Haryana

Karnal

CC/194/2023

Balbir Singh - Complainant(s)

Versus

Life Insurance Corporation Of India - Opp.Party(s)

Ms. Seema Bhardwaj

24 Oct 2024

ORDER

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION, KARNAL.

 

                                                        Complaint No.194 of 2023

                                                        Date of instt.27.03.2023

                                                        Date of Decision: 24.10.2024

 

 

1. Balbir Singh son of Shri Ranjeet Singh.
2. Sheeta daughter of Balbir Singh.
3. Anmol minor son of Balbir Singh through his father Balbir Singh being his natural guardian and next friend.

All residents of village and post office Chogawan, Tehsil Indri, District Karnal.

                                                                        …….Complainants.

                                              Versus

 

 

Life Insurance Corporation of India, Division office, P.O. Box no.106, Jeevan Prakash, 489, Model Town, Karnal through its Divisional Manager.

 

                                                                        …..Opposite Party.

 

 

Complaint under Section 35 of Consumer Protection Act, 2019.

 

 

Before   Shri Jaswant Singh……President.     

              Ms. Neeru Agarwal…….Member

      Ms. Sarvjeet Kaur…..Member

 

 Argued by: Ms. Seema Bhardwaj, counsel for complainants.

                    Shri L.R. Chuchra, counsel for the OP.

 

                     (Sarvjeet Kaur, Member)

ORDER:   

                

                  The complainants have filed the present complaint under Section 35 of the Consumer Protection Act, 2019 against the opposite party (hereinafter referred to as ‘OP’) on the averments that the wife of the complainant no.1 and mother of complainants no.2 and 3 namely Rajwanti had purchased a Life Insurance Policy no.129576941 on 28.03.2019 for a sum of Rs.2,00,000/- from the OP by paying the premium of Rs.11,399/-. Rajwanti paid two installment of premium to the OP and thereafter, due to spread of covid-19, she could not pay one installment in the year 2021 to the OP, but thereafter Rajwanti got the policy renewed from the OP on 04.05.2022 by paying the one due installment. Unfortunately, Rajwanti expired on 06.05.2022. After the death of Rajwanti, complainants lodged the claim with the OP and submitted all the required documents to settle the claim but OP did not pay the claim ad repudiated the same, vide letter dated 31.10.2022 on the ground that deceased life assured was suffering from kidney problem, fluid overload, uremic encephalopathy, sepsis with multi organ involvement, homodialysis prior to revival. The said ground of repudiation of the claim of complainants, is totally illegal and unjustified as Rajwanti was not suffering from any disease at the time of purchase of the policy and she was thoroughly examined by the doctor of the OP and after verifying the credentials of Rajwanti, the OP issued the policy. Complainants requested the OP to pay the insured amount but OP is adamant and has refused to pay the claim amount and as such, the complainants. Due to this act and conduct of OP complainants have suffered mental pain, agony and harassment as well as financial loss. In this way there is deficiency in service and unfair trade practice on the part of the OP. Hence, complainants filed the present complaint seeking direction to the OP to pay Rs.2,00,000/- as insured amount alongwith interest @ 18% per annum, to pay Rs.1,00,000/- as compensation to the complainant on account of mental pain and agony and to pay Rs.55000/- towards the litigation expenses.

2.             On notice, OP appeared and filed its written version raising preliminary objections with regard to maintainability; cause of action; locus standi and concealment of true and material facts. On merits, it is pleaded that the claim of the complainants was considered on merits and it was not found payable, so the claim of the complainant was repudiated and decision has been conveyed vide registered speaking letter dated 31.10.2022. The policy no.129576941 was taken by Smt. Rajwanti wife of Balbir Singh from Branch office Jagadhri for sum assured of Rs.2,00,000/- under Plan and Term 836-21-15 (LIC’s Jeevan Labh Plan) with date of commencement of 28.03.2019. The policy became lapse due to non-payment of premium from 03/2021 to 03/2022 and policy was revived on 04.05.2022 on the basis of “Personal Statement of Health” dated 04.05.2022. The life assured expired on 06.05.2022. The duration of policy from revival date was only two (02) days. Hence, the claim was examined keeping in view of provisions of Section 45 of the Insurance Act, 1938 which says that “A policy of life insurance may be called in question at any time within three years from the date of insurance of policy or the date of commencement of risk or the date of revival of policy or the date of the rider to the policy, whichever is later on the ground of fraud,” so investigation was conducted and during investigation it was revealed that the life assured was suffering from kidney problem prior to revival of policy for which she was admitted in Park Hospital, Karnal on 26.04.2022, vide IPD no.15767 and was discharged on 30.04.2022 and problem was kidney damage. She was diagnosed “known case of CKD-5 days.” As per discharge summary of Park Hospital, the deceased life assured was admitted hospital on 26.04.2022 in Emergency with chief complaints of shortness of breath from few hours, drowsy but arousable since few hours, high grade fever and generalized bodyache and weakness. Diagnosis arrived at the hospital was chronic kidney disease-5 D (Twice weekly), fluid overload, Uremic encephalopathy, right IJ Cath in Situ, sepsis with multi organ involvement and three sessions of hemodylisis were done on dated 26.04.2022, 28.04.2022, 29.04.2022 and transfused with one unit of blood cells on 29.04.2022. The policy was revived on 04.05.2022 i.e. after admission and treatment in hospital, but this material information was not disclosed and false answers given in personal statement of health. The risk on the life of the deceased was accepted by the OP on the basis of the answers, statement and declaration made by her in the personal statement of health and it is evident from above that the policy was revived fraudulently by concealment of material information which was very much in the knowledge of deceased life assured at the time of revival of policy and keeping in view of whole record the competent authority repudiated the claim with forfeiture of renewal premium and decision was duly conveyed to claimant/complaint vide speaking registered letter dated 31.10.2022. It is further pleaded that nominee was also suggested by the OP in repudiation letter dated 31.10.2022 that if they are not satisfied/disagree with the said decision then they may represent within three months from date of receipt of repudiation letter for review of their claim alongwith all supporting documents to the Zonal Manager, LIC of India New Delhi, but without exhausting the said speedy remedy, the complainants filed complaint under reply which is an abuse on the process of law and is premature one. There is no deficiency in service and unfair trade practice on the part of the OP. The other allegations made in the complaint have been denied and prayed for dismissal of the complaint.

3.             Parties then led their respective evidence.

4.             Learned counsel for the complainants has tendered into evidence affidavit of Balbir Singh Ex.C1/A, copy of Aadhar cards of complainants Ex.C1 to Ex.C3, copy of Aadhar card of Ms.Rajwanti Ex.C4, copy of death certificate Ex.C5, insurance policy Ex.C6, renewal policy Ex.C7 and Ex.C8, copy of insurance policy Ex.C9, copy of repudiation letter dated 31.10.2022 Ex.C10, copy of declaration form dated 04.05.2022 Ex.C11, copy of detail regarding rejection of claim Ex.C12, copy of treatment record of Rajwanti Ex.C13 and closed the evidence on 30.10.2023 by suffering separate statement.

5.             On the other hand, learned counsel for the OP has tendered into evidence affidavit of Anju Arora, Manager Ex.OP1/A, copy of insurance policy Ex.OP1, copy of proposal from Ex.OP2, copy of discharge summary Ex.OP3, copy of declaration form dated 04.05.2022 Ex.OP4, copy of death certificate Ex.OP5, copy of claim enquiry report Ex.OP6, copy of Investigator observation Ex.OP7, copy of repudiation letter dated 31.10.2022 Ex.OP8 and closed the evidence on 18.07.2024 by suffering separate statement.

6.             We have heard the learned counsel for the parties and perused the case file carefully and have also gone through the evidence led by the parties.

7.             Learned counsel for complainants, while reiterating the contents of the complaint, has vehemently argued that wife of complainant no.1 namely Rajwanti (since deceased) during his life time purchased a life insurance policy for the sum assured of Rs.2,00,000/-. Insured died on 06.05.2022 due to heart attack. The complainants lodged the claim under the abovesaid Policy and submitted all the required documents with the OP but OP did not pay the claim and repudiated the same on the false and frivolous ground and lastly prayed for allowing the complaint.

8.             Per contra, learned counsel for OP, while reiterating the averments made in the written version, has vehemently argued that the policy became lapse due to non-payment of premium and policy was revived on 04.05.2022. Life assured expired on 06.05.2022, so the duration of policy was only two days from the date of revival and the claim was examined and during investigation, it was revealed that the life assured was suffering from kidney problem prior to revival of policy. She was diagnosed “known case of CKD-5 days” but this material information which was in the knowledge of life assured, was not disclosed in the “Personal statement of health” dated 04.05.2022. Thus, the claim of complainants was rightly repudiated by the OP, vide letter dated 31.10.2022 and lastly prayed for dismissal of the complaint.

9.             We have duly considered the rival contentions of the parties.

10.           Admittedly, Rajwanti (since deceased) purchased a life insurance policy in the year 2019, for the sum assured of Rs.2,00,000/-. It is also admitted that the policy in question was revived on 04.05.2022. It is also admitted that complainant no.1 is the nominee in the policy in question.  It is also admitted that the life assured expired on 06.05.2022, during the subsistence of the policy in question.

11.           The claim of the complainant has been repudiated by the OP, vide repudiation letter Ex.C10/Ex.OP8 dated 31.10.2022 on the ground of suppression of material facts.

12.           The claim of complainants has been repudiated by the OP on the abovesaid ground. OP has alleged that life assured was admitted in Park Multi Superspecialty Hospital, Karnal on 26.04.2022 and discharged on 30.04.2022 and as per record of said hospital life assured admitted in hospital with complaint of “shortness of breath since few hours, Drowsy but arousable since few hours, high grade fever and generalized bodyache and weakness” and she was diagnosed for “Chronic kidney disease-5D (twice weekly), fluid overload, uremic encephalopathy, right IJ cath in situ,”. The onus to prove its version was relied upon the OP but OP has miserably failed to prove the same by leading any cogent and convincing evidence. The case of the OP is based upon discharge summary Ex.OP3. The said discharge summary is a photocopy.  Moreover, OP neither examined the doctors who issued the said discharge summary nor tendered his affidavit in evidence to prove its version. Thus, the said discharge summary has no weightage in the eyes of law. In this regard, we are fortified with the observation of Hon’ble Supreme Court in case law titled as Sulbha Prakash Motegaoneka Versus Life Insurance Corporation of India, in civil appeal no.8245 of 2015, decided on 05.10.2015; wherein Hon’ble Supreme Court held that the suppression of information regarding any pre-existing disease, if it has not resulted in death or has no connection to cause of death it would not disentitle the claimant for the claim. Further, in Chanda Devi Vs. LIC in complaint no.551/2016, decided on 23.11.2021 of Hon’ble Delhi State Commission wherein Hon’ble State Commission, Delhi held that if the reason of the death is not in nexus with pre-existing disease and there is no evidence placed on record by the OP to show that the death was on account of pre-existing disease of the life assured, then the contention of the OP in the repudiation letter has no merit. Further, in case Sucha Singh Vs. Head Brach Office, HDFC Life and Another 2022 CJ 901 (NC) wherein Hon’ble National Commission held that death due to heart attack-claim repudiated on ground of pre-existing ailment-complaint dismissed by State Commission-Insurance Company cannot travel beyond grounds mentioned in repudiation letter-When policy has been revived, it revives from date when it was originally issued-Insurance Company had failed to prove that insured had concealed his medical conditions on the date when he took policy-There is nothing on record to show that deceased was suffering from chronic alcoholic condition and was suffering with chronic liver disease and that he submitted fake documents at the time of obtaining original policy-State Commission had adopted wrong approach while rejecting complaint-Respondent shall pay to complainant assured amount alongwith 9% interest. Further in case titled as Bajaj Allianze Life Insurance Co. Ltd. and others Vs. Vinod Kumar Kaushik (since deceased) 2021 CJ 956 (NC), Hon’ble National Commission has held that Mediclaim-Family Care First Plan (Medical Policy)- Surgery for total hip replacement- Non-settlement of claim by Insurance Company on ground of pre-existing condition-Complaint allowed by Fora below-Averments made by OP were not supported by documentary evidence-OP relied on treatment record relating to past history of insured, which were neither verified not supported by proper evidence-In absence of any evidence, it cannot be said that insured was having any past history-Petitioners have failed to point any illegality or irregularity in order passed by State Commission, warranting interference in exercise of Revision-Revision Petition dismissed. Further in case titled as SBI Life Insurance Co. Ltd. Vs. Lakshiben Naginbhai Chauhan and others 2020 CJ 110 (NC) and Authorized Signatory, Hon’ble National Commission has held that Insurance-SBI Home Loan Master Policy-Repudiation of death claim on ground of concealment of pre-existing disease-Complaint allowed by fora below-Both District Forum and State Commission had reached to conclusion after going through all documents that medical papers have not been properly proved since neither doctor has been duly examined nor his affidavit has been furnished-National Commission is not expected and required to re-appreciate and re-assess evidences-where on the basis of evidences Fora below have reached to a conclusion which is a possible conclusion, then such conclusion need not be disturbed in Revision Petition-Revision petition dismissed. Further in case titled as Bajaj Allianz Life Insurance Co. Ltd. and 2 others Versus Kanduru Gangadhara Rao in Revision Petition no.1054 of 2020, decided on 07.10.2021 Hon’ble National Commission held that Insurance Law-concealment of disease-Death claim repudiated by insurer on ground that life assured suppressed her health condition of her taking treatment for  placed reliance on the treatment record, ‘Chronic non-specific cervicitis’ prior to obtaining the policy-Hence this complaint-Held, insurance company placed reliance on treatment record, which was a mere photocopy and not certified. The Doctor who treated the Life Assured was also not examined nor was his affidavit filed by the insurance company. Also, insurance company failed to satisfy this Commission that there was any co-relation between death of the Life Assured and the suppression of ailment "Chronic non-specific cervicitis". Complaint allowed.

13.  

“It seems that the Insurance Companies are only interested in earning the premiums which are rather too stiff now a days, but are not keen and are found to be evasive to discharge their liability. In large number of cases, the Insurance companies make the effected people to fight for getting their genuine claims. The Insurance Companies in such cases rely upon clauses of the agreements, which a person is generally made to sign on dotted lines at the time of obtaining policy. This is, thus pressed into service to either repudiate the claim or to reject the same. The Insurance Companies normally build their case on such clauses of the policy, but would adopt methods which would not be governed by the strict conditions contained in the policy”.

 

 14.          Keeping in view, the ratio of the law laid down in aforesaid judgments, facts and circumstances of the present complaint, we are of the considered view that act of the OP while repudiating the claim of the complainants amounts to deficiency, which is otherwise proved as genuine one. 

15.           As per insurance policy Ex.C6/Ex.OP1, the sum assured is Rs.2,00,000/-. Hence, the complainants are entitled for the all the benefits under the policy in question alongwith interest, compensation for mental harassment and litigation expenses etc.

16.           Thus, as a sequel to abovesaid discussion, we allow the present complaint and direct the OP to pay Rs.2,00,000/- (Rs.two lakhs only) i.e. sum assured  to the complainants alongwith interest @ 9% per annum from the date of repudiation of the claim  i.e. 31.12.2022 till its realization in equal shares. We further direct the OP to pay Rs.25,000/- to the complainants on account of mental agony and harassment and Rs.11,000/- towards the litigation expenses. This order shall be complied with within 45 days from the receipt of copy of this order. The parties concerned be communicated of the order accordingly and the file be consigned to the record room after due compliance.

 

Dated: 24.10.2024                                                           

                                                                  President,

                                                     District Consumer Disputes

                                                     Redressal Commission, Karnal.

 

(Neeru Agarwal)           (Sarvjeet Kaur)

                   Member                          Member