Haryana

Ambala

CC/265/2020

Ashok Kumar - Complainant(s)

Versus

PNB Metlife India Insurance Co Ltd - Opp.Party(s)

L.R. Saini

23 Oct 2023

ORDER

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION, AMBALA.

Complaint case no.	:	265 of 2020
Date of Institution	:	05.11.2020
Date of decision	:	23.10.2023

Ashok Kumar, aged 62 years, son of Shri Sona Ram R/o H.No.569, Laha Patti, village Saha, Sub Tehsil Saha District Ambala.

          ……. Complainant.

Versus

PNB Metlife India Insurance Company Ltd. Regd. office: Unit No.701, 702 & 703, 7th Floor, West Wing, Raheja Towers, 26/27, M.G. Road, Bangalore-560001, Karnatka, through its Managing Director/Authorized Signatory.

….…. Opposite party.

Before:        Smt. Neena Sandhu, President.

                     Smt. Ruby Sharma, Member,

          Shri Vinod Kumar Sharma, Member.           

 

Present:       Shri L.R.Saini, Advocate, counsel for the complainant.                                                                                                                                     Shri Sanjeev Vashisht, Advocate, counsel for OP.

Order:        Smt. Neena Sandhu, President.

                   Complainant has filed this complaint under Section 35 of the Consumer Protection Act, 2019 (hereinafter referred to as ‘the Act’) against the Opposite Party (hereinafter referred to as ‘OP’) praying for issuance of following directions to it:-

1. To settle the claim of the complainant which comes to Rs.4 lacs.
2. To pay Rs.50,000/ as compensation, on account of harassment, and mental tension, financial loss etc.
3. To pay Rs.22,000/- as litigation expenses

Or

Grant any other relief which this Hon’ble Commission may deems fit.

 

2.             Brief facts of the case are that the wife of the complainant namely Manju had purchased a policy No.23306827 named Metlife Guaranteed Saving in the month of May, 2020, from the OP. The agent of the OP visited the house of the complainant and verified the condition of wife of the complainant and thereafter got the signature on some papers regarding the purchase of the above mentioned policy on 18.5.2020 and also took photographs of the policy holder. Cheque in the sum of Rs.41,000/- (cheque No.671297) dated 21.5.2020 in favour of the OP qua premium payment of first installment was also handed over to the said agent. Thereafter, the OP sent a message on 25.5.2020 on the mobile of the complainant regarding the application for the policy and further intimated on 27.5.2020 regarding issuance of the policy on the website. On 30.5.2020, the wife of the complainant suffered a heart attack and died in Village Saha, Distt. Ambala. After the death of wife of the complainant, the complainant applied for the claim regarding the said policy/plan issued by the OP to the wife of the complainant, but the OP without paying the full amount of the policy/ plan, transferred only Rs.39234.46 on 18.8.2020 through NEFT in the account of the complainant i.e. installment amount received by the OP regarding the above referred policy. Thereafter the complainant also requested to the OP  to give full benefit of the said policy/plan in his favour, as the wife of the complainant has died due to heart attack, but the OP  did not pay any heed to the genuine request of the complainant and also issued a letter dated 19.8.2020 received by the complainant on 27.08.2020, mentioning therein that OP  cannot accept any responsibility for the above claim due to non disclosure of essential facts as per the terms and conditions of the policy and also further mentioned that the OP  have received medical record which indicate that late Mrs. Manju was suffering from cancer before taking this policy. The cancer is a such type of disease which may take more than six months to cause death of any person and nobody can assume that when a person is all right till 18.5.2020 and suddenly he/ she can die on 30.5.2020 due to cancer in a short span of time. As a matter of fact, Smt. Manju was not suffering from any cancer and she died due to heart attack and the complainant is entitled for full claim as per the terms and conditions of the policy. The OP in order to save himself from the liability of the full claim of the policy of wife of the complainant, intentionally and deliberately refunded the premium amount only to the complainant which is totally a deficiency in service on its part.   The complainant got issued a legal notice dated 11.09.2020 upon the OP to settle the claim of the complainant, but despite notice, the OP has failed to do the needful. Hence this complaint.
3.           Upon notice, OP appeared and filed written version and raised preliminary objections with regard to maintainability, not come with clean hands and suppressed the material facts etc. On merits, it has been stated that  the policy in question was issued by the Company on the basis of the information provided by the complainant and Life Assured namely Mrs Manju ("DLA") in the proposal form. Since the information provided by complainant and DLA in the proposal form was established to be incorrect by the Company, as such, the Company was well within its right to repudiate the claim of the complainant. The claim was investigated under section 45 of the Insurance Act, 1956 to verify the veracity of the claim. The investigator procured the medical treatment record of Capital Super Specialty Hospital, Civil Lines, Jagadhri, District Yamuna Nagar wherein the DLA was admitted in the Hospital vide CR No. 1530/04/2020 dated 18.04.2020 and date of death was shown as 30.05.2020. From the said medical record, it is clear that the DLA was in a very critical state of health and further during investigation it also came to knowledge that the complainant is working as an Insurance Agent and running an insurance agency in her adopted daughter namely Minni Chhabra. From the inquiries and from the vicinity, it also came to knowledge that in the year 2016, the DLA got paralyzed and was treated by Dr. Davinder Singh Hardai. However, the relevant question in the application form seeking insurance cover under this policy was answered as "NO" by late Mrs. Manju & by the complainant. The said medical record was prior to the proposing the Insurance policy and the same was not disclosed to the Company with malafide intention. From the stated circumstances, it is evident that the Life Assured and complainant had given wrong information and suppressed material facts in order to wrongfully obtain the subject policy from the Company. The policy in question was issued on 28.05.2020 with risk commencement date 26.05.2020 and the life assured died on 30.05.2020 within just 4 days from the date of commencement of risk. The early death of the life assured and taking of high sum assured policy, clearly proves that the policy in question was taken by the DLA & complainant only to play fraud with the OP. Recently the Haryana Police Special Task Force (STF) unearthed a syndicated Insurance fraud in which the insurance policies were taken in the name of cancer/critical illness patient and thereafter their death was shown as accident in connivance with the Doctors and Police Officials and in this regard the STF has registered an FIR at Sonepat Police Station. In the present case, thus, when the investigator submitted his report dated 07.08.2020 with the OP, after perusing the report and documents, the claim of the complainant was repudiated vide letter dated 19.08.2020 as per terms & conditions of the policy and the premium amount of Rs.39,234.46 was refunded to the complainant.  The answering OP reserves its right to initiate criminal proceedings against the person involved in the said insurance fraud. Rest of the averments of the complainant were denied by the OP and prayed for dismissal of the present complaint with heavy costs.
4.           Learned counsel for the complainant tendered affidavit of the complainant as Annexure CW1/A alongwith documents as Annexure C-1 to C-9 and closed the evidence on behalf of the complainant. Learned counsel for the OP tendered affidavit of Shri Arijit Basu, Senior Manager (Legal) the OP Company- PNB Metlife Insurance Company Limited, Registered Office at Unit No.701,702 & 703, 7^th Floor West Wing, Raheja Towers, 26/27, M.G.Road bangalore-560001 as Annexure OP-A alongwith documents Annexure OP-1 to OP-5 and closed evidence on behalf of the OP.
5.           We have heard the learned counsel for the complainant and learned counsel for the OP and carefully gone through the case file and also gone through the written arguments filed by the learned counsel for the OP.
6.           Learned counsel for the complainant submitted that the agent of the OP after verifying the condition of the wife of the complainant got her signatures on some papers regarding purchase of the policy. On 27.05.2020, the OP issued the policy and her name, unfortunately, on 30.05.2020, wife of the complainant died due to heart attack. Complainant lodged the claim with the OP but it instead of paying the entire claim amount, on 18.08.2020, transferred Rs.39234.46 (i.e installment amount) through NEFT in the account of the complainant on the ground that the wife of the complainant had taken the policy in question by concealing the material facts about her health. He further submitted that the wife of the complainant was not suffering from Cancer and she died due to heart attack and as per terms and conditions of the policy the complainant is entitled to get the claim amount. By not paying the claim amount and refunding the premium amount, the OP has not committed deficiency in providing service but has also indulged into unfair trade practice. The learned counsel for the complainant placed reliance on the judgment dated 09.10.2020, passed by the Hon’ble Supreme Court of India, in the case of Branch Manager, Bajaj Allianz Life Insurance Company Limited and Others & Another Versus Dalbir Kaur.  
7.           Learned counsel for the OP submitted that since the insured had concealed the material fact with regard to her pre-existing ailment, as stated in entire treatment records of the hospital from where she was taking treatment wherefrom it is clearly coming out that she was suffering from last stage of cancer and as such died after 4 days of obtaining the policy in question,  as such, claim was rightly repudiated by the OP. The learned counsel for the OP placed reliance on the judgment dated 24.04.2019, passed by the Hon’ble Supreme Court of India, in the case of Reliance Life Insurance Company Limited & Another Versus Rekhaben Nareshbhai Rathod.
8.           It is significant to mention here that to prove its case, the OP has placed on record  treatment records of the Capital Super Speciality Hospital, Annexure OP-4 colly, for the period from 04.05.2020 to 30.05.2020, which shows that the wife of the complainant-Manju (insured) was taking treatment for Adenocarcinoma i.e cancer. It is also coming out from the said record that even on the date of obtaining the policy in question i.e. on 18.05.2020 also she was taking treatment of cancer from the said hospital. Thus, the treatment records Annexure OP-4 colly, leaves no doubt with this Commission to hold that the wife of the complainant was suffering from cancer before obtaining the policy in question, yet, there has been concealment with regard to the same and against the column 4 (Para No.3) of the proposal form Annexure OP-1 wherein it was asked as to whether the wife of the complainant is being treated from cancer, tumour, cyst, leukemia, growth lump or other malignance, it has been answered as “NO”.  It may be stated here that the contracts of insurance including the contract of life assurance are contracts uberrima fides and every fact of material (sic material fact) must be disclosed, otherwise, there is good ground for rescission of the contract. The duty to disclose material facts continues right up to the conclusion of the contract and also implies any material alteration in the character of risk which may take place between the proposal and its acceptance. If there are any misstatements or suppression of material facts, the policy can be called into question.
9.           However, to writhe out of the situation, the complainant in his complaint has stated since his wife died of heart attack, it has no nexus with cancer, as such, the OP was not entitled to repudiate the claim of the complainant. It may be stated here that in the case of Reliance Life Insurance Company Limited & Another Versus Rekhaben Nareshbhai Rathod (supra)  the Hon’ble Supreme Court has referred the case Mithoolal Nayak Vs. Life Insurance Corporation of India (AIR 1962 SC 814), in which the position of law was stated as under:

“……The three conditions for the application of the second part of s.                          45 of the Insurance Act, 1932 are:

(a) the statement must be on a material matter or must suppress facts which it was material to disclose ;

(b) the supression must be fraudulently made by the policy holder; and

(c) the policy holder must have known at the time of making the statement that it was false or that it suppressed facts which it was material to disclose

 Where the policy holder, who had been treated, a few months before he submitted a proposal for the insurance of his life with the insurance company by a physician of repute for certain serious ailments as anaemia, shortness of breath and asthma, not only failed to disclose in his answers to the questions put to him by the insurance company that he suffered from those ailments but he made a false statement to the effect that he had not been treated by any doctor for any such serious ailment, Held (i) that, judged by the standard laid down in s. 17, Contract Act, the policy holder was clearly guilty of a fraudulent suppression of material facts when he made his statements, which he must have known were deliberately false and hence, the policy issued to him relying on those statements was vitiated.

This decision was relied upon in Life Insurance Corporation of India vs. Smt.G.M.Channabasamma (1991) (1) SCC 357, in which the following observations were made: It is well settled that a contract of insurance is contract uberrima fides and there must be complete good faith on the part of the assured. The assured is thus under a solemn obligation to make full disclosure of material facts which may be relevant for the insurer to take into account while deciding whether the proposal should be accepted or not. While making a disclosure of the relevant facts, the duty of the insured to state them correctly cannot be diluted. Section 45 of the Act has made special provisions for a life insurance policy if it is called in question by the insurer after the expiry of two years from the date on which it was effected. Having regard to the facts of the present case, learned counsel for the parties have rightly stated that this distinction is not material in the present appeal. If the allegations of fact made on behalf of the appellant Company are found to be correct, all the three conditions mentioned in the section and discussed in Mithoolal Nayak vs. Life Insurance Corporation of India must be held to have been satisfied. We must, therefore, proceed to examine the evidence led by the parties in the case.…”.

10.           This has been reiterated by the Hon’ble Supreme Court in the judgments in P C Chacko vs. Chairman, Life Insurance Corporation of India and Satwant Kaur Sandhu vs New India Assurance Company Limited. In Satwant Kaur Sandhu vs New India Assurance Company Ltd., at the time of obtaining the Mediclaim policy, the insured suffered from chronic diabetes and renal failure, but failed to disclose the details of these illnesses in the policy proposal form. Upholding the repudiation of liability by the insurance company, the Hon’ble Supreme Court held as under:

“…..25. The upshot of the entire discussion is that in a contract of insurance, any fact which would influence the mind of a prudent insurer in deciding whether to accept or not to accept the risk is a “material fact”. If the proposer has knowledge of such fact, he is obliged to disclose it particularly while answering questions in the proposal form. Needless to emphasise that any inaccurate answer will entitle the insurer to repudiate his liability because there is clear presumption that any information sought for in the proposal form is material for the purpose of entering into a contract of insurance….”

 

11.           It may be stated here that in the case of in the case of Branch Manager, Bajaj Allianz Life Insurance Company Limited and Others & Another Versus Dalbir Kaur (supra) relied upon by the complainant, the deceased was not suffering from life –threatening disease. The facts of this case are totally distinguishable to that of the present case, as such, no help can be drawn by OPs No.1 and 2 from the said judgment relied upon by him.     
12. In this view of the matter, since the OP has proved on record that there has been a material concealment at the time of obtaining the policy in question with regard to treatment  being taken by the wife of the complainant, as such, the OP was right in repudiating the claim in question. Resultantly, this complaint stands dismissed with no order as to cost. Certified copies of the order be sent to the parties concerned as per rules.  File be annexed and consigned to the record room

 

 Announced:- 23.10.2023

 

(Vinod Kumar Sharma)	(Ruby Sharma)	(Neena Sandhu)
Member	Member	President