Delhi

New Delhi

CC/989/2013

Naresh Kumar - Complainant(s)

Versus

M/S. Future General India Insurance Company Ltd. - Opp.Party(s)

01 Jun 2023

ORDER

 

DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION-VI

(NEW DELHI), ‘M’ BLOCK, 1^STFLOOR, VIKAS BHAWAN,

I.P.ESTATE, NEW DELHI-110002

Case No.CC-989/2013

IN THE MATTER OF:

Sh. Naresh Kumar

S/o Sh. Kashi Ram,

R/o – 29A, N-Block, Gopal Nagar,

Near Khorwal Dhramkanta,

Najafgarh, New Delhi.

......Complainant

Versus

 

Future Generali Indian Insurance Company Ltd.

303-310, 3^rd Floor, Kailash Building,

K.G. Marg, Connaught Place,

New Delhi.

Through its General Manager

Opposite Party

Quorum:

 

Ms. Poonam Chaudhry, President

Mr. Bariq Ahmad, Member

Mr. Shekhar Chandra, Member

                                                          Date of Institution:08.11.2013

 Date of Order     : 01.06.2023

 

ORDER

 

POONAM CHAUDHRY, PRESIDENT

 

1. The present complaint has been filed under section 12 of the Consumer Protection Act, 1986 (in short CP Act) against Opposite Party (in short OP) alleging deficiency of services.  Briefly stated the facts as borne out from the complaint are that the complainant is the holder of Future Health Suraksha (Individual Policy) from the OP which was renewed from time to time.
2. The complainant further alleged that he filed a claim in August, 2013 before the OP but the said claim was rejected by OP without any reasonable ground vide letter dated 23.08.2013.  It is further alleged that claim was rejected on the ground that complainant had concealed material facts and violated the terms and conditions of the Policy. It is also alleged that complainant completed all the necessary formalities as required at the time of taking policy and disclosed all the queries made by OP but the OP was adamant to cancel the policy in on illegal and arbitrary manner. Complainant replied to the letter dated 26.08.2013 of OP controverting the allegations of OP and requested not to cancel the same. It is further stated that the action of OP is highly illegally and arbitrary as the OP has no right to cancel the policy. It is stated that complainant suffered great mental torture and harassment from the above conduct of the OP and was unable to get treatment due to above letter of the OP.
3. It is also alleged that at the time of purchase of the policy, the copy of the terms and conditions of the said policy was not provided to the complainant despite repeated requests.
4. It is prayed that OP be directed not to cancel the policy in question no. 2012-H0047382-FHI and the complainant be compensated by awarding compensation of Rs.2,00,000/- (Rupees Two Lakh) for unfair trade practice and causing mental harassment/ tension to the complainant by OP. Cost of litigation be also awarded.
5. Notice of the complaint was issued to OP who entered appearance and filed written statement/reply contesting the case stating an insurance policy i.e. Future Health Suraksha (individual policy) was taken by the complainant vide policy no. 2012-H0047382-FHI from the OP on 21.03.2013 for a period of 1 year expiring on 20.03.2013.  The said policy was renewed on 21.03.2013 for 1 year expiring on 20.03.2014.
6. It was further stated that a contract of insurance is a contract of utmost good faith. The insured is under a fundamental obligation to inform the insurer about the exact position and nature of risk that he/she is transferring onto the insurer. The complainant however failed to do so and did not reveal that he was suffering the pre-existing disease, in the proposal form of the policy with a mala fide intention.
7. It was also submitted the complainant was admitted in Alchemist Hospital on 27.06.2013 for Coronary Artery Disease, Primary Hypertension and Diabetes Mellitus. The discharge summary of the said admission of the complainant clearly states that the complainant is suffering with Coronary artery disease since 2011. The cardiac catheterization and coronary angiography report of the complaint also supports that the complainant was suffering from the disease since 2011. It was alleged that as per Clause 2 of the covernote policy non-disclosure of information existing diseases would be considered as non disclosure of material information. It was also alleged that the compensation claimed by the complainant is exorbitant. The complaint has not filed even a single document which substantiates losses suffered by him. It was also prayed that the complaint be dismissed.
8. Complainant filed rejoinder reiterating therein the contents of the complaint and denying all allegations made in the written statement. Evidence has been led by both the parties. The stand taken by the Opposite Party is that since the complainant concealed material facts relating to pre-existing disease i.e. he was suffering from CAD/hypertension since 2011, a notice of rejection/cancellation of the policy was communicated to the complainant by the OP vide its letter dated 26^th August, 2013.
9. The complainant had denied the allegations made in the said communication and stated that he had sent a letter to OP 6^th September, 2013. The OP has drawn our attention to a judgment of the Hon’ble Supreme Court of India in ‘Civil Appeal No. 3944 of 2019 ‘Life Insurance Corporation of India Vs. Manish Gupta’. In the said case, though the insured did not disclose the past history and denied of any pre-existing disease but the hospital records where he was treated revealed that the insured suffered from rheumatic heart disease since childhood and on this ground his claim was repudiated in terms of the exclusions contained in the policy. The Hon’ble Apex Court was pleased to hold that the failure of the insured to disclose the past history of cardiovascular disease was a valid ground for repudiation.
10. The plea of the OP is that the insured has not disclosed or declared in his proposal form that he is suffering from the disease. However, the argument of the complainant is that he was not supplied with copy of terms and conditions of said policy despite repeated requests. He has also denied that he was suffering from any disease as such there was no question of concealment of this fact.
11. Counsel for complainant contended that the policy form was filled by agent of OP. It is also stated that notice of cancellation of policy issued by OP dated 26.08.2013 was totally illegal. It was also alleged that complainant was not suffering from any disease which disentitles from benefit of policy.
12. It is to be noted OP had sent notice of cancellation of policy dated 26.08.2013. It is the case of complainant that the declaration form was not filled by him but was filled by the agent of OP. OP has failed to show when it received the letter of Alchemist Hospital filed as Annexure (3) with the written statement. Complainant stated that the principle of utmost good faith was applicable to both parties i.e. insured and insurer.
13. It is an admitted case that complainant had taken the policy from OP for a period of one year on 21.03.2012 expiring on 20.03.2013 and the said policy was renewed on 21.03.2013 for one year expiring on 20.03.2014.  It is to be noted that OP has not denied the averments of complaint that the terms and of the policy were not provided to the complainant. It is to be noted that OP has not filed any document to show that the terms and conditions of the policy were served or communicated on complainant.
14. It is argued on behalf of OP that clause of 2 of cover note of policy provides that any incomplete or incorrect information regarding pre-existing disease would be considered as non-disclosure of material information.
15. It is to be noted that as regards the liability of Insurance Company in case the terms and conditions of the policy were not communicated or served on the insured, it has been held by the Hon’ble Supreme Court in M/s Modern Insulators  Ltd. Vs. The Oriental Insurance Company 2000 (2) SCC 734 as under :

“It is the fundamental principle of insurance law that utmost good faith must be observed by the contracting parties and good faith forbids either party from non-disclosure of the lads which the parties known. The insured has a duty to disclose and similarly it is the duty of the insurance company and its agents to disclose ill material facts in their knowledge since obligation of good faith applies to both equally.

In view of the settled position of law we are of the opinion that the view expressed by the National Commission is not correct. As the above terms and conditions of the standard policy wherein the exclusion clause was included, were neither a part of the contract of insurance nor disclosed to the appellant respondent cannot claim the benefit of the said exclusion clause.Therefore, the finding of the National Commission is untenable in law.”

 

16. For the foregoing reasons, we are of the view that the act of OP amounts to deficiency of services. We direct OP to withdraw notice for cancellation of policy No. 2012-H0047382-FHI dated 26.08.2013 and further direct to OP to pay the claim amount as per claim repudiated vide letter dated 23.08.2013,  together with interest at the rate of 7% per anum from the filling of the this complaint and further direct OP to pay compensation of Rs.30,000/-(Rupees Thirty Thousand Only) towards mental harassment and Rs.20,000/- (Rupees Twenty Five Thousand) as cost of litigation.

A copy of this order be sent to all the parties free of cost. The order be uploaded on the website of this Commission.

File be consigned to record room along with a copy of the order.

 

Poonam Chaudhry

(President)

 Bariq Ahmad                                                                                                                      Shekhar Chandra

  (Member)                                                                                                                                 (Member)