BEFORE THE DISTRICT FORUM:KURNOOL
Present: Sri.S. Chinnaiah,B.A.,B.L.,I/C President
And
Smt. C.Preethi, M.A.LL.B., Lady Member
Friday the 29th day of February, 2008
C.C.No. 123/07
Between
Md. Azharuddin, S/o. S. Ameeruddin, aged about 21 years, Muslim, Student ,
R/o. H.No.10/95, Babu Gounda Street, Near Masoom Basha Darga, Kurnool. … Complainant
Versus
Life Insurance Corporation of India, Represented by its Senior Divisional Manager, Divisional Office,
Jeevan Prakash, College Road, Kadapah. … Opposite party
This C.C coming on before us for final hearing on 21-02-2008, Sir.Syed Shafaqath Hussain, Advocate Kurnool for the complainant and of Sri.A.S.U.Javid Ali, Advocate , Kurnool for the opposite party and having stood over consideration till this day, this forum delivered the following.
ORDER
(Sri. S.Chinnaiah, I/C President)
C.C.No.123/07
1. This is a complaint filed under section 12 of C.P. Act, 1986 by the complainant to direct the opposite party to pay the insurance amount of Rs.1,00,000/- to the complainant with interest thereon at 24% p.a. from the date of death of the insured and further direct the opposite party to pay a compensation of Rs.25,000/- towards mental agony she has suffered on account of deficiency of service and also to pay the costs of the complaint.
2. The contents of the complaint in brief are that the complainant Md. Azharuddin is the son of S. Rehana Begum (herein after referred to as deceased). Her mother is no more. She died on 14-03-2006 at Govt. General Hospital, Kurnool. During her life time on the basis of the proposal from dated 30-3-2005 the mother of the complainant has insured with the Branch Office of OP company, Kurnool which comes under Kadapa Division and the risk of her life was accepted and the first premium-cum-acceptance letter was issued to her by the opposite party company. Subsequently a policy bearing No.653575938 was also issued to her by the opposite party, Kurnool Branch Office covering the risk of her life from 28-03-2005 and the date of maturity of the said policy is 28-03-2020 and as per the said policy the sum assured is Rs.1,00,000/-. It was further stated the deceased was admitted the Govt., General Hospital, Kurnool on 11-03-2006 as she suddenly fell unconscious. She was treated in the said hospital and finally on 14-03-2006 she died. The cause of her death as disclosed by the doctors was hypertension with coma. Prior to 11-03-2006 she was hale and healthy and had no complaint. After her death as the complainant is the nominee as per the policy issued by the opposite party, the complainant preferred a claim for the insurance amount with the opposite party company. But surprisingly the complainant received a letter dated 20-03-2007 from the opposite party’s office informing the complainant that the opposite party has decided to repudiate all liability under the said policy on the ground that the deceased had withheld correct information regarding her health at the time of effecting assurance with the opposite party company and that it has an evidence and reasons to believe that the life assured had taken treatment for DM with Hypertension with Metabolic Coma prior to the date of commencement of the policy. It is further stated that in fact at the time effecting assurance with the opposite party, the deceased was hale and healthy living normal and healthy life and attending to her duties and daily chores like any other person and was not suffering from any disease. The allegation in the letter of the opposite party that the deceased had taken treatment for DM with Hypertension with coma prior to the date of commencement of policy is absolutely false and baseless. Repudiation of claim on the ground that the opposite party company have some evidence and reasons to believe that she had taken treatment for DM with Hypertension with coma prior to the date of commencement of policy, without disclosing the source of such information in this regard is most unjust, illegal and amounts to deficiency of service. After receiving letter from the opposite party dated 20-03-2007, the complainant and his sister
S. Amera Begum, who is a nominee under another policy and who had also send a similar letter from the opposite party’s office sent their representations to the Zonal Manager of the opposite party company on 28-04-2007 by courier service requesting him to reconsider their claims, but the Zonal Manager of the opposite party did not respond. Hence they are forced to file this complaint before this forum. Thus the case of the complainant.
The opposite party filed a counter resisting the contents of the complainant contending that it is a fact that the deceased life assured was submitted the proposal dated 30-03-2005 to Branch Office, Kurnool seeking insurance on her own life for a sum assured of Rs.1,00,000/- under plan and term 14-15 and opted to pay the premia under quarterly mode. It is further submitted that the deceased life assured S. Rehana Begum had nominated her son i.e., Md. Azharuddin under section 39 of Insurance Act 1938. She declared herself to be quite healthy as per her statements and replies to question Nos.11(a) to (j) and signed the declaration at the foot of the said proposal, all her said statements regarding health as also other particulars, form the basis of the contract of insurance and agreed therein that if any untrue averments were to be found in her statements, the contract of insurance shall be absolutely null and avoid and that all the moneys and in respect thereof shall stand forfeited to the corporation. Accordingly basing on her statements and declaration, the risk on her life was accepted and policy was issued with 28-03-2005 date of commencement and that plan and term 14-15 for a sum assured Rs.1,00,000/- under quarterly mode with premium of Rs.1,814/- as sought by the deceased life assured. The deceased life assured declared herself to be quite healthy, as per her answers to the question No.11 in the proposal dated 30-03-2005 and answered negatively all the questions as regards her health and that she did not suffer for nay illness or ailments and was not hospitalized. The nominee who is the complainant herein informed that the life assured expired on 14-03-2006 and preferred the claim. As the death claim arose within 2 years form the date of commencement of the policy, the claim was treated as an early claim and investigation was conducted. During investigation, it was revealed that the deceased life assured was admitted in Govt., General Hospital, Kurnool on 11-03-2006 and died on 14-03-2006. She was diagnosed as Diabetic with Hypertension with Metabolic Coma. As per I.P.No.9125 dated 11-03-2006 the deceased life assured was known diabetic for 12 years and also known Hypertensive for 5 years and was taking insulin for 35 units/dose three times a day. It is further stated that the deceased life assured had not disclosed the details of the sickness prior to proposal, in the proposal submitted for insurance. The deceased life assured had answered questions 11 (a), (b) ,(d) , and (e) enquiring about her health in the negative and stated that her usual state of health has been “Good” in answer No.11(i). The declaration signed by the deceased life assured at the bottom of the proposal makes the contract null and void in event of withholding of any information or giving untrue information. The deceased had suppressed the material information about her state of ill health before the date of proposal. Had the deceased life assured disclosed the true and correct information in the proposal, it would have affected the decision of the underwriter. Hence the contract has become null and void and all the moneys paid to the corporation shall stand forfeited to the corporation as per the declaration and policy condition No.5. It is further submitted that the contract of insurance is a contract of utmost good faith and the deceased life assured misled the insurer by suppressing the material facts about her illness in her proposal. As such the policy was called in question under section 45 of Insurance Act, 1938 and the contract is declared as void abinitio. It is further submitted that all allegations leveled against the opposite party corporation are baseless and false. It is not true to say that the deceased life a assured had never taken any treatment for the alleged said disease and she was not knowing about this and that she had not suppressed the disease at the time of taking the above policy. It is further submitted that it is clear that the deceased life assured was suppressed the material fact of her ill health knowingly and obtained the insurance policy with a malafide intention. The opposite party further stated that in terms of the declaration executed by the deceased life assured and the untrue statements made by her in the proposal the contract was declared
null and avoid by speaking order dated 30-03-2005. The speaking order of the opposite party addressed to the complainant through their registered letter dated 20-03-2007 giving her the address of their appellate authority and advised her to make an appeal is she is not satisfied with the decision of the opposite party. The opposite party states that the repudiation of the policy contract was made on justifiable grounds after due application of mind, basing on the evidences available and the repudiation is strictly according to the terms and conditions of contract. It is false to state that the complainant made a representation before appellate authority of the opposite party i.e. to the Zonal Office, Hyderabad for reconsideration of the claim amount. Hence to dismiss the complaint with costs.
3.Heard arguments both sides.
4.The point that arises for consideration herein is: whether the complainant proved the deficiency of service on the part of the opposite party?.
5 Exs. A-1 to A-3 are marked for the complainant and Exs.B-1 to B-5 for the opposite party.
6. Ex.A-1 is the death certificate of the deceased Rehana Begum that she died on 14-03-2006. Ex.A-2 is the repudiation letter of the opposite party stating deceased has withheld material information regarding her health. Ex.A-3 is the office copy of legal notice issued by the complainant to the opposite party dated 02-07-2007 along with postal receipt and served acknowledgement.
7. Ex.B-1 is the original proposal dated 30-03-2005, Ex.B-2 is the original policy bond bearing No.653575938 of the deceased life assured, Ex.B-3 Extracted case sheet from Govt., General Hospital, Kurnool in IP.No.9125 dated 11-03-2006 of the deceased life assured, Ex.B-4 is claim form B submitted by Dr. G. Bhavani Prasad, Civil Asst. Surgeon, GGH, Kurnool, Ex.B-5 is the claim form B1 submitted by Dr. G. Bhavani Prasad, Civil Asst. Surgeon, GGH, Kurnool.
8. We have gone through the contents of the complaint, counter, chief affidavit and counter affidavit of the opposite party, documents filed herein and the relevant material available on record.
9. The complainant Md. Azharuddin is the son of the deceased Rehana Begum. She died on 14-03-2006 as seen under Ex.A-1 death certificate. During the life time of Rehana Begum, she submitted proposal form dated 30-03-2005 under Ex.B-1 to insure her life with the opposite party. A policy under Ex.B2 was issued. Thus the risk of her life was commenced under Ex.B-2 from 28-03-2005 for a sum assured of Rs.1,00,000/- The deceased was admitted in Govt., General Hospital, Kurnool, on 11-03-2006 as she was suddenly fell unconscious and that she was treated in the said hospital and finally she died on 14-03-2006 due to hypertension with coma. The case of the complainant is prior to 11-03-2006 the deceased was hale and healthy and has no complaint in any manner. Thus the complainant who is the son of the deceased claims that his mother died due to hypertension with coma as disclosed by the doctors. The deceased while taking the policy under Ex.B2 has nominated the complainant as nominee.
10. On the other hand, the opposite party admitting the case of the complainant regarding taking the policy by the deceased under Ex.B-2 and that she died on 14-03-2006. The deceased during her life time has assured her life for a sum of Rs.1,00,000/- under Ex.B-2 policy with a premium of Rs.1,814/- as sought by the deceased under quarterly mode of premium.
11. The contention of the opposite party is as per the records available with them they find that the deceased life assured was suffering from diabetic with hypertension with metabolic coma. As per General Hospital, Kurnool IP.No.1925 dated 11-03-2006, the deceased was a known diabetic for 12 years and also known hypertension for 5 years and was taking insulin of 35 units/dose three times a day. They have extracted the particulars of the case sheet by them since the hospital authorities have refused to furnish the same. Their next contention is, it is incorrect to state that the deceased had never taken any treatment for the alleged disease and she was not aware of the disease and had not suppressed the material information with regard to her ill health prior to the date of proposal dated 30-03-2005 under Ex.B-1. She did not however disclose these facts in her proposal dated 30-03-2005 gave false answers in the proposal Ex.B-1. In terms of declaration signed by the deceased at the bottom of the proposal the contract became null and void because of withholding of correct information with regard to her health. Hence the claim under the policy Ex.B2 was repudiated dated 20-3-2007 under Ex.A-2 and all amounts paid were forfeited and no amount what so ever is payable towards the policy contract. Thus the staunch contention of the opposite party is that the deceased was known diabetic and suffering with hypertension even prior to was known diabetic and suffering with hypertension even prior to Ex-B1 proposal. The claim of the complainant was repudiated and as such there is no any deficiency of service on the part of the opposite party.
12. After going through the rival contentions, we have to necessarily reject the contention of the opposite party. It is to be stated, it is no doubt true that the opposite party have collected Exs. B-4 and B-5 dated 28-6-2006 of medical attendance certificate and certificate of hospital treatment relating to the deceased Rehana Begum who underwent treatment in Govt., General Hospital, Kurnool. On admitting in the said hospital as in patient on 11-03-2006 and that she died on 14-3-2006. Exs.B-4 and B-5 are issued by one Dr.Bhavani Prasad on 28-6-2006. It is no doubt true that the said doctor who issued Exs.B-4 and B-5 stated that the deceased was diabetic patient for 12 years and hypertension for 5 years. Basing under Exs.B-4 & B5 it is contended by the opposite party that the deceased has suppressed the material information with regard to her ill health prior to the date of proposal dated 30-03-2005. They also filed Ex.B-3 extracted case sheet from the Govt. General Hospital, Kurnool relating to the treatment of the deceased. Ex.B-3 shows that the deceased died on 14-03-2006. It is no doubt true in Ex.B-3 it is observed known patient of DM for 12 years on insulin 35 units/dose for three times a day. Hypertension for 5 years. It is to be stated that the doctors who issued Exs.B-3. B-4 and B-5 have not filed their affidavits in order to show that the deceased was a known patient of diabetic for 12 years and hypertension for 5 years prior to her taking policy on 30-03-2005. They have issued Exs. B-4 and B-5 on 28-6-2006. The opposite party has not filed any affidavit or adduced any evidence in order to establish the fact of the health condition of the decease as mentioned in Exs.B-3, B-4, and B-5 that she was diabetic patient of 12 years and was taking insulin of 35 units/dose three times a day and suffering with hypertension for 5 years. Hence, under the circumstances, it is very difficult to place reliance on Exs. B-3, B-4 and B-5.
13. It is to be stated that the complainant is not hiding the fact as the deceased died due to hypertension with coma. It is no doubt true that the deceased was examined by the panel doctor of the opposite party as seen under Ex.B-1 and the said doctor satisfied with the answers given by the deceased and recorded the same. It is to be remember that it is the duty of the panel doctor to take care for doing tests to find out to the ailment of the insured while testing. In the present case, it is not known what are the steps taken by the panel doctors. But, however, the panel doctor has satisfied to the answers given by deceased at the time of Ex.B-1 proposal form dated
30-03-2005. At this juncture, it is relevant to go through a decision reported in II 2004 CPJ Page 452 Delhi State Consumer Disputes Redressal Commission, New Delhi (LIC of India Vs. Sudha Jain).
In the above cited decision it is held that:
“Life Insurance- Suppression of material facts – claim repudiated on ground of suppression of fact that deceased was diabetic – Forum allowed complaint – Hence appeal by OP _ Maladies like diabetes, hypertensions being normal wear and tear of life, cannot be termed as concealment of pre-existing disease – Insured not bound to disclose diseases easily detectable by basic tests like blood test, ECG – If at time of policy, deceased suffering from disease likely to cause death shortly, doctors on panel of OP would have detected easily – No suppression of material facts – Orders of Forum upheld”.
In a reported decision I 2007 CPJ Page 275 (NC) National Consumer Disputes Redressal commission, New Delhi, (LIC of India Vs. Tejalben Kananbhai Patel) their Lordships held that:
“Life Insurance – Suppression of material facts alleged – Life assured hospitalized for 5 days for fever, throat pain etc. – Death, eight months later due to massive heart attack – claim repudiated – suppression of common cold/fever not at all relevant – No suppression of material facts – Insurer liable”.
In a decision reported in II ( 2005) CPJ 9 (NC) ) (Life Insurance Corporation of India Vs. Badri Nageswaramma and others) it was held that:
“The company is liable under the policy, since no exclusive evidence produced to suggest suppression on part of deceased, because the burden to prove false representations and suppression of facts on the insurer and the doctor certificate, without affidavit in support, is no basis for repudiating the claim”.
The same proposition is laid down in a decision reported in IV (2005) CPJ 205 (A.P) (Life Insurance Corporation of India and Others Vs. Mora Rajeswarai).
14 Hence by virtue of the observation of their Lordships in the above cited decisions, in the present case it is not known what are the steps taken by the panel doctors. On the other hand, the panel doctor had satisfied with the answers given by the deceased at the time of Ex.B-1 proposal form. The complainant issued legal notice, under Ex.A-3 to the opposite party demanding to pay the amount under Ex.B-2 policy bond, being the nominee of the deceased. But the opposite party issued a repudiation letter Ex.A-2 stating the deceased had withheld material information regarding her health.
15. considering the circumstances of the case, we are satisfied that there is every deficiency of service on the part of the opposite party for not settling the claim. The complainant is entitled for the amount under the policy bond Ex.B-1 as claimed by her. The complainant is claiming interest on the insurance amount of Rs.1,00,00/- with interest at 24% p.a. In our considered opinion, the interest at 24% p.a is on higher side. We are inclined to award interest at 9% p.a. from the date of death of the deceased i.e., 14-03-2006 till date of payment. The complainant is claiming Rs.25,000/- towards compensation, as interest is awarded on the insured amount, we are not inclined to award any amount towards compensation.
16. In the result, the complaint is partly allowed directing the opposite party liable to pay to the complainant a sum of Rs.1,00,000/- under the policy bearing No.653575938 with interest at 9% p.a from 14-03-2006 till the date of payment and also pay Rs.1,000/- towards costs of the complaint. This order shall be complied with, within one month form the date of receipt of this order.
Typed to dictation, corrected and pronounced by us in the open Forum on this the 29TH day of February 2008.
Sd/- Sd/-
MERMBER I/C PRESIDENT
Appendix of evidence
Witness examined
For Complainant: For Opposite parties:
-Nil- -Nil
Documents marked
For the Complainant:
Ex.A-1. Death Certificate.
Ex.A-2. Repudiation letter.
Ex.A-3. Office copy of legal notice, dt.05-07-2007.
For the opposite parties:
Ex.B-1 Original proposal form dt:30-03-2005.
Ex.B-2. Original policy bond bearing No.653575938.
Ex.B3. Extracted case sheet from Govt., Hospital, Kurnool.
Ex.B4. Clam Form B submitted by Dr. G. Bhavani Prasad,
Civil Asst., Surgeon, GGH. Kurnool.
Ex.B5. Claim form B1 submitted by Dr. G. Bhavani Prasad,
Civil Asst., Surgeon, GGH. Kurnool.
By the Forum: Sd/-
-Nil- I/C PRESIDENT
Copy to :-
1.Sri. Syed. Shafaqath Hussain, Advocate, Kurnool for the complainant.
2. Sri. A.S.U. Javid Ali, Advocate, Kurnool for the opposite party.
Copy was made ready on :
Copy was dispatched on:
Copy was delivered to parties:
