Haryana

Charkhi Dadri

CC/07/2021

Sunil - Complainant(s)

Versus

Manager, HDFC Life Insurance Company Ltd, - Opp.Party(s)

Sh. Manjeet Chahar

24 Sep 2024

ORDER

Before the District Consumer Disputes Redressal Commission, Charkhi Dadri.

 

                                                                        Complaint No.   7 of 2021.

                                                                        Instituted on:     06.01.2021.

                                                                        Date of decision:24.09.2024.

Sunil wife of Mukhtyar Singh, aged about 45 years and permanent resident of village and post office Ghasola, Tehsil and District Charkhi Dadri.

………Complainant.

                        Versus

 

1. Manager, HDFC Life Insurance Company Limited, C/o HDFC Bank branch Rohtak Road, Charkhi Dadri, District Charkhi Dadri.
2. MD/CEO, HDFC Life Insurance Company Ltd. Registered office Lodha Excelus, 13^th Floor, Apollo Mills Compound, NM Joshi Marg, Mahalaxmi, Mumbai-400011

 

………Respondents.

 

                        COMPLAINT UNDER THE

                        CONSUMER PROTECTION ACT,

 

Sitting:            Hon’ble Shri Manjit Singh Naryal, President,

                        Hon’ble Shri Dharam Pal Rauhilla, Member,

 

Present:           Shri Manjeet Chahar, Adv. for complainant.

                        Shri Pawan Kumar, Adv. for the OPs.

ORDER

 

            The case of the complainant, in brief, is that Mukhtyar Singh husband of the complainant had obtained an insurance policy bearing No.21991354 and paid Rs.50,000/- to OP no.1 towards 1^st premium on 11.11.2019.  It is pertinent to mention here that proposal for insurance was accepted by OPs after through check up of health and habits of life assured in person through their medical officer and after fully satisfied the insurance policy was issued. Under the terms and conditions of the policy, OPs fixed Rs.50,000/- as yearly premium payable  for 7 years, maturity period 10 years, sum assured Rs. 2,24,829/-. As per part C of terms and conditions of the insurance policy, OP also undertook to provide death benefits equivalent to “sum assured for 10 times to the annualized premium or 105% of the premium paid till the date of death whichever is highest”. The complainant further alleged that husband of complainant developed chest pain and some minor illness as such he was admitted in Paras Hospital Gurugram and died on 11.12.2019. After the death of life assured the complainant had lodged claim with the respondents after completion of required documents but her claim was repudiated on false grounds. The complainant further alleged that due to the act and conduct of the respondents, she had to suffer mental agony, physical harassment and financial losses. Hence, it amounts to deficiency in service on the part of respondents and as such, she had to file the present complaint.

2.                     The opposite parties filed reply denying the averments and contentions in the complaint, except those, which are expressly adverted to and admitted herein. The complaint is false, malicious and is an attempt to avail undue advantage, hence liable to be dismissed. That the Deceased Life Assured (DLA) has suppressed the material facts with respect to his medical history and if he would have disclosed the facts at the time of application, the said policy would not have been issued at all to the DLA.

                        The OPs further averred that the claim of the complainant was rightly rejected by the opposite party for reason of fraudulent, misrepresentation and non-disclosure of material facts by the DLA at the time of enrolment of the policy. The Supreme Court of India in the case of Satwant Kaur Sandhu vs New India Assurance Company Ltd has referred the term “Proposal Form” as defined under the Insurance Regulatory and Development Authority, 2002 as a  “Form” to be filled in by the proposer for insurance, for furnishing all material information required by the insurer to decide whether to accept or decline, to undertake risk, and in the event of acceptance of the risk, to determine the rates, terms and conditions of a cover to be granted and any fact which would influence the mind of a prudent insurer in deciding whether to accept or not to accept the risk is “material fact”.

                        The complainant has no locus standi to claim as the insurance policy was obtained by DLA by mis-representation of material facts in order to defraud the opposite party. The medical history deliberately/ knowingly withheld by DLA at the time affixing his signature on the enrolment form. That the Division bench of Hon’ble Andhra Pradesh High Court in LIC of India vs B. Chandravathamma reiterated that, the proposal, the personal statement and the life insurance policy all contain a special clause putting the insured on notice that in case of any such deliberate misrepresentation, the contract of insurance would become void and the amounts paid there under shall be forfeited. The misrepresentation, therefore, is fraudulent and deliberate and is with respect to a material particular.

                        The contract of insurance is a contract of ‘Uberrimae fide’ i.e an act of utmost good faith and as such if any violation and breach of the terms and conditions, then no benefit can be sought under the said policy. The deceased has made the said breach as such the complainant is not entitled to relief and the complainant manipulated the entire set of incidents in order to get the claim amount. That after understanding all the terms and conditions of the HDFC Life Classic Plus Plan, Sh. Mukhtyar Singh had submitted the duly filled and signed member form cum health declaration form and further agreed that if any statement is untrue or inaccurate or if any of the material was not disclosed, the opposite party may void the contract subject to the provisions of the Section 45 of the Insurance Act, 1938 as amended from time to time.

            As per proposal form the life insured deceased vide colum no. 2&4 of the personal details of life assured  had declared that he was not suffering from any disease whatsoever and all the questions were answered in negative. The questions pertaining  to previous symptoms and medical conditions  were answered as NO in section Health Declaration of Member Form filled in and signed at the time of taking insurance.

That relying upon the declarations made by the deceased in the member form no tests were conducted and believing the information in the member form to be true and correct, the opposite party issued the Policy bearing No. 21991354. All the terms and conditions of the policy were well explained to the DLA and the same were mentioned in the Certificate of Insurance which are binding on the policy holder. That the opposite party received a death claim intimation from the complainant being the nominee of DLA informing that DLA had expired on 11.12.2019 along with death certificates and other documents. It was revealed that the DLA was suffering from “Coronary Artery Angiography with Percutaneous Transluminal Coronary Angioplasty”  at the time of making the proposal  for the life insurance policy. That concealment and suppression of medical history amounted to suppression of material facts and hence the contract of insurance (policy) is liable to be rescinded as per section 45 of the Insurance Act, 2015 as amended from time to time and no benefit is payable. In catena of cases the Hon’ble Apex Court and Hon’ble NCDRC categorically and consistently held in various cases that, insured is bound to disclose material information in the proposal form and terms of contract of insurance, the court must give paramount importance to the terms used in the said contract. The suppression and concealment of medical history was a material fact and had it been disclosed correctly, the said policy would not have been issued at all. The opposite party rejected the claim of the complainant due to non-disclosure of material information at the time of issuance of the membership under the subject policy and same was communicated to the complainant vide letter dated 31.03.2020 and also refunded the premium amount of Rs. 47,847/- in favour of the complainant and credited in the account. The repudiation of claim is in accordance with the terms of the policy contract and principle of Insurance Law. Hence, in view of the facts and circumstances mentioned above, there is no deficiency in service on the part of respondent and the complaint of the complainant is liable to be dismissed.

3.                     The counsel for the complainant in support of his case has filed affidavit Ex.CW1/A and tendered the documents Ex.C1 to Ex.C7 and evidence of the complainant was closed on 08.06.2022.

4.                     On the other hand, the learned  counsel for the OP has filed the affidavit Ex.RW1/A of Shri Gurpreet Singh, Manager, Legal HDFC Standard Life Insurance co. Ltd. and tendered document Ex.R1 to Ex.R11 and evidence of the OP was closed on 21.03.2023. The OPs have submitted various citation of Hon’ble Supreme Court viz

1. Sulbha Prakash Motegaonkar  and ors Vs. Life Insurance Corporation of India, Civil Appeal No.8245 of 2015, decided on 05.10.2015 (SC)
2. Manmohan Nanda Vs. United India Insurance Co. Ltd, Civil Appeal No. 8386 of 2015, decided on  06.12.2021 (SC)

In the light of these citations the counsel of the OP has argued to dismiss the complaint on the ground of concealment of pre-existing disease.

5.                     We have heard the arguments advanced by learned counsel for both the parties.  All the documents have been perused very carefully and minutely.

6.                     It is an admitted fact that the deceased Mukhtyar Singh had submitted proposal form (Ex. R2) and on receiving requisite premium of Rs. 50,000/-, the opposite parties issued HDFC Life Classic Assure Plus Plan receipt and policy No. 21991354 to the deceased Mukhtyar Singh  and the complainant is the nominee of the policy.

                        That Shri Mukhtyar Singh passed away on 11.12.2019 due to cardic arrest. The complainant approached company for settlement of insurance claim along with requisite documents being a nominee of the policy, with a request to settle the claim at the earliest. The opposite party on receiving claim application had an investigation of the claim through an agency and INSIDE TRACK SERVICES agency submitted its report (Ex. R4).

                        The opposite parties repudiated claim on 31.03.2020 (Ex. R11) stating that life assured was suffering from Coronary Artery Angiography with Percutaneous Transluminal Coronary Angioplasty, prior to his proposal for insurance and it is clear that the Life Assured has given false and misleading information to the company. It is evident that the company has been led to issue the policy by suppression of material facts regarding his/her past medical history. In the said circumstances, repudiating the claim for non-disclosure of material information at the time making the proposal the premium of Rs. 47,847/- received from the DLA was remitted in the account of the complainant.

7.                     We have carefully perused entire medical record placed by the opposite party under Ex. R4 &Ex. R5. Ex.R4  is a report of M/s  inside Track Services engaged by the OP wherein it has been mentioned that it was a case of pre existing disease as per records of Paras Hospital. However, Ex.R5 is a death summary recorded on death of the DLA on 11.12.2019, wherein there is no mention about any pre-existing disease and cause of death has been mentioned as Cardiogenic Shock, Recurrent VT and Cardio Respiratory Arrest.

                        In terms of death summary prepared by the Paras Hospital, Gurgaon, the cause of death of the DLA is Cardiogenic Shock, Recurrent VT and Cardio Respiratory Arrest and it has no connection with any pre-existing disease. Hence, the claimant is entitled for insurance claim equivalent to 10 times of the annualized premium in terms of terms and conditions of the policy (Annexure G). The relevant terms mentioned under Part C (2) Death benefit is reproduced below:-

2. Death Benefit:- on death of the Life Assured before the maturity date and provided all premiums which have fallen due are paid, the amount payable in the sum of :

• Sum assured or 10 times the annualized premium of 105% of the premium paid till the date of death, whichever is highest:
• Accrued simple reversionary bonuses
• Interim Bonus (if any)
• Terminal Bonus (if any)

The annual premium is Rs.50,000/- as per Ex.C2. Accordingly, an amount of Rs.5,00,000/- (i.e. 10 times of annual premium of Rs.50,000/-) is become admissibleto the complainant.

8.                     In the result, the complaint is “ALLOWED” by directing the opposite party No. 1 & 2 jointly and severally to:

1. To pay insured amount of Rs.5,00,000/- after deducting the premium of Rs. 47,847/- remitted to the complainant alongwith interest @6% p.a. from 31.03.2020 the date of repudiation letter till final payment
2. To pay an amount of Rs.5,000/- (Rupees Five thousand)  for rendering deficient services, for causing mental agony and harassment.
3. To pay Rs. 5,000/- as litigation expenses.

            The above order be complied within 45 days from the date of this order failing which further interest @9% will be paid by the OPs  for the delayed period.  Certified copies of the order be sent to the parties free of costs.  File be consigned to the record room, after due compliance.