Complaint filed on 14.05.2013  

                                                                                                                                       Compliant disposed on13.03.2015 

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM ::AT:: KARIMNAGAR, TELANGANA STATE

PRESENT: HON'BLE SRI B.SURESH, B.A., LL.M., Ist ADDL. DIST. &

SESSIONS JUDGE AND PRESIDENT (FAC)
AND

SRI G.SREENIVAS RAO, M.Sc.,B.Ed.,LL.B., PGADR (NALSAR), MEMBER

FRIDAY THE 13^TH DAY OF MARCH,

TWO THOUSAND FIFTEEN

CONSUMER COMPLAINT NO.60 OF 2013

Between:-

Illandula Narender @ Naresh, S/o.Pochaiah, Age: 25 years, Occ: Business, R/o.H.No.20-1-273/1, Ward No.9, Bus Stand Colony, Godavarikhani, Ramagundam Mandal Karimnagar District                                                                               …      Complainant

                                                                                              AND

1. Reliance Life Insurance Company Limited, Reliance House, 6^th Floor, No.6, Haddows Road, Nungambakkam, Chennai – 600006 R/by its General Manager.
2. Reliance Life Insurance Company Limited, Branch office, 1^st floor, 4-202 to 207, Old Medinova Complex, Bus Stand Road, Mancherial, Adilabad District 504 208 R/by its Manager.
3. Reliance Life Insurance Company Limited, Branch office, H.No.3-1-380, Kyasa Towers, Ambedkar Road, Upstairs of ICICI Bank, Karimnagar, R/by its Manager.

                                                                        ……   Opposite parties

This complaint is coming up before us for hearing on 05.11.2014, in the presence of Sri K.Rajaram Advocate for complainant, and Sri R.Santhosh Advocate for the opposite parties and on perusing the material papers on record and having stood over for consideration this day, the Forum passed the following.

                                                                                                   :: O R D E R ::

This complaint is filed Under Section 12 of CP Act to direct the opposite parties with joint and several liability to pay a sum of Rs.6,50,000/- together with the other benefits available under the policy and with interest @ 12% per annum from the date of death of the insured together with a sum of Rs.10,000/- towards mental agony and a sum of Rs.20,000/- towards compensation, in the interest of justice.

Brief facts of the Case

1.       a)       The mother of the complainant namely Illandula Laxmi Devamma had taken life insurance policy No.18495536 under Reliance Term Plan from the opposite parties on 02.02.2011 and the commencement of the policy was from 02.02.2011 and ending on 02.02.2026, by paying the premium amount of Rs.3,090-60 paise. The policy term is 15 years.

          The opposite parties have issued the policy in favour of the life assured and it is clearly mentioned that the age of the entry of life assured was 44 years and the age was verified. She died on 22.12.2011 at Government Hospital, Godavarikhani while the policy issued by the first opposite party was in force.

b)       As the complainant was the nominee he had filed ‘claim application’ to the opposite party no.1/company for payment of the sum assured Rs.6,50,000/- plus other benefits available under the said policy since the policy covers the risk. On the application of the complainant, the opposite party no.1 has issued a letter dt: 23.05.2012 repudiating the claim of the complainant on the ground that the policy holder had misstated her age. Whereas at the time of accepting the policy, the agents of the opposite parties have thoroughly verified the age of the life assured and having satisfied the requirements only. The opposite party issued the policy and the said fact is also clearly mentioned in the policy.

c)       The repudiation of the claim of the complainant is without any basis and not tenable as its not based on any material. Hence there is deficiency in service on the part of the opposite parties in repudiating the claim of the complainant and as such this Hon’ble Forum has got wide powers to entertain the matter for adjudication.

2.       a)       The opposite parties submitted that the complainant being the nominee of the Life Assured is trying to enforce a policy, which was obtained fraudulently by producing fabricated documents which is contrary to the terms and conditions of the policy.

b)       That the Life Assured, Late Smt.Illandula Laxmi Devamma, had obtained the insurance policy by grossly understating her age. The Life Assured, had availed the Reliance Term Plan policy bearing policy no.18495536 for a term of 15 years with an annual premium of Rs.3090/-. In which the sum assured was 6,50,000/- and the policy was issued on 02.02.2011. The Life Assured had stated her date of birth as 05.04.1966 in the application form and also submitted a school transfer certificate issued by Upper Primary School, Ponnaram in support of her age proof. The opposite parties had verified the age and issued the policy believing that the transfer certificate was genuine.

c)       Since the death of the Life Assured occurred on 22.12.2011 i.e. within two years from the date of issuance of the policy, the opposite parties had conducted a statutory investigation under clause 8(3) of the Insurance Regulatory and Development Authority (Protection of Policy Holders interest) Regulations, 2002. During investigation it was undisputedly proved that the Life Assured was aged about 74 years and the transfer certificate produced by her showing her age as 44 years is fake. The Head Master and the Record Assistant of the school confirmed that the details of such TC is not available in their records, so it is fake.

If the age of the Life Assured was correctly disclosed, the opposite parties would not have accepted the proposal to issue the policy assuming the risk associated with the policy. Further under the terms of the policy the permissible age limit at which the policy can be taken was 60 years only.

d)       The opposite parties have the right to call the policy in question and repudiate any claim under the policy U/s 45 of the Insurance Act within two years from the date of issuance of the policy.

e)       Further, under the terms and conditions of the policy, if Life Assured provided any inaccurate or false statement in the proposal, personal statement, declaration or related documents in connection with the policy, then policy shall become void and all claims to any benefit shall cease and all monies that have been paid by the policy holder shall belong to the company.

f)        It is further submitted that the Hon’ble Supreme Court in PC Chacko and Anr Vs.Chairman Life Insurance Corporation of India (2008) 1 SCC 321, observed that one of the most important principal of Life Insurance contract is Ubherrimafides i.e., ‘utmost good faith’ wherein every fact material to contract must be disclosed and the concealment of any material information or providing any false or incorrect information in the policy is a violation of the Insurance Contract. The policy has been cancelled and the claim has been repudiated in view of breach of the contract of insurance by the Life Assured and the opposite party prays that this Hon’ble Forum may be pleased to rely on the judgment of the Hon’ble Supreme Court in Export Credit Guarantee Corporation of India Ltd Vs. Garg sons International 2013 (1) SCALE 410, wherein it has been held that while construing the terms of the contract of insurance, the court must give paramount importance to the terms used in the said contract. Since there is a gross violation of the terms of the policy, the complaint is liable to be dismissed with compensatory cost to the opposite parties.

3.       The complainant filed evidence affidavit along with documents marked as exhibits from A1 to A7 whereas the opposite party filed exhibits from B1 to B8 along with proof affidavit, Heard both the counsels.

          Now the point for consideration is, whether the opposite parties are responsible for deficiency in service? If so, To what relief?

POINT

          The complainant’s mother during her life time obtained an insurance policy from the opposite parties on 02.02.2011 for a term plan of 15 years ending on 02.02.2026. The policy holder died on 22.12.2011. The complainant being the nominee sent claim from to opposite party no.1 company for payment of sum assured Rs.6.50 lakhs plus other benefits on the policy. The opposite party no.1 repudiated the claim through his letter Dt:23.05.2012 (Ex.A4) under the ground that the policy holder had misstated her age.

          The life assured had stated her date of birth as 05.04.1966 (Ex.B1), Since the death of the life assured occurred within 2 years of the insurance of policy i.e. approximately 10 months, the opposite parties conducted investigation (Ex.B3, B4 and B6) in which the opposite parties strongly relied on Ex.B3 which is the copy of the TC issued by a Government Upper Primary School, to the life assured duly signed by the then HM with official seal, along with attestation of the current HM with date as 09.03.2012 and also mentioned as “Records, concerned to this TC not available in our office”. As such it is a fake. So because of false statement made in the proposal, the opposite party had repudiated the claim and he also found his footing on the evidence under Ex.B6 (Sarpanch Statement etc). Whereas, the opposite party had failed to obtain an affidavit from the present HM who was working at the time of investigation to support his contention that the TC of the school was a false one. Since it is difficult to believe the endorsement (writing on the TC) is that of school authorities or some one else. In the absence of it, the benefit of doubt is given to the life assured only.

          The learned counsel for the complainant relied, on the judgment of Hon’ble A.P State Commission in FA 1246 of 2013, Dt: 21.03.2014 it was observed that

Para:9

“It is general practice that the agents of insurance companies approach the proposers for insurance with blank forms and obtain their signatures on dotted lines stating that they would take care of everything. In such an event, where the agent himself signs the proposal form or where the agent fills up the proposal form with untrue answers after the insured signs it and without his knowledge, the insured is not at fault and the policy is enforceable against the insurer”.

Para:11

It may be stated here that the estimations regarding age given by villagers can hardly be treated as cogent evidence of proof of actual date of birth. On the same ground, it is settled law that either the applications for obtaining ration cards or in that sense the ration card or the voters list cannot be treated as a conclusive proof of actual age mentioned therein of the person. The Insurance Company on such evidence could not come to the conclusion that the actual age of deceased at the time of taking the policy was incorrectly stated to be 45 years.

          Para:12

In those circumstances, we are of the view that the benefit shall always be given to the insured. In fact, the provisions of Consumer Protection Act also clearly indicate that principles of natural justice shall be followed.

          On perusal of the above, we are of the considered view that the Ex.B1 & Ex.B3 cannot be doubted at this stage and the endorsement on TC cannot be relied in the absence of affidavit to that effect by the HM of the school. So the point is answered in favour of the complainant.     

          In the result, the complaint is allowed and all the opposite parties are jointly & severally directed to pay the sum assured Rs.6.5 lakhs on the policy along with other benefits (if any) & interest @ 9% P.A from the date of death of insured till realization.

Typed to my dictation by Stenographer and after correction, the orders pronounced by us in the open court this the 13^th day of March, 2015.

                                      Sd/-                                                                                   Sd/-

                                  MEMBER                                                                    PRESIDENT (FAC)

NO ORAL EVIDENCE HAS BEEN ADDUCED ON EITHER SIDE

FOR COMPLAINANT:                       

1. Ex.A1 is the photo copy of Reliance Life Insurance Policy Schedule issued by opposite party Dt: 02.02.2011 (in favour of the Deceased Illandula Laxmi Devamma).
2. Ex.A2 is the photo copy of Out Patient chit issued by Civil Assistant Surgeon, APVVP, Godavarikhani, Dt: 22.12.2011. (with age mentioned as 46 years)  
3. Ex.A3 is the photo copy of Death Certificate of Illandula Laxmi Devamma issued by Municipality of Ramagundam, Dt: 31.01.2012. (DOD 22.12.2011).
4. Ex.A4 is the photo copy of Letter addressed to complainant issued by the opposite party no.1, Dt: 23.05.2012. (repudiation of claim)
5. Ex.A5 is the photo copy of Pan Card of deceased Illandula Laxmi Devamma. (with DOB 05.04.1966)
6. Ex.A6 is the photo copy of Study, Conduct and Date of Birth Certificate of Complainant, Dt: 12.06.1993. (showing DOB 09.04.1986)
7. Ex.A7 is the photo copy of Identity Card of complainant issued by Election Commission of India.

FOR OPPOSITE PARTY:

1. Ex.B1 is the photo copy of Policy document of deceased Illandula Laxmi Devamma issued by opposite party no.2, Dt: 31.01.2011.   (5 sheets)
2. Ex.B2 is the photo copy of Claim Form-A of complainant Dt: 15.02.2012 and Form-C Certificate of identify for Illandula Laxmi Devamma, Dt: 15.02.2012. (4 sheets)
3. Ex.B3 is the photo copy of Transfer Certificate of Nerella Laxmi Devamma issued by Head Master of Govt.UPS, Ponnaram, Adilabad District. (DOB 05.04.1966) (2 sheets).
4. Ex.B4 is the photo copy of Full Investigation Report on deceased Illandula Laxmi Devamma, Dt: 13.03.2012. (12 sheets)
5. Ex.B5 is the photo copy of Ration Card containing the name of deceased Illandula Laxmi Devamma.
6. Ex.B6 is the photo copy of nativity declaration of Illandula Laxmi Devamma issued by Ex-Sarpanch of Kothapally (H), Dt: 08.03.2012.
7. Ex.B7 is the photo copy of Reliance Term Plan issued by the opposite parties. (showing benefits of policy & FAQ in 4 sheets)
8. Ex.B8 claim repudiation Dt: 23.05.2012 along with affidavit of investigation agency and original booklet of policy document (copy of Ex.B1).

                                           Sd/-                                                                                     Sd/-

                                        MEMBER                                                                    PRESIDENT(FAC)