Complainant Smt.Bindo  through the present complaint filed U/S 12 of the Consumer Protection Act (for short, C.P.Act.) has prayed for the issuance of the necessary directions to the opposite party  to honour her claim and make the payment of insured amount immediately in terms of the Insurance Policy. Opposite parties be further directed to pay Rs.50,000/- as compensation on account of mental agony, physical harassment and deficiency in service on the part of the opposite parties alongwith Rs.5,000/- as litigation expenses, in the interest of justice.

2.       The case of the complainant in brief is that her husband namely Viki Masih obtained an insurance policy bearing policy No.21605420 dated 23.06.2015 in his name. Her husband was insured for a sum of Rs.13,89,120/- and she is the nominee of her husband. Her husband deposited premium of Rs.12,000/- with the opposite parties and the date of its maturity was 23.06.2045 and mode of payment of premium was quarterly. All the formalities were also completed by the duly authorized agent of the opposite party in his office of opposite party no.3 as the representative of the opposite party no.1 and 2 were sitting in the office of opposite party no.3. Unfortunately, all of sudden her husband died on 2.7.2015 in natural death  and information regarding his death was duly given to the opposite parties. Thereafter, she submitted claim for payment of the insured amount alongwith all vested benefits to the opposite parties but the opposite party no.2 vide letter dated 29.11.2016 repudiated her claim on false and flimsy ground. The observations raised by the opposite parties are totally false, imaginary, which has no legs to stand. Her husband was hale and hearty. Moreover, her husband was medically examined by the agent/representative of the opposite parties before issuance of insurance policy. The decision of the opposite parties is liable to be set aside. She is entitled to receive the amount of insurance policy. Thus, there is deficiency in service on the part of the opposite parties. Hence this complaint.

3.       Upon notice, the opposite parties appeared through their counsel and filed their written reply taking the preliminary objections that the complaint is false, malicious, incorrect and with malafide intent and is nothing but an abuse of the process of the law; the complaint filed by the complainant does not fall within the definition of a consumer dispute; the opposite party received the Death Claim Intimation from the complainant dated 15.9.2016 thereby intimating that the Person Insured died on 2.7.2015, which was duly acknowledged vide condolence letter dated 16.09.2016. The claim being an early claim, as the person insured died within a short span of only 9 days from the date of reinstatement of the policy, the opposite party as per the  procedure, carried out an investigation to settle the claim of the complainant. During the course of investigation and assessment of the claim, it was revealed to the opposite party that the DLI was suffering from lung cancer prior to the issuance of the policy. However, the DLI suppressed this material fact while submitting the proposal form. The DLI expired only within a short span of 9 days from the date of issuance of the policy and others objections have also raised by the opposite party. On merits, it was submitted that the DLI after completely understanding the terms and condition of our product had submitted the duly signed Proposal Form on 22.6.2015 and offered to pay Rs.12,420/- quarterly towards the initial premium against the Sum Assured of Rs.13,89,120/-. In the proposal form, there was a column wherein the DLI was required to provide answers with respect to his Medical History and the DLI replied that he was not suffering from any disease neither he was taking any medical treatment. Upon receipt of the duly filled up proposal form and believing the information provided by the DLI to be true and correct, alongwith the initial premium, the opposite party evaluated and processed the Proposal Form on the basis of the information furnished by Deceased Life Insured and issued the policy bearing No.21605420 with Risk Commencement date of 23.06.2015. It was further submitted that the DLI was suffering from Lung Cancer prior to the issuance of the policy and as such the claim of the complainant has been rightly repudiated by the opposite party. The DLI was duly bound to disclose his correct medical condition in order to assess the risk factor that opposite party will bear upon the life of insured and any non-disclosure of same would vitiate the contract at the option of opposite party. Thus, the complainant being beneficiary/nominee under the said policy is bound by the contents stated by Deceased Life Insured in the Proposal Form and cannot challenge the same.  Lastly, the complaint has been prayed to be dismissed with costs.

4.         Counsel for the complainant tendered into evidence affidavit of complainant Ex.C1 along with other documents Ex.C2 to Ex.C11 and closed the evidence,

5.            Counsel for the opposite parties tendered into evidence affidavit of Rajeev Sharma Ex.OP-W-1A, alongwith the other documents exhibited as Ex.OP1 to Ex.OP4 and closed the evidence.

6.      We analytically observe with the judicial precision and find that the OP insurers have arbitrarily repudiated (Ex.OP4) on 29.11.2016 the complainant’s impugned death-claim (Ex.OP2) for the sum assured for the reason that the DLI (Deceased Life Insured) has been suffering from Lungs Cancer much before purchasing the instant policy that did not cover the ‘pre-existing disorders’ as per its extant applicable terms. Somehow, the opposite party insurers here have failed to prove the alleged pre-existing ailment to justify its impugned repudiation through some cogent evidence necessary to be produced during the present proceedings and as such these amount to ‘bald’ statements, only.

7.       We find that the purchase and validity of the related policy have been duly admitted along with the factum of ‘early’ death of the DLI necessitating an investigation at insurers’ end. Further, the complainant has satisfactorily proved all the contents of her allegation-contented complaint through presentation of her evidentiary documents exhibited here as Ex. C1 to Ex.C11. The OP insurers in turn have produced the affidavit Ex.OPw1/A by its Sr. Manager Legal duly deposing the contents of the written statements along with the other evidentiary documents Ex.OP1 to Ex.OP4 but that fails to prove/ establish the allegations of pre-existing Lungs Cancer that otherwise has been merely an intimation by one of the DLI’s neighbor to the insurer’s surveyor/ investigator having no better legal value than ‘hear-say’ evidence. Somehow, the OP insurers have failed to produce and prove the surveyor’s/ treating doctor’s affidavit, discharge summary, treatment history and surgery schedule etc to prove their allegation of pre-existing disease/ailment etc for reasons best known to them alone and that addresses its repudiation as arbitrary, unfair, unethical and for the sake of some collateral considerations, only. The OP insurers have based their above repudiation decision solely on presumptions and hearsay evidences and the same are not admissible in judicial adjudicatory. Further, there has been no documentary evidence available and/or produced on the records of the present proceedings proving the presence/ knowledge/ symptoms of the ‘ailment’ (prior to the date of policy) to the DLI pertaining to the present death-claim as has been stood preferred.

8.       Thus, the alleged misrepresentation/concealment/non-disclosure of material facts etc do not stand proved. In such like repudiations the o. n. p. (onus of proof) always lay heavily upon the insurers but here they have miserably failed to legally discharge the same successfully. We are strengthened in our above proposition by virtue of the valuable comments as made out by the honorable Punjab State Commission in the FA # 537 of 2008 titled: LIC of India vs. Priya Sharma & ors., as: “…. in this case, there is no evidence on record to prove that the deceased life assured was suffering from any pre-existing disease at the time of purchasing the policy. …. There is no evidence to prove that the deceased was ever admitted or took any treatment from any hospital or the doctor regarding the alleged pre-existing disease. …”.  The honorable National Consumer Commission has further elaborated the legal proposition in RP # 218 of 2008 titled United India Insurance Co. Ltd., vs. Anumolu Rama Krishan as: “7… Even if Respondent was suffering from these diseases which admittedly do not occur overnight, it is both possible and plausible that he was unaware of it since these can be ‘silent diseases’ and a person suffering from them may not even be aware until the condition aggravates and overt symptoms appear….”. We also find that the death-claim put forth by the complainant was kept illogically deferred awaiting ‘settlement’ for collateral but arbitrary reasons. Even, the expert professional opinion pertaining to pre-existing disease cannot be taken as an evidence of its ‘non-disclosure/ suppression’ by the insured since the DLI may not be ‘himself’ aware of  the disease present in its latent hibernating state.

9.       In the light of the all above, we are of the considered opinion that the OP insurers have blatantly bruised the consumer rights of the present complainant by employing ‘unfair trade practice’ amounting to ‘deficiency in service’ (on their part) and that lines them up for an adverse statutory award under the applicable Consumer Protection Act’ 1986. We, therefore,  partly allow the present complaint and thus ORDER the OP insurers to pay impugned ‘death-claim’ to the full sum-assured amount as per the governing ‘terms’ of the applicable Insurance Policy (to its full benefits) strictly in accordance with IRDA guidelines on ‘settlement of claims’ favoring the complainant besides to pay her Rs.10,000/- as cost and compensation within 30 days of receipt of the copy of the present orders otherwise the aggregate award amount shall attract interest @ 9% PA from the date of the orders till actual payment.

10.     Copy of the order be communicated to the parties free of charges. After compliance, file be consigned to record.

                                                                                (Naveen Puri)

                                                                                    President.     

ANNOUNCED:                                                              (Jagdeep Kaur)

July 09, 2018.                                                                 Member.

*MK*