Haryana

StateCommission

A/803/2015

BAJAJ ALLIANZ LIFE INSURANCE CO.LTD. - Complainant(s)

Versus

RAJEEV MANGLA - Opp.Party(s)

VARUN CHAWLA

05 Jul 2016

ORDER

STATE CONSUMER DISPUTES REDRESSAL COMMISSION HARYANA, PANCHKULA

                                                 

First Appeal No  :    803 of 2015

Date of Institution:    02.09.2015

Date of Decision :     05.07.2016

 

Bajaj Allianz Life Insurance Company Limited, through its Manager, 3641-40/B-1, 2^nd Floor near, HDFC Bank, G.T. Road, Agra Chowk, Palwal, District Palwal.

Through Mr. Rajinder Singh Kalsi, Zonal Legal Manager (North), Bajaj Allianz Life Insurance Company Limited, SCO 215-217, Sector-34, Chandigarh.

                                      Appellant/Opposite Party

Versus

 

Rajeev Mangla, Resident of 214, Aggarwal Colony, Railway Road, Hodal, District Palwal.

                                      Respondent/Complainant

 

CORAM:             Hon’ble Mr. Justice Nawab Singh, President.

                             Shri B.M. Bedi, Judicial Member.

                             Shri Diwan Singh Chauhan, Member   

 

Present:               Shri Varun Chawla, Advocate for appellant.

                             Shri Gautam Kaile, Advocate for respondent.

 

                                                   O R D E R

 

B.M. BEDI, JUDICIAL MEMBER

 

Bajaj Allianz Life Insurance Company Limited (for short ‘Bajaj Allianz’)-Opposite Party, is in appeal against the order dated December 10^th, 2014 passed by District Consumer Disputes Redressal Forum, Palwal (for short ‘the District Forum’) in Consumer Complaint No.96 of 2014.

2.      Rajeev Mangla-complainant/respondent got his daughter namely Deepa Mangla aged 9 years, insured with Bajaj Allianz vide two insurance policies, that is, Policy No.0277948085, commenced from 14.08.2012, vide Proposal dated 28.07.2012 (Annexure A-1) for Rs.2,50,000/- and the other Policy No.0276696242, commenced from 20.08.2012, vide Proposal dated 08.08.2012 (Annexure A-2) for Rs.2,50,000/-. The insured died on 07.03.2014. Claim being filed, Bajaj Allianz paid Rs.55,216/- and Rs.55,599/- vide two cheques dated 17.05.2014 as ‘Fund Value’ of the policies, however repudiated remaining claim on the ground that the insured was suffering from Moya-Moya disease since 10.04.2012 i.e. before purchase of the policies. The insured was got treated in All India Institute of Medical Sciences (AIIMS), New Delhi. The complainant did not disclose about the illness of the insured in the Proposal Forms Annexure-A1 and A2 and thus the polices were obtained by concealment and prayed fraud with Bajaj Allianz.  Aggrieved of the repudiation of claims, the complainant filed complaint under Section 12 of the Consumer Protection Act, 1986.

3.      The opposite party/appellant was proceeded exparte before the District Forum and on the basis of exparte evidence produced by the complainant, the District Forum vide impugned order allowed complaint. The operative part of the order is reproduced as under:-

“….So the complaint of the complainant is accepted and opposite party is directed to pay:-

(i)      Risk covered amount of the policies to the tune of Rs.5,00,000/- after deducting the amount if any paid to him. On the remaining amount which the opposite party will pay with interest @ 9% per annum from the filing of this complaint till realization of the due amount.

(ii)      The compensation for the physical, monetary and mental harassment to the tune of Rs.10,000/- and opposite party is further burdened with litigation expenses to the tune of Rs.2200/-. The compliance of these directions is to be made within 45 days from the receipt of the copy of this order and if the opposite party fails to comply the above directions within the stipulated period of 45 days then the opposite party will be further burdened to pay Rs.25,000/- to the complainant.”

 4.     Learned counsel for the appellant/Bajaj Allianz has assailed the order of the District Forum raising plea that the insured (since deceased) was suffering from Moya-Moya disease since 10.04.2012; she received treatment from AIIMS, New Delhi but at the time of purchasing the insurance policies, the complainant did not disclose this fact while filling up the Proposal Forms and thus committed fraud with Bajaj Allianz.  In support, reference was made to the Proposal Forms (Annexure-A1 & A2) and the Discharge Summary (Annexure A-4) issued from Department of Neurosurgery, C.N. Center & Gammaknife, AIIMS, New Delhi.

5.      At the time of purchasing the policy, the complainant submitted forms (Annexure-A1 and A2), wherein he answered questions under the heading “22. Declaration of Good Health” of insured as under:-

          “22.   Declaration of Good Health:

Have you ever been treated or currently under treatment for any of the following conditions:

Q.No.	Question	Answer
b)	Any diseases or disorders of the nervous system such as but not limited to frequent dizziness, fainting, seizure, weak limbs (Temporary or Permanent Disability) Abnormal Sight, Psychiatric Disease, Brain Diseases or Neurological System Diseases, Headaches, Vomiting, Numbness?	No

 

6.      Bajaj Allianz has produced medical record of Deepa-deceased Annexure A-4, that is, Discharge Summary issued from Department of Neurosurgery, AIIMS, New Delhi which showed that Deepa was suffering from Moya Moya disease. She was admitted in the above said hospital on 11.09.2012, operated upon on 20.09.2012 and discharged on 22.09.2012. The Chief History of the patient is as under:-

                   “Weakness of left side of body x 2.5 years.

                   Seizures x 2 years”

7.      Moyamoya disease is a rare, progressive cerebrovascular disorder caused by blocked arteries at the base of the brain in an area called the basal ganglia. From the medical record, it is evident that Deepa was suffering from Moya Moya disease; she was having weakness of left side of her body for the last more than two years and seizures for two years. But in the proposal forms (Annexure-A1 and A2), the complainant gave answers in negative.

 8.     It is well settled principle of law that the contract of insurance is based on the principle of utmost faith–uberrima fides and the insurer can repudiate the insurance claim if it finds that the policy was purchased by the complainant on mis-statement and by concealment of true fact regarding his/her health.

9.      In Mithoo Lal V. Life Insurance Corporation of India , AIR 1962 Supreme Court 814, Hon’ble Apex Court held as under:-

“Contract of life insurance entered into as a result of fraudulent suppression of material facts by policy holder- Policy is vitiated and person holding assignment of policy cannot claim benefit of contract………….”

10.    Hon’ble Apex Court in Modern Insulators Ltd. Vs. Oriental Insurance Co. Ltd. – (2000) 2 SCC 734 held as under:-

“It is the fundamental principle of insurance law that utmost good faith must be observed by the contracting parties and the good faith forbids either party from non-disclosure of the facts which the parties know.  ………..”

11.    In Revision Petition No.967 of 2008, Life Insurance Corporation of India versus Smt. Neelam Sharma, decided on September 30^th, 2014, Hon’ble National Commission observed as under:-

“8.       In Satwant Kaur Sandhu vs. New India Assurance Company Ltd. (2009) 8 SCC 316, it has been observed by the Supreme Court that the expression “material fact” is to be understood in general terms to mean as any fact which would influence the judgment of a prudent Insurer, in deciding whether to accept the risk or not.  If the proposer has knowledge of such fact, he is obliged to disclose it particularly while answering questions in the proposal form.  Any inaccurate answer will entitle the Insurer to repudiate their 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, which is based on the principle of utmost faith –uberrima fides.  Good faith forbids either party from non-disclosure of the facts which the party privately knows, to draw the other into a bargain, from his ignorance of that fact and his believing the contrary. (See: United India Insurance Co. Ltd. Vs. M.K.J. Corporation [(1996) 6 SCC 428].  It has also been emphasized that it is not for the proposer to determine whether the information sought for is material for the purpose of the policy or not. Of course, obligation to disclose extends only to facts which are known to the applicant and not to what he ought to have known.”

“11.     Having given our anxious consideration to the material on record, we are of the opinion that the answers given by the Insured in the proposal form were untrue to his knowledge. There was clear suppression of “material facts” in regard to the health of the Insured.  It was not for the Insured to determine whether the information sought for in the aforesaid questionnaire was material for the purpose of the two policies…..”  

12.              From the medical record, it is established that insured was suffering Moya Moya disease and was not having good health prior to the purchasing of the Insurance Policies and the complainant suppressed this fact in his statement (Annexure-A1 and A2) made at the time of obtaining the policies.  So, in view of the law enunciated above, this Commission is of opinion that Bajaj Allianz was justified in repudiating the claim of the complainant.  The District Forum fell in error in allowing the complaint.

13.    Hence, the appeal is accepted, the impugned order is set aside and the complaint is dismissed.

14.    The statutory amount of Rs.25,000/- deposited at the time of filing the appeal and Rs.4,68,225/- deposited on 23.10.2015 as per direction be refunded to the appellant against proper receipt and identification in accordance with rules, after the expiry of period of appeal/revision, if any.

 

Announced 05.07.2016

(Diwan Singh Chauhan) Member

(B.M. Bedi) Judicial Member

(Nawab Singh) President

CL