Punjab

Rupnagar

CC/14/112

Ranjit Kaur & Ors. - Complainant(s)

Versus

Life Insurance corporation of India - Opp.Party(s)

Ms. Suchi Sharma,Adv

24 Mar 2015

ORDER

BEFORE THE DISTT. CONSUMER DISPUTES REDRESSAL FORUM, ROPAR

 

Consumer Complaint No.: 112 of 09.09.2014

                                      Decided on                          : 24.03.2015

 

1. Smt. Ranjit Kaur, aged about 41 years, widow of Late Sh. Karamjit

    Singh, son of Sh. Tega Singh, resident of Village Dhespura, P.O.

    Chamkaur Sahib, Distt. Ropar.

2. Harsimranjit Singh, aged about 22 years, son of Sh. Karamjit Singh,

    son of Sh. Tega Singh, resident of Village Dhespura, P.O. Chamkaur

    Sahib, Distt. Ropar.

3. Harbabaljit Kaur, wife of Satnam Singh resident of village Bathan

    Khurd, Tehsil Khamanon, Distt. Fatehgarh Sahib.

 

                                                                                      ....Complainants

 

                                                  Versus

 

Life Insurance Corporation of India, Rupnagar, Tehsil & Distt. Rupnagar through its Branch Manager.    

                                                                                                                                                                                                ....Opposite Party

 

                            

 

QUORUM

                             MRS. NEENA SANDHU, PRESIDENT

                             SH.V.K. KHANNA, MEMBER

SMT. SHAVINDER KAUR, MEMBER

 

ARGUED BY

                             Ms. Suchi Sharma Advocate, counsel for

                             the complainants

Sh. H.C. Verma Advocate, counsel for Opposite Party

 

ORDER

          MRS. NEENA SANDHU, PRESIDENT

          Smt. Ranjit Kaur & others have filed this complaint under Section 12 of the Consumer Protection Act, 1986 (hereinafter referred to as ‘the Act’ only) against the Opposite Party (hereinafter referred to as ‘the O.P.’ only) praying that the O.P. be directed to settle the claim and pay the sum assured on account of death of Sh. Karamjit Singh, alongwith litigation costs.

 

2.                In brief, the case of the complainants is that Smt. Ranjit Kaur, complainant No.1, being the widow, Sh. Harsimranjit Singh, complainant No.2, being the son and Smt.  Harbabaljit Kaur, complainant No.2,  being the daughter of Late Sh. Karamjit Singh, are his legal heirs. On 15.10.2003, said Sh. Karamjit Singh had purchased one money back insurance policy bearing No.162444282 for the sum assured of Rs. One lac from the O.P., which was to be matured in the month of October, 2023 i.e. after a period of 20 years. The half-yearly premium payable under the said policy was Rs.3292/- and said Sh. Karamjit Singh had been paying the said premium amount, regularly, who unfortunately, died on 15.9.2013. At the time of his death, no premium amount was due against the said policy. The O.P. had credited an amount of Rs.20,000/- on 29.9.2008 and Rs.20,000/- on 15.10.2013 in account of said Sh. Karamjit Singh, the Deceased Life Assured (hereinafter referred to as ‘the DLA’ only). As per the terms & conditions of the policy the O.P. is liable to pay the sum assured to the legal heirs of the DLA, accordingly, the claim was lodged by the complainants with the O.P., but it refused to pay the same, for the reasons best known to it, which amounts to deficiency in service. Hence, this complaint.

 

3.                On being put to notice, the O.P. filed written statement in the shape of affidavit of Smt. Hem Lata, Manager (Legal) resisting the complaint taking preliminary objections; that the complainant has no locus standi to file the complaint against the O.P., which is not maintainable and is liable to be dismissed; that this Forum has no jurisdiction to entertain and try the complaint and the same is liable to be dismissed; that there is no deficiency in service on the part of the O.P. and that the complainant has no cause of action against the O.P. On merits, it is admitted that the DLA, namely, Karamjit Singh, had died on 15.9.2013, who had purchased the money back insurance policy in question and the complainant No.1 is his widow and also nominee under the said policy. It is stated that the premiums under the policy were payable half-yearly i.e. in the months of April & October, every year, but the DLA did not pay the same regularly. The premium due for October, 2005 was paid three months late. The premiums due for April, 2006 & October, 2006 were paid on 22.11.2006. The premium due for April, 2008 was paid in July,2008. The premium due for October, 2008 was paid in January,2009. The premiums due for April, 2009 & October, 2009 were paid on 15.2.2010. The premiums due for October, 2010, April, 2011 & October, 2011 were paid on 14.2.2012, therefore, the policy remained in lapsed condition due to non-payment of premium for October, 2010 and the same was revived on the basis of personal statement regarding declaration of good health, on 14.2.2012. It is admitted that an amount of Rs.20,000/- was paid on 23.9.2008 towards the survival benefit vide cheque dated 15.10.2008. Although the DLA had died on 15.9.2013, yet another survival benefit amount of Rs.20,000/-, which was due to be paid on 15.10.2013, was paid vide cheque dated 15.10.2013 on 7.10.2013, for the reason that the complainants had informed about his death late, to the O.P. In the Personal Statement furnished by the DLA, at the time of revival of the policy, he had given answers to the questions as under:-

          QUESTION                                                                            ANSWER

Q. No. 2      Since the date of your proposal for the                                  

                   above mentioned policy ;

          a)       have you ever suffered form any illness,              No

disease requiring treatment for a week

or more?    

 

Q. No. 4      Are you at present in sound health?                    Yes

         

 

                   The above said answers given by the DLA have been found to be false as the O.P. had indisputable evidence to show that prior to the date of revival, the assured had suffered from alcoholism cirrhosis as he was having liver problem and had taken treatment from PGI, Chandigarh. The investigator had submitted the treatment record of PGI, Chandigarh and has concluded that the case may be decided, accordingly. As per Out Patient card of PGI, Chandigarh, the said patient (DLA) was taking treatment since 5.9.2011 vide C. No. 201103701574 for alcoholism cirrhosis. As per form No.3816 obtained from PGI, Chandigarh, the patient (DLA) was admitted on 11.9.2013 with ALD CLD PHTN HE III, sever malaria, x 2 days and the diagnosis and history of illness is reported as alcoholic liver disease, portal hypertension, hepatic encephalopathy III Malaria x 2 days. The DLA had, thus, made deliberate mis-statement and withheld the material information from the O.P. regarding his health at the time of revival of the policy. Consequently, as per the terms of the policy contracts, declaration signed at the foot of the said personal statement & the declaration of good health form, the revival of the policy was declared null & void, all monies paid towards revival of the policy belongs to the O.P. and the death claim under the policy was settled for paid-up value only with first unpaid premium as 15.10.2010. It is stated that the survival benefits were paid before receipt of intimation regarding death of the DLA. If the O.P. had intimation about his death, the payment of survival benefit due on 15.10.2013 would not have been made, because the same was to be paid only, if the life assured was surviving on the date falling due of the said survival benefit. If the cheque for the said amount was received, after the death of the DLA, the same should have been returned to the O.P. by the complainants un-encashed, but the same was got encashed on 15.11.2013 i.e. one month after his death, to which the complainants were not entitled to, as the death had occurred earlier, therefore the said amount of Rs.20,000/- was deducted from the total claim amount of Rs.42,500/- and a net amount of Rs.22,500/- was paid to the nominee, Smt. Ranjit Kaur, complainant, on 3.7.2014, through her bank account No.14002011020179, maintained with OBC, Chamkaur Sahib. The claim has been duly paid as per the terms & conditions of the policy and there is no deficiency in service on the part of the O.P. All other allegations made in the complaint have been denied and a prayer has been made for dismissal of the same with costs.

 

4.                On being called upon to do so, the learned counsel for the complainant tendered affidavit of complainant, Smt. Ranjit Kaur, Ex.C1, affidavit of complainant, Sh. Harsimranjit Singh, Ex.C2, besides documents Ex. C3 to C8 and closed the evidence. On the other hand, the learned counsel for O.P. tendered affidavit of Smt. Hem Lata, Manager (Legal), Ex. OP-1, photocopies of documents Ex. OP-2 & OP-11, Ex. OP-10(A) and also examined Sh. Sukhjit Singh, Medical Record Technician, PGIMER, Chandigarh, and thereafter, closed the evidence.

 

5.                 We have heard the learned counsel for the parties and gone through the record on the file, carefully.

 

6.                The first question for consideration before us is as to whether the DLA had concealed the material facts relating to his health at the time of revival of the policy in question.

 

7.                At the outset, the learned counsel for the O.P. vehemently argued that the said policy was got revived by the DLA by concealing the material facts, same is evident from the Out Patient Card of PGI and from the Certificate of Hospital Treatment (Ex. OP10-A). Since the DLA got revived the policy by concealing the material facts about his health, the O.P. has already settled the claim under the policy by paying the paid-up value to the nominee, Smt. Ranjit Kaur, complainant No.1, thus, the O.P. is not deficient in rendering service.

 

8.                To this effect, the learned counsel for the complainant submitted that in order to prove this fact that the DLA had got revived the policy by concealing the material facts about his health, has placed reliance on the Out Patient Card of PGI, but the O.P. has not placed on record the said Out Patient Card. Even in the Certificate of Hospital Treatment, Ex. OP-10A, it has been mentioned that the DLA was admitted in PGI on 11.9.2013 and his history of illness has mentioned as alcoholic, chronic liver disease, portal hypertension, hepatic encephalopathy, but in the said certificate, it is not mentioned that for how long, he was suffering from the above said diseases and from where and for how long he had taken the treatment, if any, for the said diseases. On the basis of this certificate, it cannot be concluded that at the time of revival of the policy in question, the DLA was actually suffering from the said diseases and was taking treatment for the same and he had deliberately concealed the said fact in the Personal Statement furnished before the O.P. at that time. The O.P. has, thus, illegally withheld the claim amount due under the policy, which amounts to deficiency in service, therefore, it be directed to pay the entire claim amount, due under the policy(Ex.OP-3) i.e. the sum assured + vested bonus.

 

9.                We find force in the submission of the learned counsel for the complainant, because to prove the fact that the DLA was taking treatment for the above said diseases from the PGI since 5.9.2011, i.e. prior to the revival of the policy in question, the O.P. has not placed on record the said Out Patient Card of PGI. Even Sh. Sukhjit Singh, Medical Record Technician, PGIMER, Chandigarh, who was examined by the O.P. had also nowhere stated in his examination or cross-examination, that the DLA ever remained admitted in the PGI prior to 11.9.2013.  Nodoubt, in the Certificate of Hospital Treatment, Ex. OP10-A, issued by the  PGIMER, Chandigarh, it is mentioned that Karamjeet Singh (DLA)  was admitted there on 11.9.2013, and in the column No. 6, it is found mentioned that he was alcoholic & was suffering from chronic liver disease and in the column –History of illness as per records (case summary), it is categorically mentioned that the deceased life assured was alcoholic and was suffering from chronic liver disease, portal hypertension, hepatic encephalopathy, but in the said certificate it is nowhere mentioned that since how long and from whom, he had taken treatment for the said diseases. Therefore, merely on the basis of the Certificate of Hospital Treatment, Ex. OP10-A, it cannot be concluded that the DLA was actually suffering from the above said diseases, prior to revival of the policy on 14.2.2012, or that he was well aware about the same and had deliberately suppressed the material information relating to his health in the Personal Statement produced by him before the O.P. on the said date.  Thus, the O.P. has withheld the claim amount due under the policy illegally, which amounts to deficiency in service on its part. In the case of ‘Satwant Kaur Sandhu vs. New India Assurance Company Ltd.’ IV (2009) CPJ 8(SC), the Hon’ble Supreme Court has held that the contract of insurance is based on utmost good faith on the part of the assured, and an assured is under a solemn obligation to make a true and full disclosure of the information on the subject, which is within his knowledge. 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. The obligation to disclose necessarily depends upon the knowledge one possesses.

 

10.               The next question that falls for consideration before us is as to whether all the complainants are entitled to get the claim amount due under the policy? From the perusal of copy of policy document, Ex. OP3, it is evident that Smt. Ranjit Kaur, complainant No.1, was declared as nominee by the life assured. Therefore, she, being nominee, is entitled to get the entire claim amount, as per the terms & conditions of the policy, and not the complainants No. 2 & 3 and consequently, the complaint filed by the complainants No. 2 & 3 is liable to be dismissed, being not maintainable. It may be stated that while paying the claim amount to Smt. Ranjit Kaur, complainant No.1, the O.P. may deduct the amount, which has already been paid to her.

 

11.              In view of the aforesaid discussion, the complaint filed by the complainants No. 2 & 3 is dismissed and the same, so far as it filed by complainant No.1 is concerned, is accepted  and the O.P. is directed to pay the sum assured + vested bonus, as per the policy, to Smt. Ranjit Kaur, the complainant No. 1, after deducting the amount already paid to her, alongwith interest @ 9% P.A. w.e.f. the date of filing of the complaint i.e. 09.09.2014 till realization and also to pay a sum of Rs.3000/- as litigation expenses, within 45 days from the date of receipt of certified copy of this order.  

                   The certified copies of this order be supplied to the parties forthwith, free of costs, as permissible under the rules and the file be indexed and consigned to the Record Room.

 

ANNOUNCED                                                                       (NEENA SANDHU)

Dated 24.03.2015                                        PRESIDENT

 

 

(V.K. KHANNA)                    (SHAVINDER KAUR)

                    MEMBER                                MEMBER.