DISTRICT CONSUMER DISPUTES REDRESSAL FORUM-II

Udyog Sadan, C-22 & 23, Qutub Institutional Area

(Behind Qutub Hotel), New Delhi-110016

Case No.126/2016

Smt. Dhamanjeet Kaur

W/o Late Sh. Parvinder Pal Singh

6/11, Double Story, Jangpura Extn.,

Birbal Park, South,

New Delhi-110014                                                            ….Complainant

Versus

Reliance Life Insurance Company Ltd.

Branch Division, Lajpat Nagar,

New Delhi

Also at:

Registered office,

1^st Floor, Dhirubhai Ambani Knowledge City,

Navi Mumbai, Maharashtra-400710                            ….Opposite Party

                                                  Date of Institution        : 02.05.16       Date of Order               : 06.10.18   

Coram:

Sh. R.S. Bagri, President

Ms. Kiran Kaushal, Member

ORDER

Member - Kiran Kaushal

Facts of the case in nutshell are:

1. Sh.  Parminder Pal Singh (husband of the complainant)  purchased a Life Insurance policy of the OP Company under reliance guaranteed money back plan for a term of 20 years commencing from 13.06.14 for the assured sum of Rs.6,53,633/- vide policy no.  5167236. The mode of
   
   premium was yearly payment of Rs.49999.68p. The annual premium for the year 2014-2015 was paid on 26.05.14 and the next premium was due on 13.06.15.
   1. On 31.03.15 the complainant’s husband i.e. the insured or policyholder unfortunately got a serious heart attack at the age of 41 years. He was immediately taken to the Moolchand City hospital, Lajpat Nagar wherein he was declared brought dead. It is further stated that the postmortem of the said deceased was done at Deptt. of Forensic Medicines and Toxicology, AIIIMS, New Delhi-110029 vide post mortem report No 354-15.
   2. The complainant averred that the insured had never undergone any medical test before his death nor was he aware of any kind of illness. It is stated that the insured had no medical complication at the time of purchase of insurance policy or even before his sudden death. After the death of the insured, complainant who is widow of the said deceased/ insured applied for the death claim from the Insurance Company (OP) on 06.05.15.  The complainant submitted the requisite documents and information with the OP.   It is stated that thereafter the complainant received a letter dated 27^th June, 2015 from the respondents wherein the claim was repudiated stating “that on the review and documents collected during investigation of your claim, we understand that Late Mr. Parvinder Pal Singh was suffering from Diabetes & Hypertension since last 2 years & was taking treatment for the same and that non-disclosure of above illness was material to the insurance of the policy and ought to have been disclosed in the proposal form. By not doing so the proponent has misled us to grant insurance cover on the terms as stated in the policy schedule. According to our policy conditions, all claims benefits shall cease and all the premium will be forfeited by us.”
   3. Since the repudiation of the claim of the legal heir of the deceased was totally unjustified, the complainant approached this forum with the prayer to direct the OP to reimburse the claim amount of Rs.6,53,633/-, to pay Rs.2 lacs towards the compensation for causing mental torture and harassment and to pay the cost of litigation.
2. OP resisted the complaint by filing the written statement stating that the present complaint is an afterthought to undue enrichment.  It is further stated that the contract of insurance is a contract biased on “uberrimae fidei” i.e. utmost good faith. The person seeking insurance is under an obligation to make of full and honest disclosure of the fact and material to the insurer at the time of the proposal.

2.1.   The OP averred that on the receipt of claim intimation from the complainant   wherein it was informed that the husband of the complainant Late Mr. Parvinder Pal Singh, had expired on 31.03.2015 and the complainant claimed the sum insured of the said policy. OP as per norms had sent the claim to the investigating agency, namely, paramount. Consultancy Services.  It was on the basis of the documents received from the complainant and the investigating report OP was convinced that the life assured was suffering from diabetics and hypertension. It is further stated that on the basis of documents i.e. medical attendance certificate (Claim Form B) and the post mortem report under the heading additional remarks clearly stated that “the deceased had consumed alcohol the previous night. The deceased was a known case of diabetic and hypertension.” 

2.2    The OP repudiated the clam on 27.06.15 on the ground of suppression of material fact i.e. pre-existing disease and hospitalization by the life assured while filing up the proposal form based on which the said policy was issued. It is submitted that there has been a willful concealment of the vital information at the time of filing up the proposal form by the life assured which amounts to material non-disclosure.

2.3    OP alleges that the life insured was a known diabetic prior to date of proposal form was not disclosed in the application/proposal form signed by the insured.  For reference below are the reproduction of the aforesaid question and replies thereto in the application of the insurance:-

2.4    Thus, it is stated that if the insured at the time of filing up the proposal form mis-stated the material facts which were well within his knowledge, which might have been disclosed to the insurer then the insurer is well within his right to repudiate the claim of the insured, hence the complaint is liable to be rejected with exemplary cost.

3.      Rejoinder and evidence by way of affidavit were filed by the complainant controverting the written statement and reiterating the facts stated in the complaint. The complainant   has annexed the following documents to support his case:-

1. Application No.D648744B for Reliance Life Insurance Policy.
2. Photocopy of the emergency registration certificate dated 15.03.2011 issued by Moolchand Hospital
3. Photocopy of the postmortem report of the Department of Forensic Medicine and Toxicology, AIIMS, New Delhi.
4. Photocopy of death certificate of the insured Sh. Parminder Pal Singh.
5. Photocopy of the pay-out form for death claim.
6. Photocopy of the letter of repudiation dated 27.06.2015..

4.      Evidence by way of affidavit has been filed by Sh. Naresh Verma, Executive Territory Manager on behalf of the OP.

5.      Written arguments have been filed by the parties.

6. After having heard the arguments of Ld. counsels of the parties and perusing the record it is observed that it is an admitted fact that Sh. Parvinder Pal Singh husband of the complainant purchased a life insurance policy of the OP under ‘Reliance Guaranteed Money Back Plan’ for a term of 20 years. The annual premium of Rs.49999.68P for the year 2014-2015 was paid on 26.05.14.  On 31.03.15 the insured/policy holder, the husband of the complainant unfortunately got a serious heart attack and was admitted to Moolchand City Hospital, Lajpat Nagar wherein he was declared brought dead. The postmortem of the deceased was done at Deptt. of Forensic Medicines and Toxicology, AIIIMS, New Delhi. The complainant applied for a death claim and submitted the requisite documents and information. The dispute between the parties arose when the complainant received a repudiation letter dated 13.06.15 from the OP.
7. In the light of above discussion we understand that the claim of the complainant has been repudiated by the OP stating “on a review and documents collected during investigation of your claim, we understand that Late Mr. Parvinder Pal Singh was suffering from Diabetes & Hypertension since last 2 years & was taking treatment for the same”. In the name of investigation OP has exhibited medical opinion of Dr. N. V. Apte as Ex. OP-1/6. In the said exhibit the finding of the claims department it is mentioned that the deceased was known case of HTN & DN since two years on Ayurvedic treatment. It is also mentioned that inspite of extensive checks the claims department of the OP had not received any past medical papers.
8. The comments of CMO in the medical opinion are reproduced as under:-

“In this case prior existence of HD & DM has not been disclosed by party at the time of the proposal. SA is larger. With a large SA we would have thoroughly investigated & decided on merits with sizeable ext. (not readable).Very early case; better to repudiate the case.”

9. The finding of claims department in the Medical Opinion is not substantiated by any scientific or medical evidence. Moreover, the comments of CMO that ‘SA (Sum Assured) is large’ and ‘very early case’ seems to be influenced more by financial aspect than the medical opinion.
10. OP further submits that the complainant’s claim was repudiated based on medical attendant certificate (Claim Form B) and Postmortem Report. The post mortem report under the heading additional remark stated that “the deceased had consumed alcohol the previous night. The deceased was a known case of diabetic and hypertension”. Hence, the reason stated by the OP for repudiating the claim is suppression of material fact.
11. On perusal of the Claim Form B the cause of death is clearly stated to be ‘Cardiac Arrest’.  The postmortem report also does not repose confidence of the Forum, as in the general description of the abdomen no abnormal smell has been deducted which is contrary to the additional remark that the deceased had consumed alcohol previous night.  Additionally the cause of death is still kept pending till toxicological analysis of Viscera is made available by FSL/CFSL.  Further the post mortem report is signed by only a Junior Resident. Even if we believe the OP that the deceased was a known case of diabetes and hypertension, it was for the OP to investigate and seek medical opinion before selling the insurance policy to the complainant and not after accepting the premium or on filing of the death claim by the complainant. Moreover, diabetes and hypertension are life style disease and not life threatening diseases.
12. Therefore, this Forum is the opinion that the OP is guilty of deficiency in service. Hence, we allow the complaint and direct the OP to pay Rs.6,53,633/- to the complainant alongwith the interest @ 6% per annum from the date of filing of the claim till realization. Additionally OP is directed to pay Rs.20,000/- as compensation towards mental agony, harassment and litigation expenses within two months from the date of receipt of copy of this order.

Failing which the OP shall become liable to pay interest @ 9% per annum on Rs.6,53,633/- to the complainant from the date of filing of the claim till realization

Let a copy of this order be sent to the parties as per regulation 21 of the Consumer Protection Regulations. Thereafter file be consigned to record room.

Announced on 06.10.18.