Date of filing: 06-07-2011.

Date of disposal: 14-11-2012.

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM - II:

VIJAYAWADA, KRISHNA DISTRICT

Present: Sri A. M. L. Narasimha Rao, B.Sc., B. L., President

Sri S. Sreeram, B.Com., B.A., B.L., Member

Wednesday, the 14th day of November, 2012

C.C.No.111 of 2012

Between:

Bazaru Bharat Kumar, S/o Murali Krishna, R/o Akkireddy Gudem Post, Musunuru Mandal, Krishna District.

… Complainant

And

1. Life Insurance Corporation of India, Rep. by its Manager, Branch Office:Jeevan Jyothi Building, Nuzuvid, Krishna District.

2 Life Insurance Corporation of India, rep. by its Divisional Manager, Divisional Office, Machilipatnam, Krishna District.

. … Opposite Parties.

This complaint is coming before for final hearing on 30-10-2012 in the presence of Sri D. Ravi Kiran, advocate for complainant, Sri P. Ramakrishna Paramahamsa, advocate for opposite parties and having stood over for consideration till this day, the Forum doth order the following:

ORDER:

(Delivered by Hon’ble Member Sri S. Sreeram)

This is a complaint filed by complainant under Sec.12 of Consumer Protection Act with a prayer to direct the opposite .parties 1 and 2 to pay the sum assured amount of Rs.6,25,000/- under policy, to pay interest at 12% p.a. from 22-7-2010 till payment date, to pay compensation and costs.

1. The brief averments of the complaint are as follows:

The complainant is brother of deceased Puli Ravikumar who during his life time taken LIC policy “Jeevan Saral” with profits for a sum assured Rs.6,25,000/-under proposal dt.27-3-2010 from 1st opposite party and the opposite parties issued policy bearing No.676490935 by mentioning the date of commencement as 27-3-2010 and that the said Ravikumar paid premiums and died due to heart attack at his village on 22- 7-2010. It is submitted that the complainant was nominated by deceased for the said policy and the same was accepted by opposite parties. As per the terms and conditions of policy, the complainant being nominee is entitled to receive the claim amount under policy and he applied for payment of policy amount and submitted documents. But the opposite parties neither paid the amount nor gave any reply. While so the complainant submitted application under RTI Act vide letter dt.24-5-2012 and the 2nd opposite party supplied the information and stated that the claim is under process, but so far not paid the amount which amounts deficiency in service. Hence, the complaint.

2. After registering the complaint, notices were sent to the opposite parties. The opposite parties filed its version admitting that the deceased took the policy from them.

But they submitted that the deceased withheld the material information regarding occupation at the time of effecting insurance and that the deceased took the policy which is meant for employees by mentioning that he is an employee in Porus Laboratories Pvt., Ltd., and that after the death of Ravikumar, they made enquiries and learnt that he left the said company on 11-3-2010 itself and as such he is not an employee on the date of commencement of policy and as such the complainant is not entitled to get any amounts under the policy. It is further submitted that the “principle of utmost good faith” was not observed by deceased and complainant while giving personal information and that there is no deficiency in service on the part of opposite parties and prayed to dismiss the complaint.

3. The complainant filed his affidavit and got marked Ex.A1 to A5. The Legal Manager of 2nd opposite party filed affidavit and got marked Ex.B1 and B2.

4. Heard both sides and perused the record.

5. Now the point that arises for consideration in this complaint are:

i) Whether there is any deficiency in service on the part of the opposite parties in repudiating the claim of complainant?

ii) If so is the complainant entitled for the reliefs as prayed for?

6. Point No.1 : On perusing the material on hand (complaint, affidavit and documents), the plea of the complainant is that his brother i.e. deceased Puli Ravikumar had taken LIC policy “Jeevan Saral” from the opposite parties during his life time on 27- 3-2010, which is evident from Ex.A1 policy schedule. Further there is no dispute with regard to payment of premium amounts by deceased and it is not the case of opposite parties that the said policy has lapsed due to default in payments of premium amount. It is also undisputed fact that the deceased had shown the complainant as nominee for the subject policy and Ex.A1 clearly reveals the name of complainant as nominee. Further the opposite parties are not disputing the factum of death of deceased on 22-7- 2010 while the policy is in existence. As such the complainant laid a claim with opposite parties for the subject policy amount by submitting original bond and death certificate vide the letter marked under Ex.A3. He also submitted claimant statement and other documents i.e. Ex.A4 and A5 to opposite parties.

7. On the other hand, the contention of opposite parties is that the policy taken by deceased Ravikumar is meant for employees only i.e. Non-Medical Scheme – General – Professional and that the deceased has misrepresented that he was employee in Porus Laboratories Pvt. Ltd., Kodad and took the policy and that on good faith, they gave policy to deceased. But, after the death of Ravikumar, they made enquiries with the employer of deceased and learnt that the deceased resigned to his job on 11-3- 2010. As such he was not employee on the date of issuance of policy and as such the complainant is not entitled for any amount. It is pertinent to note that the opposite parties except stating that the subject policy is meant for employees only have not filed any document containing such alleged term and condition of the said policy before this Forum to arrive at just conclusion whether the said policy is meant for employees only or not. Admittedly the deceased resigned to his job on 11-3-2010 i.e. just before taking policy and the same is evident from Ex.B2 i.e. letter given by employer of deceased dt.1-8-2011. The opposite parties do not produce the proposal form submitted by the deceased policy holder, at least to show that there was suppression of material fact. In this regard, it is the bounded duty of opposite parties to cause enquiries before issuance of policy that whether the policy holder is an employee or not, more particularly in the light of terms of policy that the said policy is meant for employees. The contention of opposite parties that on good faith they issued policy cannot be accepted as it is the bounden duty of opposite parties to ascertain the said fact of employment before issuance of policy itself.

8. Further as seen from material on record, it is found that the opposite parties have ascertained about the employment of deceased from his employer on 1-8-2011, where as the complainant laid the claim immediately after the death of deceased and filed the present complaint on 6-7-2012. But the opposite parties have not informed about the claim to complainant until he applied under Right to Information Act under Ex.A2 and even then it is stated that the claim is under process. When the employer of deceased gave letter dt.1-8-2011, why the opposite parties kept quiet for such time for repudiation of claim is not explained by opposite parties. Moreover there is no whisper about the repudiation of claim by opposite parties in their version. They have filed the repudiation letter dt.9-8-2012 with chief affidavit and marked it as Ex.B1. All these things show the negligent attitude of opposite parties in settling the claim. As discussed supra, the opposite parties have not filed any piece of paper or terms and conditions regarding the subject policy. Hence, we hold deficiency in service on the part of opposite parties in not settling the claim of complainant. Accordingly this issue is answered in favour of complainant and against opposite parties.

Point No.2:

9. In view of the answer on point no.1, the complainant shall be entitled to insurance amount, interest and costs. The date of the claim is not known. Neither parties gives the date of claim. Interest may awarded after giving reasonable claim for verification of the insurance company. So interest is allowed from 1.10.2010 at a reasonable rate of 9% p.a.

10. In the result, the complaint is allowed partly and the opposite parties 1 and 2 jointly and severally are directed to pay an amount of Rs.6,25,000/- i.e. sum assured under subject policy to complainant with interest at 9% p.a. from 1.10.2010 till realization and costs of Rs.2,000/-. The opposite parties are directed to comply with the order within one month from the date of receiving copy of this order. The other claims of complainant if any shall be dismissed.

Type written by Steno N. Hazarathaiah, corrected by me and pronounced by us in the open Forum, this the 14th day of November, 2012.

PRESIDENT                                                                                                                           MEMBER

Appendix of evidence

Witnesses examined

On behalf of the complainant:                                                                                         On behalf of opposite parties:

Bazaru Bharat Kumar                                                                                                    The Legal Manager of 2nd OP,

(by affidavit) - PW-1                                                                                                             (by affidavit) - DW-1

Documents marked

On behalf of the complainant:

Ex.A1 Photocopy of insurance policy.

Ex.A2 24.05.2012 Original copy of letter issued by OP to the complainant.

Ex.A3 Photocopy of letter issued by complainant to OP.

Ex.A4 Photocopy of requisition form for death claim

Ex.A5 Photocopy of confidential report.

On behalf of opposite parties:

Ex.B1 01.08.2011 Photocopy of certificate.

Ex.B2 09.08.2012 Photocopy of letter issued by OP to the complainant.

PRESIDENT