that despite that the insurance company did not accept the claim of the complainant. The act of the insurance company falls under the category of deficiency in service and unfair trade practice. The complainant therefore filed a complaint before the District Commission seeking claim of Rs.1,12,200/- expenses incurred in treatment along with interest @ 18% with compensation of Rs.25,000/- and costs Rs.10,000/-.

 

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3.                The opposite party-insurance company in its reply before the District Commission has submitted that in the prescription filed by the complainant it is written that the complainant is suffering from diabetes since last seven-eight years and the complainant suppressed this material fact about his health in the proposal form intentionally at the time of taking subject policy on 21.05.2009. Since the complainant was suffering from the said disease before taking the policy, therefore the complainant is not entitled to get any relief. On 21.09.2013, MD, TPA has already rejected his claim. The complainant filed an application for reconsideration of claim which was sent MD, TPA who in turn after reconsidering the same rejected the said claim again on 26.11.2013. The opposite party insurance company did not commit any deficiency in service or unfair trade practice while repudiating the claim of the complainant. 

4.                The District Commission dismissed the complaint holding that since the complainant had suppressed the material facts regarding his illness and in the proposal form while obtaining the subject insurance policy, therefore the insurance company cannot he held guilty of deficiency in service.

5.                Heard learned counsel for the parties. Perused the record.

6.                Learned counsel for the complainant/appellant argued that the District Commission has committed material irregularity in not going

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through the evidence and other related documents filed on record. He argued that the District Commission did not consider this fact that before the subject claim also the insurance company by allowing an another claim paid compensation to the complainant. He argued that the District Commission on the basis of prescription given by the doctor that the complainant is suffering from diabetes held that there was suppression of pre-existing disease whereas the concerned doctor has given a certificate that by mistake instead of 7-8 months, 7-8 years was written in the prescription which is evident from the certificate. He therefore prayed for setting aside the impugned order of dismissal of complaint.

7.                Learned counsel for the opposite party-insurance company submitted that the policy was issued on the basis of information given by the insured. After examination, the claim filed by the complainant was repudiated and the complainant was informed. In the proposal form the complainant has submitted that he is not suffering from any disease whereas from the prescription of Arora Hospital it is clear that the complainant insured was suffering from Diabetes since last 8 years. Since there was suppression of material fact which amounts to violation of policy terms and conditions, the complainant is not entitled to get any claim. There has been no deficiency in service on part of the insurance company

 

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in repudiating the claim. She therefore supporting the impugned order prayed for dismissal of appeal.

8.                We have given thoughtful consideration to arguments advanced by learned counsel for the parties and carefully perused the record as also the impugned order. R-8 is a proposal form dated 15.05.2009 filled by the complainant in order to obtain the policy. In the said proposal form in clause 6 in answer to the query raised “Have you suffered/suffering from any any of the following (b) Diabetes”, he had given answer in ‘No’.

9.                R-6 is prescription dated 25.05.2013 of Arora Hospital, Gwalior  (R-6) wherein it has been specifically mentioned that patient-complainant is suffering from Diabetes since last 8 years. Thus, it is clear that the complainant was suffering from Diabetes since last 8 years.

10.              The insurance company vide letter dated 25.07.2013 (C-3) wherein it is stated that the patient has history of Diabetes from 8 years i.e. prior to inception of policy (policy start date 21.05.2009) Hence current illness is Pre-existing as per policy terms and conditions, so claim is repudiated on the ground of pre-existing illness and suppression/non-disclosure of material facts and information while taking the policy.

11.              By challenging the said repudiation letter in order to clarify the complainant has given an application dated 09.10.2013 (C-4) to the

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insurance company stating that the doctor by mistake on the prescription has written Diabetes since 7-8 years in place of 7-8 months and had filed a certificate of Arora Hospital dated 04.10.2013 (C-5). In the said certificate, the concerned doctor had written “It is certified that Mr. Satish Dixit S/O K. L. Dixit is suffering from diabetes and he is on treatment since 8-9 months. By mistake in prescription it was written 8 year. Kindly correct it.”

12.              Admittedly, after filling up the proposal form on 15.05.2009 the complainant had obtained insurance policy, however, he has not given any information about his previous ailment in the proposal form more particularly in the queries raised regarding his state of health. From the prescription of Dr. Anita Arora, Arora Hospital dated 25.05.2013 (R-6) it is clear that the patient/complainant was suffering from Diabetes since last 8 years. Later after repudiation he had given an application to the insurance company and certificate obtained by the concerned doctor that inadvertently the doctor has mentioned 7-8 years instead of 7-8 months. This process after repudiation of claim appears to be an after thought.

13.              In the column of declaration in the proposal form, the deceased-insured has declared that “If there is any misstatement or suppression of material information or if any untrue statements be contained therein the said contract shall be absolutely null and void and all

 

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moneys which shall have been paid in respect thereof shall stand forfeited to the company.”

14.              In view of the aforesaid, it is clear that at the time of taking insurance policy, the complainant was suffering from Diabetes but he did not disclose this important fact to the insurance company. The contract of insurance is based on utmost good faith and it is well settled that in case of suppression of material fact, the claimant is not entitled to any relief. Thus, we are of a considered opinion that the insurance company has committed no error or deficiency in service in repudiating the claim of the complainant.

15.              Hon’ble Supreme Court in Bajaj Allianz Life Insurance Co. Ltd. & Ors Vs Dalbir Kaur IV (2020) CPJ 60 (SC)  has clearly held that the finding of material misrepresentation or concealment in insurance has a significant effect upon both the insured and the insurer in the event of a dispute. The fact it would influence the decision of a prudent insurer in deciding as to whether or not to accept the risk is a material fact. There is a clear presumption that any information sought for in the proposal form is material for the purpose of entering into a contract of insurance.

19.              In the light of the aforesaid judgment of Hon’ble Supreme Court and in the facts and circumstances of the case we find that the

 

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insurance company has not committed any deficiency in service in repudiating the claim.

20.              In view of the aforesaid discussion, we are of the opinion that the District Commission has committed no error in dismissing the complaint. We do not find any illegality or infirmity in the impugned order. Accordingly, the impugned order is hereby affirmed.

21.              In the result, this appeal fails and is hereby dismissed with no order as to costs.

               (A. K. Tiwari)                          (Dr. Srikant Pandey)

            Acting President                             Member