IN THE CONSUMER DISPUTES REDRESSAL FORUM, KOTTAYAM
Dated this the 25th day of April 2023
Present: Sri.Manulal.V.S, President
Smt.Bindhu.R, Member
Sri.K.M.Anto, Member
CC No. 33/2021 (Filed on 08.02.2021)
Complainant : Thomas Joseph, Thevalassery
Kurisummoodu P.O
Changanachery -686104
(By Adv.Mathew Philip)
Vs
Opposite parties :1. M/s Exide Life Insurance Company Ltd
Having its registered office at
3rd floor, JP Techno Park
No.3/1, Millers Road, Bengaluru-560001
2. The Insurance Ombudsman
2nd Floor, Pulinat Building,
Opp.Cochin Shipyard, M.G.Road
Ernakulam -682 015
3. M/s Muthoot Finance Ltd
Represented by its Branch Manager
Kurisummoodu Branch
Changanassery-686 104.
(By Adv.Shamon Shaji)
O R D E R
Smt.Bindhu.R, Member
The Complaint is filed under section 35 of the Consumer Protection Act 2019.
The complainant has taken a life insurance policy by name ‘Exide Life Assured + LP Plan” with the opposite party. He being the policy owner and his wife shiny Sebastian the life assured for a period of 10 years. The previous payment period was five years and the policy period was 10 years. Complainant had paid first two annual installments of premium on 17.03.2018 and 18.04.19 respectively. While so on 27.10.19 the wife of the complainant, the insured, expired due to Coronary Artery Disease as per the hospital records. She died on the way to the hospital and hence postmortem was done and FIR was lodged by the Changanassery Police Station. After the incident the complainant submitted a claim before the opposite party and submitted all the documents required by them. But on 03.03.2020 the complainant received a letter from the opposite party repudiating his claim on the ground that non disclosure of pre-existing medical condition. It is stated that the insurer had procured certain in disputable proof. Confirming the pre-existing medical condition of the deceased which was not disclosed at the time of issuance policy. According to the letter the complainant approached the complaints officer, but for no result. The opposite party was in their earlier stand. Thereafter the complainant approached the insurance ombudsman and submitted the real facts of the treatment along with additional documents. But on 28.09.2020 the complaint was dismissed by stating that the treatment records clearly showed that the life assured had been visiting the hospital since Nov.2016.
Medical certificate from Udayagiri Multi Specialty Hospital which was obtained by the complainant clearly stated that the deceased visited the hospital three times only that to since 06.11.2018. The complainant obtained copy of the medical records produced by the opposite party. But it is not a reliable document. The total amount due under the policy is Rs.9,56,930/-. The first opposite party vide its letter dated 03.03.2020 refunded an amount of Rs.1,91,386.72/- being the admissible part of premium paid already. The balance amount due is Rs.7,65,543/-. Hence the complaint is filed for quashing the repudiation letter dated 03.03.2020 and 12.03.2020 and the award dated 28.09.2020 of the 2nd opposite party and direct the 1st opposite party to pay Rs.7,65,543/- along with interest, compensation and cost.
Upon notice the 1st opposite party appeared and filed version.
Due to non-appearance of 2nd and 3rd opposite parties, they were set ex-parte. The 1st opposite party has contended that the compliant is baseless and abuse of process of law. Since the policy has been obtained by the life assured by suppressing the past medical history of diabetes mellitus and hypertension diagnosed and treated since 2016. The policy entered into 2018 is invalid and void –ab-initio. The contract of insurance is based on utmost good faith. The said intentional non- disclosure of the material facts goes to the route of the matter vitiating the subject policy and rendered it invalid and unenforceable. In issuing the policy the company has relie on , and may relied on, accuracy and completeness of information provided by the proposer of life assured and any other declaration or statements made by the policyholder/ life assured. In case of fraud or misrepresentation the policy shall be cancelled immediately by paying the surrender value subject to s.45 of the Insurance Act. The insurance company conducted an investigation and it was revealed that the diseased has suppressed her past medical history of diabetes mellitus and hypertension diagnosed and treated prior to submitting the proposal form. The life assured replied the health related question in negative despite being aware about the medical conditions. The deceased life assured had not entered into the contract of insurance with good faith which is one of the primary requisites of insurance contract and had failed to disclose the true and correct information specifically to the question no.75 A asked regarding diabetes mellitus and hypertension. Had the said medial history disclosed, the said policy could not have been issued to the deceased life assured. So there is no deficiency of service or unfair trade practice on the part of the 1st opposite party as repudiation of the claim by the complainant is fair and reasonable. Hence the complaint is liable to dismissed.
The complainant has filed evidence affidavit along with 19 documents which were marked as Exhibit A1 to A19. Though the 1st opposite party has filed version they have not adduced any evidence.
Upon perusal of the pleadings and evidence on record, the issues to be framed are:
- Whether the repudiation of claim by the opposite party is justifiable or there is deficiency of service on the part of the opposite party?
- If so, what are the reliefs to be granted to the complainant?
Point no 1.
The complainant is the policy owner and his deceased wife was the life assured. The life assured died as result of coronary artery decease on the way to hospital. When the complainant submitted the claim for the insured amount, the opposite party rejected the same for the reason that the deceased was under treatment of diabetes mellitus and high blood pressure even prior to the proposal submission. The contract of insurance being one made with utmost good faith, the suppression of this fact by the deceased has made the contract ab initio void and hence the opposite party repudiated the claim.
In support of his case the complainant has produced several documents. Exhibits A1 to A7 are with regard to the policy along with the FIR, postmortem certificate and death certificate of the deceased which are not objected by the opposite party. The policy is admitted by the opposite party. The dispute is that the deceased was undergoing treatment for previous illness of diabetes mellitus and hyper tension as alleged in the version. Though the opposite party has vehemently contended in the version that the deceased was having previous deceases, they were not ready to adduce any evidence in this regard.
The complainant approached the complaints officer and the insurance ombudsman against this repudiation but both dismissed his complaint for the reason that the diabetes mellitus and hyper tension for which the deceased was undergoing treatment before the inception of the policy are pre-existing deceases under medication and according to the conditions of the policy, if preexisting deceases are there a claim they could not be honoured. Exhibit A15 is the award of the Insurance Ombudsman in which reliance is placed upon section VII point no 75 of the proposal form which pertains to health details of the life assured where the deceased LA had answered all the questions in negative. Based on the declaration made by the complainant and DLA the policy was issued. Thus an award was passed upholding the repudiation and dismissing the complaint.
From the version and from the pleadings of the complainant, we understand that the opposite party relied on one treatment records obtained from Udayagiri Multi Specialty hospital. The complainant has produced the same and marked as Exhibit A17. The complainant has produced a medical certificate issued by Dr.Nandakumar, the treating doctor of the deceased Shiney Sebastian, the wife of the complainant which states that the said Shiney Sebastian had consulted him on 06/11/18 for hypertension and type 2 DM. Her second consultation was on 16/05/2019 for urinary tract infection and the last was on 18/06/2019. She was on anti diabetic, anti hypertensive and antibiotics for UTI treatment in the letter head of Udayagiri Multi Specialty Hospital, Changanassery dated 26/02/2020 which was marked as Exhibit A16. PW1 is Dr.Nandakumar, who treated the deceased and issued A16 and A17. From the deposition of the doctor also the recording of A17 is not clear.
The opposite party has repudiated the claim of the complainant on the ground that the deceased life assured and the complainant had not disclosed that she was under medication for hypertension and diabetes mellitus since 2016. The opposite party relies on certain indisputable proof of the same. But the opposite party though filed version, has not produced any evidence in support of this contention. It is understood from their version and the award of the Insurance ombudsman that they rely on the document produced before us by the complainant as Exhibit A17. Exhibit A17 is said to be a hospital record though admitted by PW1, the treating doctor, as it is not properly recorded it is not admissible in evidence as conclusive proof. Exhibit A17 is a vague document without any date, signature of the issuing doctors. There is no valid proof for confirming that the said document is of the deceased life assured. PW1 has categorically deposed that the document produced by first opposite party which is said to be the document which caused the first opposite party to repudiate the claim was not issued by him. In that document treatment of another person is shown. Further PW1 has not produced the original treatment records of the deceased life assured even after receiving the direction of this Commission. Moreover, PW1 in his deposition and through issuing Exhibit A16 certificate has contradicted the said medical records.
Facts being so, even if the complainant and his wife the deceased life assured had not disclosed the treatment of hypertension and diabetes to the opposite party , whether it amounts to fraud as alleged by the opposite party ?
Section 45 stipulates that an insurer is restricted from calling into question a life insurance policy after an expiry of two years from the date on which it was effected on the ground that a false or inaccurate statement has been made in the (i) proposal; (ii) report of a medical officer, referee or a friend of the insured; or (iii) in any other document leading to the issue of policy. On the expiry of two years, the burden of proof shifts to the insurer who has to establish that the false or inaccurate statement was a material matter or related to material facts. In this case the policy period had completed 2 years.
Moreover Hon’ble Supreme Court have held in Venkat Naidu Vs LIC of India 2011 CPJ 6SC. If the Insurance Company disputes the policy for the reason that the insured did not disclose the previous illness, it is for them to prove that the lifestyle deceases like hypertension and diabetes cannot be considered as pre existing deceases and the insurer cannot repudiate the claim on this ground. The opposite party has failed to establish that the life assured has died because of a reason which has direct nexus with the alleged deceases and her death. As per Exhibit A5, the postmortem report, the cause of death of the life assured is shown as Occlusive coronary artery decease (normal).No evidence has been produced before us to prove that the said decease occurred only because of the hypertension and diabetes mellitus, the life assured allegedly had.
So in the light of above discussion we find that the repudiation of the claim is not proper.
The opposite party had paid two premium amounts upto Rs.1,91,386.72/- to the complainant. As the repudiation is found unlawful, the opposite party is bound to pay the sum assured to the complainant. The complainant having lost his wife had to run from pillar to post begging for the sum assured. Though he had paid the premium promptly he had to face unjustifiable act from the part of the opposite party which is found to be an unfair trade practice and deficiency in service. Hence the opposite party is bound to compensate the complainant for the mental agony and hardship he had to undergo all through these years.
Thus we allow the complaint and pass the following order
- The opposite party is directed to pay Rs.7,65,543/- to the complainant with an interest of 9% p.a from the date of 03.03.2020, the date of repudiation till realization.
- Opposite party is directed to pay Rs.10,000/- towards compensation and Rs.5,000/- as litigation cost to the complainant.
The order shall be complied within 30 days failing which the compensation amount shall carry 9% interest from the date of order till realization.
Pronounced in the Open Commission on this the 25th day of April, 2023.
Smt.Bindhu.R, Member sd/-
Sri.Manulal.V.S, President sd/-
Sri. K.M. Anto, Member sd/-
Appendix
Exhibits marked from the side of complainants.
A1- Copy of the cover note of Exide Life Insurance, dated 17.03.2018.
A2- Terms and conditions of Exide Life Insurance.
A3- Receipt (No.36349468) of Exide Life Insurance, dated 18.04.2019.
A4- Copy of the death certificate issued by Registrar of births and deaths Changanassery Municipality.
A5- Copy of the post-mortem certificate issued by department of Forensic Medicine, Govt.Medical College Kottayam, dated 28.10.2019.
A6- Copy of the First Information Report in crime number 2214/2019 of Changanassery Police Station.
A7- Copy of check list for death claims issued by Exide Life Insurance.
A8- Copy of the letter dated 21.01.2020 of Exide Life Insurance.
A9- Copy of letter dated 03.03.2020 of Exide Life Insurance.
A10- Copy of letter dated 10.03.2020 to Complaints Officer, Exide Life Insurance Company Limited, Bangalore.
A11- Copy of email from A12- Copy of letter to the Insurance Ombudsman, Office of the Insurance Ombudsman, Kochi dated 17.03.2020.
A13- Copy of letter to the Secretary, Office of the Insurance Ombudsman Kochi dated 13.06.2020.
A14- Copy of letter to the Secretary, Office of the Insurance Ombudsman Kochi dated 09.03.2020.
A15- Letter dated 28.09.2020 from Office of the Insurance Ombudsman, Kochi
A16- Copy of certificate signed by Dr.Nandakumar, Udayagiri Multi Speciality Hospital, Changanassery, dated 26.02.2020.
A17- Copy of medical prescription note (O.P.No.146124)
A18- Copy of driving license of Shiny Thomas, Thevalasseri, Kurisummoodu P.O.
A19- Original passport (No. 56929921) of Shiney Sebastian signed by Regional Passport Officer, Kochi.
Sworn statement from the side of complainant
Dr.S.Nandakumar, Late Shri.K.K.S.Pillai, Aravindam, Perunna, Changanassery,
Exhibits marked from the side of opposite party
Nil
By order
Sd/-
Assistant Registrar
