BEFORE THE DISTRICT CONSUMER DISPUTES

REDRESSAL COMMISSION, JALANDHAR.

Complaint No.73 of  2018

      Date of Instt. 20.02.2018

      Date of Decision: 02.09.2022

Sanjay Sehgal aged 49 years S/o Late Shri Kuldip Raj Sehgal, R/O Flat No.47, HIG Flats, Mall Mandi, Panj Peer, Amritsar.

..........Complainant

Versus

1.       Life Insurance Corporation of India, Divisional Office, ‘Jeevan          Parkash’ Model Town Road, Jalandhar-144001 Through its          Senior Divisional Manager.

2.       Life Insurance Corporation of India, Branch Office, Unit No.4,         Ground Floor, “Jeevan Parkash” Building, Model Town Road,   Jalandhar City-144001 Through its Branch Manager.

….….. Opposite Parties

Complaint Under the Consumer Protection Act.

Before:        Dr. Harveen Bhardwaj             (President)

                   Smt. Jyotsna                            (Member)

                   Sh. Jaswant Singh Dhillon       (Member)                                

Present:       Smt. Harleen Kaur, Adv. Counsel for the Complainant.

                   Sh. S. C. Sood, Adv. Counsel for OPs.

Order

Dr. HarveenBhardwaj (President)

1.                The instant complaint has been filed by the complainant, wherein it is alleged that the complainant is the husband of Kanchan Sehgal, who whilst alive had taken LIC’s Jeevan Anand Policy on her life under Table No.149 for terms 21 years for Rs.5,00,000/- sum assured with Accident Benefit. The policy number is 133666219 with date of commencement 15.04.2013 and maturity date 15.04.2033. The mode of premium installment yearly. The yearly installment of premium was fixed at Rs.28,587/-. The life assured was Deputy Manager in State Bank of India government bank by profession and was hale and hearty at the time of insurance and did not suffer from any disease and her health profile was good. She was doing her professional work and domestic responsibility. The life assured had good health, insurability within no trace of any physical impairment at the time of proposing for insurance. The OP No.2 after scrutiny and verifying particulars of proposal form, also obtained Agent’s Confidential Report/Moral Hazard from securing agent and Development Officer and after fully satisfying as to health and habits, physical condition and insurability and age of the life assured evaluated and underwritten proposal with Proposal Review Prescribed Format for acceptance of risk. Thereafter underwriter recorded its decision on Proposal Review Slip as Standard life and accepted risk at ordinary, without raising any kind of objection as to the details given in proposal and personal statement and in all these reports collected premium at the tabular rate of premium as Standard Life and accepted risk of life insurance without any demur. All these reports with OP No.2 would reveal that there was no adverse feature found of the life of life assured regarding health profile and age, occupation and the life assured could not be found fault with for non-disclosure at the time of proposing for life insurance policy and acceptance of risk later on. The life assured was hale and hearty, kept good health, led simple normal active healthy life by participating in day to day activities in her service in State Bank of India as Manager. The life assured was not harboring and laboring under any disease or sickness when she sought insurance on her life under the policy in question. The life assured was insurance minded fully conscious to the need for life insurance risk and saving. The life assured was no stranger to opposite parties since DLA had also taken life insurance policies. To misfortune and ill luck of the complainant the life assured died on 01/10/2015. The cause of death was CARCCENOMA Breast. The policy was alive on the date of death. The life assured was young lady of 44 years at the time of death. It was natural Death. Subsequent to the death of the life assured, the complainant being nominee lodged death claim of the policy in question with OP No. 2 being Policy Servicing Branch Office for paying Basic Claim i.e. Sum Assured with benefits attached to the policy. The complainant submitted to OPs through OP No.2, the following documents as asked for.

a) Death Claim intimation-cum Claimant's Statement Claim Form (A) dated 15.9.2011.

b) Form No.3785 Claim Form C (Revised), Certificate of Identity and Burrier or cremation.

c) Death Certificate.

d) Original Policy Bond.

                   That claim so made covered by both policies has been repudiated by letter and conveyed vide letter dated 30.09.2016 by registered post by OP No.1. The claim had been repudiated after expiry of period of two years from the date the policy was effected. Refusal to pay rightful and genuine claim by OP No.1 is arbitrary, wrongful, malafide and perverse. The OPs is guilty of deficiency in rendering service and negligence and as such necessity arose to file the present complaint with the prayer that the complaint of the complainant may be accepted and OPs be directed to pay death claim of the Policy No.133666219 subject matter of complaint for Rs.5,00,000/- total sum assured with vested bonus as per terms and conditions of the policy with interest @ 12% per annum on claim amount from the date of death upto the date of actual payment to the complainant. Further, OPs be directed to pay a compensation of Rs.50,000/- for causing mental tension and harassment to the complainant and Rs.10,000/- as litigation expenses.

2.                Notice of the complaint was given to the OPs, who filed its joint written reply and contested the complaint by taking preliminary objections that the complaint is stopped to file the present complaint by his own act, conduct and acquiescence. The deceased Kanchan concealed the material facts at the time of taking the policy and complainant is not entitled to claim any amount. The complainant supplied Form No.3816, 3584 duly verified by the Doctor of the Hospital, where she got treatment and also supplied Form No.3787 attested by employer, Chief Manager, State Bank of India, Amritsar, showing medical leave. It is further averred that the contract between the life assured and the OP is contract of good faith. The life assured did not disclose her ailment and about her accident and the life assured also did not disclose that she has taken medical leave prior to taking the policy, as such the contract is not valid contact and the life assured obtained the policy while suppressing the true facts, so the present complaint is to be dismissed on this ground. On merits, the factum with regard to taking /purchasing the policy by the deceased life assured is admitted and it is also admitted that the life assured was an office in State Bank of India, but the other allegations as made in the complaint are categorically denied and lastly submitted that the complaint of the complainant is without merits, the same may be dismissed.

3.                In order to prove the case of the complainant, the counsel for the complainant tendered into evidence affidavits Ex.CA, Ex.CB and Ex.CC alongwith some documents Ex.C-1 to Ex.C-7 and closed the evidence.

4.                In order to rebut the evidence of the complainant, the counsel for the OPs No.1 and 2 tendered into evidence affidavits Ex.OPW1/A and Ex.OPW1/B alongwith some documents Ex.O-1 to Ex.O-14 and closed the evidence.

5.                We have heard the learned counsel for the respective parties and have also gone through the case file as well as written arguments submitted by counsel for the OPs very minutely.

6.                It is admitted that the deceased had taken LIC Jeevan Anand Policy and her life was assured with accident benefits. It is also admitted that the life assured was an officer in State Bank of India. It is also admitted that the complainant provided the proposal form, but it has been denied that the wife of the complainant was hale and hearty at the time of insurance and was not suffering from any disease. It has been alleged that the complainant has concealed the material facts about her health from the OP. The complainant has alleged that the deceased i.e. his wife died on 01.10.2015 with the disease of Carcinoma Breast and the complainant lodged the death claim of the policy, which was repudiated after expiry of two years, wrongly. Ex.C-1 is the repudiation letter.

7.                The OPs, on the other hand, have alleged that at the time of filling the proposal form, the deceased was on medical leave from 15.03.2013 to 17.05.2013 for the treatment of fracture forearm in a road traffic accident and was discharged on 18.03.2013. On this ground, the claim of the complainant was repudiated rightly.

8.                The complainant has proved on record the copy of death intimation letter Ex.C-2, copy of death certificate Ex.C-5. The OPs have proved on record the medical record of the deceased Ex.O-3, Ex.O-5, Ex.O-9 to Ex.O-11 and the certificates issued by the State Bank of India Ex.O-6, Ex.O-7 and Ex.O-12. It is also admitted and proved that the deceased was insured with the date of commencement 15.04.2013 and the maturity date was 15.04.2033. The wife of the complainant died on 01.10.2015. Ex.O-2 is the discharge summary of Mrs. Kanchan Sehgal. Perusal of the same shows that she was admitted on 02.07.2013 and discharged on 04.07.2013. Perusal of this document shows that she was diagnosed with the Carcinoma Breast. Ex.O-3 is the Cytology Report, which shows that she was advised Trucut Biopsy or Immediate Lumpectomy to rule out malignancy. This clearly shows that for the first time on 24.06.2013 when the F.N.A.C. of the deceased was done, lump was found in the left breast of the deceased and she was admitted in the hospital thereafter. The present policy commenced on 15.04.2013 and on 15.04.2013, she was not suffering with any such problem and there is no report or document to show that on 15.04.2013 she was having any such problem. Ex.O-4 shows that in the column of history, it has been mentioned that she was treated for carcinoma breast in the year 2013. She had swelling over sternum for which biopsy was taken in June, 2015 and the report showed it to be sarcoma probably radiation induced and she was treated for chemotherapy, but did not respond. Perusal of Ex.O-5 also shows that date when such disease was observed is July, 2013. Ex.O-6 and Ex.O-7 are the documents showing when did she last attend duties. Though these documents show the leaves taken by the deceased from 2011 to 2013, but in both the documents nothing has been mentioned that she has taken any medical leave rather she had taken privilege leave. From 15.06.2012 to 28.06.2012 she took the leave for vaccination of the children and from 15.03.2013 to 15.04.2013 i.e. during the validity of the insurance policy, for due to fracture forearm left. Ex.O-9 shows that she was admitted in Amandeep Hospital on 15.03.2013 due to the injury on forearm. Ex.O-10 is the certificate regarding her admission in Amandeep Hospital and she was advised rest from 18.03.2013 to 17.04.2013. Ex.O-11 is certificate in which she was advised rest from 18.04.2013 to 17.05.2013 as she was admitted and diagnosed with fracture forearm. Ex.O-12 is the certificate from the bank of the complainant to show that she remained on medical leave from 17.12.2013 to 01.02.2014, 18.05.2015 to 13.06.2015 and 12.08.2015 to 01.10.2015. As per Ex.O-8, the proposal form was filled on 25.04.2013 and the policy commenced on 15.04.2013. On 25.04.2013, as per Ex.O-12 she was not on medical leave. So, the period shown in the Ex.O-12 does not cover the period when the insurance was purchased. Ex.O-13 is the repudiation letter, vide which the claim of the complainant was repudiated on the ground that she remained admitted in the hospital upto 18.03.2013 and thereafter she remained on medical leave upto 17.05.2013. It has been alleged that she was on medical leave for 15 days, but she has not disclosed it, is the reason for repudiating the claim. It has been alleged that she has not disclosed about the actual state of her health. As discussed above, she suffered fracture of forearm and this was not such a chronic problem which could not be treated. The remaining period from June, 2013 onward, when she remained on leave was after the obtaining of the insurance and the problem she suffered was sudden and was not in her prior knowledge. Therefore, it cannot be said that she has concealed material facts from the insurance company.

9.                The law referred by the Ld. Counsel for the OPs, titled as “Satwant Kaur Sandhu Vs. New India Assurance Company Ltd.”, 2009 (4) R.C.R. (Civil) 692 is not applicable to the facts of the present case as the fracture in the forearm is not such a fact which would influence the judgment of a prudent insurer in fixing insurer the premium or determining whether to accept the risk or not. The fracture of forearm is not a terminal problem. The law referred by the Ld. Counsel for the OP, titled as “Life Insurance Corporation of India Vs. Manish Gupta”, 2019 (3) 195 PLR 620 (SC), is not applicable to the facts of the present case as in that case the past history of cardiovascular disease was not disclosed by the respondent which would definitely influence the judgment of a prudent insurer in fixing insurer the premium or determining whether to accept the risk or not and may cause the death of insured, but in the present case, there was no such problem at the time of obtaining the insurance. It has not been alleged anywhere by the OPs that the ailment i.e. fracture of forearm of the wife of the complainant i.e. the deceased was a life threatening disease which could or did cause the death of the insured. It has been held by Hon’ble Punjab State Consumer Disputes Redressal Commission in a First Appeal No.634 of 2007, decided on 19.02.2008, titled as “Life Insurance Corporation of India Vs. Satinder Kaur”, that concealment of material fact or wrong answer must have direct bearing/nexus with ultimate cause of death, but in the present case the reason on the basis of which the claim of the complainant has been repudiated has no nexus with the ultimate cause of death, the deceased did not die of fracture in forearm rather she died of breast cancer due to non-responding to chemotherapy. So, therefore, the repudiation letter is illegal and wrong and the same is hereby set-aside and thus, the complainant is entitled for the relief.

10.              In view of the above detailed discussion, the complaint of the complainant is partly allowed and OPs are directed to pay the death claim of Rs.5,00,000/- to the complainant with interest @ 6% per annum from the date of death till realization. Further, the OPs are directed to pay a compensation of Rs.10,000/- for causing mental tension and harassment to the complainant and Rs.5000/- as litigation expenses. The entire compliance be made within 45 days from the date of receipt of the copy of order. This complaint could not be decided within stipulated time frame due to rush of work.

11.              Copies of the order be supplied to the parties free of cost, as per Rules. File be indexed and consigned to the record room.

Dated          Jaswant Singh Dhillon    Jyotsna               Dr. Harveen Bhardwaj     

02.09.2022         Member                          Member           President