Order by:
Sh.Amrinder Singh Sidhu, President
1. This Consumer Complaint has been received by transfer vide order dated 26.11.2021 of Hon’ble President, State Consumer Disputes Redressal Commission, Punjab at Chandigarh under section 48 of CPA Act, vide letter No.04/22/2021/4 C.P.A/38 dated 17.1.2022 from District Consumer Commission, Ludhiana to District Consumer Commission, Moga to decide the same in Camp Court at Ludhiana and said order was ordered to be affected from 14th March, 2022.
2. The complainant has filed the instant complaint under section 12 of the Consumer Protection Act, 1986 (now section 35 of Consumer Protection Act, 2019) on the allegations that on the allurement of the agent of the Opposite Parties, Fuman Singh husband of the complainant had purchased life insurance policy bearing No.21492743 for sum assured of Rs.11,40,000/- and paid first premium of Rs.40,000/-. Further alleges that unfortunately, husband of the complainant died a natural death on 28.02.2015. Thereafter, the complainant being his nominee lodged the claim for the payment of the sum assured and completed all the formalities, but the Opposite Parties are dilly delayed the matter on one or other false pretext and as such, there is deficiency in service on the part of the Opposite Parties. Vide instant complaint, the complainant has sought the following reliefs.
a) The Opposite Parties may be directed to pay the sum assured of Rs.11,40,000/- alongwith interest @ 18% per annum besides Rs.2 lakhs on account of compensation or any other relief to which this District Consumer Commission may deem fit be also granted.
3. Opposite Parties appeared through counsel and contested the complaint by filing the written version taking preliminary objections therein inter alia that the complaint filed by the complainant is not maintainable and is liable to be dismissed as the complainant has attempted to misguide and mislead this District Consumer Commission. It is submitted that the Opposite Parties were in receipt of a duly filled and signed proposal form dated 09.02.2015 from one Fuman Singh (DLI) for obtaining a policy of Life Insurance of their product “Met Smart Platinum” and offered to pay Rs.40,000/- annually towards the initial premium against the sum assured of Rs.11,40,000/-. Upon receipt of the duly filled up proposal form alongwith the initial premium, the Opposite Party evaluated and processed the proposal form on the basis of the information furnished by DLI and issued policy bearing No. 21492743 with Risk Commencement date of 10.02.2015. The complainant was made the nominee under said policy and said policy was dispatched at the address of the DLI. It is submitted that there has been no legally valid contact of insurance between the Opposite Parties and DLI. The policy was issued on 10.02.2015 and the DLI expired on 28.01.2015 i.e. prior to the issuance of the policy and thus as per the principle of law, there can not be any contract with a dead person and as such, the contract of insurance was void ab initio. Since there was no contract between the parties, the complainant does not qualify to be a consumer within the meaning of the Act and hence there is no deficiency in service on the part of the Opposite Parties. On merits, Opposite Parties took up the same and similar pleas as taken up by them in the preliminary objections. Hence, the instant complaint is not maintainable and the same may be dismissed with costs.
4. In order to prove her case, the complainant has tendered into evidence the affidavit Ex.CW alongwith copies of documents Ex.C1 to Ex.C4 and closed the evidence.
5. On the other hand, to rebut the evidence of the complainant, Opposite Parties also tendered into evidence the affidavit Ex.RA alongwith copies of documents Ex.R1 to Ex.R4 and closed the evidence.
6. We have heard the ld.counsel for the parties, perused the written arguments filed by the complainant and also gone through the documents placed on record.
7. Ld.counsel for the Complainant as well as ld.counsel for the Opposite Parties have mainly reiterated the facts as narrated in the complaint as well as in their written statements respectively. We have perused the rival contention of the ld.counsel for the parties. The only contention of the complainant is that Fuman Singh husband of the complainant had purchased life insurance policy bearing No.21492743 for sum assured of Rs.11,40,000/- and paid first premium of Rs.40,000/-. Further alleges that unfortunately, husband of the complainant died a natural death on 28.02.2015. Thereafter, the complainant being his nominee lodged the claim for the payment of the sum assured and completed all the formalities, but the Opposite Parties are dilly delayed the matter on one or other false pretext and as such, there is deficiency in service on the part of the Opposite Parties. On the other hand, ld.counsel for the Opposite Parties has repelled the aforesaid contention of the complainant on the ground that Opposite Parties were in receipt of a duly filled and signed proposal fr0m dated 09.02.2015 from one Fuman Singh (DLI) for obtaining a policy of Life Insurance of their product “Met Smart Platinum” and offered to pay Rs.40,000/- annually towards the initial premium against the sum assured of Rs.11,40,000/-. Upon receipt of the duly filled up proposal form alongwith the initial premium, the Opposite Party evaluated and processed the proposal form on the basis of the information furnished by DLI and issued policy bearing No. 21492743 with Risk Commencement date of 10.02.2015. The complainant was made the nominee under said policy and said policy was dispatched at the address of the DLI. It is submitted that there has been no legally valid contact of insurance between the Opposite Parties and DLI. The policy was issued on 10.02.2015 and the DLI expired on 28.01.2015 i.e. prior to the issuance of the policy and thus as per the principle of law, there can not be any contract with a dead person and as such, the contract of insurance was void ab initio.
8. Perusal of the proposal form Ex.R1 shows that it is duly filled and complete in all respect, on 09.02.2015 under the signatures of Fuman Singh (DLI) and on the basis of this proposal form policy bearing No. 21492743 was issued in favour of said Fuman Singh and in this regard, the premium instalment of Rs.40,000/- was paid to the Opposite Parties. On the other hand, the copy of death certificate of Phuman Singh (Ex.C3) shows that he died on 28.02.2015 i.e. after 18 days of issuance and proposal for the policy in question. The contention of the Opposite Parties is that DLI expired on 28.01.2015 and that the policy was issued on 10.02.2015 i.e. DLI expired prior to the issuance of the policy. Ld.counsel for the Opposite Parties has further contended that the complainant had submitted a death certificate wherein it has been mentioned that the DLI expired on 28.02.2015 and the Issuing Authority had cancelled the said Death Certificate and stated that DLI had expired on 28.01.2015 and hence there is breach of terms and conditions of the policy and accordingly the policy in question was cancelled and the premium amount of Rs.37,568.32 paisa as per the fund value, has already been transferred in the account of the complainant through NEFT, but however, the complainant could not rebut the death certificate Ex.C3 in which the date of death of DLI Phuman Singh is mentioned as 28.02.2015 alongwith statements of respectable persons of the village and in these statements they specifically mentioned that Phuman Singh had died on 28.02.2015. However, as per the version of the Opposite Parties, if the complainant has breached the terms and conditions of the insurance policy and even then the Insurance Company ought to have settled the claim of the complainant on “non standard basis” even if some of the conditions of the insurance policy are not adhered by the insured. In this regard, we are supported with judgment in case titled National Insurance Company Limited versus Kamal Singhal IV (2010)CPJ297 (NC) wherein the Hon'ble National Consumer Disputes Redressal Commission, New Delhi relying upon various decisions of the National Consumer Disputes Redressal Commission in the matter of (1) National Insurance Company Ltd. v. J. P. Leasing & Finance Pvt. Ltd. (RP No. 643/2005), (2) Punjab Chemical Agency v. National Insurance Company Ltd. (RP No. 2097/2009), (3) New India Assurance Co. Ltd. v. Bahrati Rajiv Bankar, (RP) No. 3294/2009) and (4) National Insurance Company Ltd. v. Jeetmal, (RP No.3366/2009) and also judgment of the Hon'ble Apex Court in the matter of Insurance Company Versus Nitin Khandewal IV (2008) CPJ 1(SC), held the breach of condition of the policy was not germane and also held further that : “the appellant Insurance Company is liable to indemnify the owner of the vehicle when the insurer has obtained comprehensive policy to the loss caused to the insurer”. The Hon'ble Supreme Court has further held that; “even assuming that there was a breach of policy, the appellant Insurance Company ought to have settled the claim on “non-standard basis.” Hon'ble Apex Court in back drop of these features, in these cases, allowed 70% of the claim of the claimant on the “non-standard basis”. This view was again reiterated by the Hon'ble Apex Court in the matter of Amalendu Sahoo versus Oriental Insurance Company Limited. II(2010) CPJ 9(SC)=II (2010)SLT 672. Hon'ble National Commission in the case National Insurance Company Limited versus Kamal Singhal referred to above relying upon the law laid down by the Hon'ble Supreme Court has held that;
“there being a long line of decisions on this score, we have no option but to uphold the finding of Fora below with modification that the claim be settled on 'non-standard' basis”, in terms of the guidelines issued by the Insurance Company. In case petitioner company fails to carry out the direction contained therein, the amount payable on 'non-standard' basis, shall carry interest @ 6% p.a from the date of expiry of six weeks till the date of actual payment”.
9. In such a situation the repudiation made by Opposite Party regarding genuine claim of the complainant appears to have been made without application of mind. It is usual with the insurance company to show all types of green pesters to the customer at the time of selling insurance policies, and when it comes to payment of the insurance claim, they invent all sort of excuses to deny the claim. In the facts of this case, ratio of the decision of Hon’ble Apex Court in case of Dharmendra Goel Vs. Oriental Insurance Co. Ltd., III (2008) CPJ 63 (SC) is fully attracted, wherein it was held that, Insurance Company being in a dominant position, often acts in an unreasonable manner and after having accepted the value of a particular insured goods, disowns that very figure on one pretext or the other, when they are called upon to pay compensation. This ‘take it or leave it’, attitude is clearly unwarranted not only as being bad in law, but ethically indefensible. It is generally seen that the insurance companies are only interested in earning the premiums and find ways and means to decline claims. In similar set of facts the Hon’ble Punjab & Haryana High Court in case titled as New India Assurance Company Limited Vs. Smt.Usha Yadav & Others 2008(3) RCR (Civil) Page 111 went on to hold as under:-
“It seems that the insurance companies are only interested in earning the premiums and find ways and means to decline claims. All conditions which generally are hidden, need to be simplified so that these are easily understood by a person at the time of buying any policy.The Insurance Companies in such cases rely upon clauses of the agreement, which a person is generally made to sign on dotted lines at the time of obtaining policy. Insurance Company also directed to pay costs of Rs.5000/- for luxury litigation, being rich.
10. Now come to the quantum of compensation. The complainant has claimed the insurance amount as per the policy amounting to Rs.11,40,000/- on the death of Phuman Singh, DLI. Hence, having regard to the position of the law, as has been laid down, by the Hon'ble Apex Court in the various decisions referred to here-in-above and also the view expressed by the Hon'ble National Commission, we are of the considered view that in the present case the complainant, if not entitled for the entire amount of insurance, the Insurance Company definitely ought to have settled the complainant's claim on 'non-standard basis”, which in the facts and circumstances taking the assistance of the view expressed by the Hon'ble Apex Court and also by the Hon'ble National Commission, we allow 70% of the assessed amount on 'non-standard' basis” of the insured amount.
11. In view of the aforesaid facts and circumstances of the case, we partly allow the complaint of the Complainant and direct the Opposite Party-Insurance Company to make the payment of Rs.7,98,000/- (Rupees seven lakh ninety eight thousands only) i.e. 70% of the insured amount of Rs.11,40,000/- to the Complainant within 60 days from the date of receipt of copy of this order failing which the complainant shall be at liberty to get the order enforced through the indulgence of District Consumer Disputes Redressal Commission, Ludhiana. However, the Opposite Parties-Insurance Company shall be at liberty to deduct the amount of Rs.37,568.32 paisa, if any, already refunded to the complainant (as mentioned above) out of the awarded amount. All pending applications are disposed off accordingly. Copies of the order be furnished to the parties free of cost by District Consumer Disputes Redressal Commission, Ludhiana and thereafter, the file be consigned to record room after compliance.
12. Reason for delay in deciding the complaint.
This Consumer Complaint was originally filed at District Consumer Disputes Redressal Forum (Now Commission) at Ludhiana and it keep pending over there until Hon’ble State Consumer Disputes Redressal Commission, Punjab vide letter No.04/22/2021/4 C.P.A/38 dated 17.1.2022 has transferred the instant Consumer Complaint alongwith Other Complaints to District Consumer Commission, Moga with directions to work on this file onward from 14th March, 2022 and accordingly District Consumer Commission, Moga has decided the present complaint at Camp Court, Ludhiana, as early as possible.
Announced in Open Commission at Camp Court, Ludhiana.
