BEFORE THE A.P. STATE CONSUMER DISPUTES REDRESSAL COMMISSION

AT HYDERABAD.

F.A. 241/2008 against C.C.  2/2006,   Dist.. Forum, Warangal    

Between:

1. L.I.C. of India

Rep. by its Branch Manager

Branch Office at Mahabubabad

Mahabubabad, Warangal Dist.         

2.  L.I.C. of India

Rep. by its Branch Manager

Branch Office at Sathupally

3. L.I.C. of India

Rep. by its Divisional  Manager

Divisional  Office at P.B. No. 17

Jeevan Prakash, Balasamudram

Hanamkonda, Warangal Dist.                     ***                         Appellants/

                                                                                                Ops 1 to 3.   

.                                                                  And

Tirumala Hymavathi

W/o. Late Ramakrishna Reddy

Age: 38 years,  R/o. Bayyaram

Khamma Dist.

Now at H.No. 4-7-98

Kumarpaly, Hanamkonda

Warangal Dist.                                            ***                         Respondent/       

                                                                                                Complainant. 

Counsel for the Appellants:                         M/s. A. V. Satyanarayana Rao

Counsel for the Resps:                                M/s. Bankatlal Mandhani.  

CORAM:

                         HON’BLE SRI JUSTICE D. APPA RAO, PRESIDENT     

                                                             &

  SMT. M. SHREESHA, MEMBER

MONDAY, THIS THE SECOND DAY OF AUGUST TWO THOUSAND TEN

Oral Order: (Per Hon’ble Justice D. Appa Rao, President)

                                                          *****

1)                This is an appeal preferred by the  insurance company against the order of the Dist. Forum directing to pay Rs. 11 lakhs with interest @ 7.5% p.a. together with  costs of Rs. 5,000/-. 

2)                The case of the complainant in brief is that  her husband took two polices  one for Rs. 5 lakhs  commencing from 28.1.2002 and another policy for Rs. 50,000/-  commencing from 28.3.2002 covered with triple accident benefit.    She was the nominee under both policies.   While so on 28.12.2002 when her  husband was going from Byyaram to Hanumakonda he suffered heart attack.  He was shifted to Mamata nursing home, Wardhannapet and died on the same day due to cardiac arrest.   When claims were made the insurance company repudiated  it on the ground that the deceased died due to kidney failure and the said fact was suppressed.   Therefore she filed the complaint to grant Rs. 10 lakhs under first policy and Rs. 1.50 lakhs under the second policy with interest @ 18% p.a., together with compensation and costs.

3)                The appellant insurance company resisted the case.  While admitting issuance of policies it alleged when the claims were made since the death of the deceased occurred within three years from the date of issuance of policies an enquiry was conducted and they found that the assured had suppressed his ailment suffering from kidney disease, and he also suppressed the fact that he had taken earlier a policy for Rs. 5 lakhs.   He went on leave due to ill-health right from 1999 up till his death.  He had suppressed the same while submitting the proposal forms.   Therefore it prayed for dismissal of the complaint with costs. 

4)                The complainant in proof of her case filed her affidavit evidence and got Exs. A1to A12 marked, while the appellants filed the affidavit evidence of its Administrative Officer Sri K. Mangapathi Rao and got Exs. B1 to B7 marked. 

5)                The Dist. Forum after considering the evidence placed on record opined that the appellant could not prove that the assured was suffering from kidneys ailment prior to taking of the policy.   At any rate he having died of heart attack an accidental death and therefore entitled to the benefits under the policies and directed it to pay Rs.  11 lakhs with interest @ 7.5% p.a., from the date of filing of complaint viz.  27.7.2005 till the date of deposit together with costs of  Rs. 5,000/-.

6)                Aggrieved by the said decision, the appellant insurance company preferred the appeal contending that the  Dist. Forum did not appreciate either  facts  or law in correct perspective.  It ought to have seen that  first policy  ‘Jeevan Sree’ covers in case of death  a consolidated  amount of Rs. 5 lakhs  and the policy was issued without accident benefit, and the second policy issued for  payment of a consolidated amount of Rs. 1,50,000/- in case of natural death.   Therefore it was liable to pay  Rs. 5 lakhs and Rs. 1,50,000/- respectively  and not Rs. 11 lakhs  as was awarded.    In fact the assured had suppressed his ailment.   Since the death was due to heart attack, it cannot be  considered as accidental death.  Granting double benefit  on both policies is totally incorrect.    While taking second policy the assured had suppressed taking of first policy for Rs. 5 lakhs.  Therefore the complainant was not entitled to any amount ordered in this regard. 

7)                The point that arises for consideration is whether the order of the Dist. Forum is vitiated by mis-appreciation of fact or law?

8)                It is an undisputed fact that  the husband of the complainant  late  Tirumala Ramakrishna Reddy  had taken a policy for  sum assured  Rs. 5 lakhs commencing from 28.1.2002 to  28.1.2022.  The very policy  Jeevan Shree reads that  nominee  is entitled to a consolidated amount of Rs. 5 lakhs  if the assured dies  during the currency of the policy.  In regard to second policy  Jeevan Mitra (Triple Cover Endowment Plan) with profits  (with accidental benefit)  sum assured was Rs. 50,000/- commencing from  28.3.2002 to 28.2.2017.    The policy stipulates that “ provided the policy is in force the full sum assured in the event of the life assured’s death prior to the date of maturity an additional amount  equal to twice  the sum assured specified in the schedule  to the policy shall be payable to the proposer   or the assignee or nominees or legal representative.”     A reading of the above policy would undoubtedly show that  the insurance company  was liable to pay Rs. 5 lakhs.  While in regard to second policy it was liable to pay  Rs. 1.50 lakhs  in case of death during the subsistence of the policy.    No doubt  the first policy is without any accidental benefit.   He is not entitled to twice the amount of sum assured under the first policy.   What all she was entitled to is Rs. 5 lakhs.  When the policy stipulates that  it is without accidental benefit, the complainant could  not have claimed Rs. 10 lakhs  nor  the Dist. Forum  granted  Rs. 10 lahs  under the first policy   In fact  Ex. A3 certificate filed by the complainant  shows that he died of cardiac arrest.  The medical officer had categorically stated that the death was due to  cardiac  arrest. 

9)                Recently the National Commission in  SBI Life Insurance  Company  Ltd. Vs.  Y. Dayamani  reported in III (2010) CPJ 1 (NC)    opined that the death due to heart attack in normal course  is not an accidental death.     By no stretch of imagination  death due to heart attack  could be construed as death by accident.   Therefore, awarding   Rs. 10  lakhs  under the first policy is patently  unjust and illegal.    

10)              Coming to the second policy, amount assured was Rs. 50,000/-.  It is  Jeevan Mitra  Medical (Triple cover endowment plan) with profits  (with accident benefit).  It is mentioned under  the clause  ‘special provisions’ 

“ provided the policy is in force the full sum assured in the event of the life assured’s death prior to the date of maturity an additional amount  equal to twice  the sum assured specified in the schedule  to the policy shall be payable to the proposer   or the assignee or nominees or legal representative.”    

                                                                                      (emphasis supplied)

Therefore, the complainant would be entitled to Rs. 1,50,000/-  in view of  death of the assured.  In fact an amount of Rs. 6,50,000/-  that was deposited by the appellants  was withdrawn by the complainant in FAIA No.  1624/2008  on  16.7.2008 and as such entire claim was satisfied.    The complainant is not entitled to Rs. 11 lakhs  as was granted by the Dist. Forum. 

11)              The contention of the appellants  is that the  assured had suppressed his ailment and therefore  is not entitled to the amount.    It may be stated herein that  Ex. A1 policy for Rs. 50,000/- was taken on  28.3.2002.  On the policy it was mentioned as ‘MEDICAL’.    The insurance company obviously did not accept the proposal submitted by the assured by taking the facts mentioned in it   as ex-faice true.  He  got him examined by  Dr. I. Ramesh Chandra,   a panel doctor  vide Ex. B2 and issued the policy.   In the light of the fact that the deceased  died within two years, undoubtedly, an enquiry was conducted.  They sought the leave particulars  of the deceased/assured  who worked as police constable from the police department wherein it was mentioned that he  had  applied commuted leave  and earned leave.    Evidently he never availed any medical leave stating that he was suffering from  any ailment vide Ex. B3.    The earned leave  and commuted leave  applied  would in no way be construed as  leave due to his sickness.    They have obtained  a certificate   Ex. B4 from Asst. Sub-Inspector of Police, Vemsoor P.S. Sathupally Circle of Khammam District   wherein he stated that the “assured had reported sick from 9.1.2002 to 17.2.2002  due to kidney problem and again from 24.12.2002 to till death 28.12.2002 due to body pains, burning sensation and chest pain etc. as per records.   This is a vague certificate to state that the deceased  in fact was suffering from those ailments, and therefore he had suppressed them.    An investigator ought to have  verified from the doctors  as to  know  the  exact  ailment  from  which  the  deceased   had  suffered.    

Apart from  it  there is no nexus  between the above said ailments  with heart attack from which  he had suffered.    When there is no satisfactory  evidence let in by the insurance company,  we  have to hold that  he did not suppress his health condition  and on the other hand the insurance company  got him examined by a panel doctor and after satisfying  with his health condition and then got the policy  issued. 

12)               The Hon’ble Supreme Court in  L.I.C. of India Vs. Smt. Asha Goel  reported in AIR 2001 SC 549   opined that  “repudiation of claim  by insurer merely  on grounds that deceased had with-held  correct information regarding his health  at time of effecting  insurance with corporation is  not proper.    It should not be dealt with  in a mechanical  and routine manner but should be  one of extreme care and caution.”

The insurance company could not prove that he suppressed the  ailment.  The deceased died of heart attack, we are of the opinion that an amount of Rs. 5 lakhs under the first policy and Rs. 1,50,000/- under the second policy  had to be paid which in fact was paid.    The Dist. Forum went wrong in  assuming that the first policy was  with attendant  benefits wherein she was entitled to twice the amount assured.    What all she was entitled to is a consolidated sum of Rs. 5 lakhs .  In regard to second policy she was entitled to thrice the amount namely Rs. 1,50,000/-. 

13)               In the result the appeal is allowed in part, modifying the order of the Dist. Forum.  Consequently the insurance company is directed to  pay Rs. 6,50,000/-  which the complainant had received  in FAIA No. 1624/2008  dt. 16.7.2008.  Considering the circumstances, there shall be no order as to costs. 

1)      _______________________________

PRESIDENT                 

2)      ________________________________

 MEMBER           

   Dt.  02. 08.   2010.

*pnr

“UP LOAD – O.K.”