DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, BATHINDA CC.No.185 of 05-05-2011 Decided on 19-09-2011
Urmila Kapil, aged about 50 years, wife of Padam Kapil, R/o 34/34, near Guru Nanak Park, Rampura Phul, District Bathinda. .......Complainant Versus
Reliance Life Insurance Company Limited, Anil Dhirubhai Ambani Group, Registered Office: H Block, Ist Floor, Dhirubai Ambani Knowledge City, Navi Mumbai, Maharashtra-400710, through its Managing Director. Branch Manager, Reliance Life Insurance Company Limited, Sukhdev Singh Ahluwalia Complex, Ground Floor, Hazi Ratan Chowk, Bathinda-151001, Punjab. Balkrishan, Resident of Calcutte Wali Gali, near Jai Tulsi Public School, Nabha Mandi, Rampura Phul, District Bathinda. Mohit Kumar son of Ashok Kumar, Resident of Aggarwal Colony, Gidderbaha. (Deleted)
......Opposite parties
Complaint under Section 12 of the Consumer Protection Act, 1986.
QUORUM
Smt. Vikramjit Kaur Soni, President Sh.Amarjeet Paul, Member Smt. Sukhwinder Kaur, Member Present:- For the Complainant: Sh. K.S.Sidhu, counsel for the complainant. For Opposite parties: Sh. Sanjay Goyal, counsel for opposite party Nos.1&2 Sh. Dinesh Garg, counsel for opposite party No.3 Opposite party No.4 deleted
ORDER
Vikramjit Kaur Soni, President:-
1. The present complaint has been filed by the complainant under Section 12 of the Consumer Protection Act, 1986 as amended up-to-date (Here-in-after referred to as an 'Act'). The brief facts of the complaint are that on the allurement of the opposite party No.3 on behalf of opposite party No.1, the husband of the complainant under bona fide belief, had purchased insurance policy bearing No.15228744 on 14.09.2009 for a sum of Rs.50,000/- on the basis of payment of annual premium of Rs.5,000/-. The husband of the complainant deposited the amount of Rs.5,000/- as premium vide cheque No.542941 dated 14.09.2009 drawn on Punjab National Bank and the opposite party No.3 got completed all documentation from the husband of the complainant and obtained his signatures. Padam Kapil, the husband of the complainant died on 02.02.2010 due to short illness. The complainant being first nominee, lodged a claim application for claiming the insured amount on account of death of her husband and deposited all the necessary documents with the officials of the opposite party No.1. In this regard, the complainant received a letter dated 30.04.2010 from the opposite party No.2 who mentioned in this letter that the life insured had given false answers to the questions put in Proposal Form dated 14.09.2009, signed by the deceased insured and before taking the above said policy, he had suffered from shortness of breath and anemic on 30.01.2009 for which he was admitted in hospital. The complainant has alleged that before purchasing the above said policy by her husband, the opposite party No.3 has filled up the proposal Form and had given response to the questions without consulting husband of the complainant. It is the duty of Insurance Company and its agent to get the medical examination of life insured to rule out that the life insured is suffering form any disease but it has become a practice for the agent as well as of insurance company itself to sell insurance policy by showing green pastures to unsuspecting persons and to deny the claim of deceased life insured to his/her nominee by blaming the deceased. The complainant also approached the office of Insurance Ombudsman, SCO 101-103, Batra Building, 2nd Floor, Sector 17-D, Chandigarh and submitted relevant Forms with full particulars in the month of August 2010 but till date, nothing has been heard from them. The complainant also got served a legal notice through registered post on 21.12.2010 to the opposite parties but to no effect. Hence, the complainant has filed the present complaint. 2. The opposite party Nos.1&2 have filed their joint separate written statement and pleaded that the complainant was suppressed the material facts and it is settled legal proposition that “one who seeks justice must come to the Court with his clean hands”. The present complaint is in breach of the pious relationship of Uberrima Fides between the insurer and the insured. If the claimant or the proposer has concealed the material facts in the proposal Form, the claim should be repudiated by the insurer. For this, the opposite party Nos.1&2 have taken the support of law laid down by Hon'ble National Consumer Disputes Redressal Commission in case titled Dineshbhai Chandrana Vs. LIC & Anr., First Appeal No.242/2006, decided on 27.07.2006. The contract of insurance is based on trust that the person who obtains insurance policy, is required to inform the complete details pertaining to his/her health including the life style as the same would have an affect on the decision of the insurer to issue the insurance policy. So, any policy obtained by concealing material facts, would have been obtained by misrepresentation and fraud and as such, the contract is null and void. The opposite parties have rightly repudiated the claim of the complainant. As per Sections 17, 18 & 19 of the Contract Act, the claim of the complainant was rightly repudiated by the opposite parties. The opposite party Nos.1&2 have further pleaded that Mr. Padam Kapil i.e. deceased Life Assured had submitted an application for insurance bearing No.9033958 dated 14.09.2009 proposing for issuance of Reliance Super Invest Assure Basic Plan in his own name for an annual premium of Rs.5,000/- and sum assured of Rs.25,000/-. The Insured opted for yearly payment of premium. On the receipt of the said Application Form and required documents, a policy bearing No.15228744 was issued to the insured with risk commencement date as 15.09.2009 and the same was delivered to the life assured. The opposite party Nos.1&2 have further pleaded that even for many queries, the Life Assured had answered “NO” whereas the disease which he had succumbed to could not occur overnight. As per information, the life assured died on 02.02.2010 i.e. within five months from the date of issuance of the policy. The complainant approached the opposite parties being the nominee of the life insured for the release of the amount against the said policy secured by him claiming that the death of the deceased was due to short illness. On receipt of information regarding the death of the life insured, the opposite party Nos.1&2 appointed Investigator to investigate into the claim of the complainant and authorized him to collect all the relevant documents pertaining to the case from the Hospital, Police Authorities and Govt. Departments etc. As per investigation of the Investigator, the Life Assured was hospitalized on 30.01.2009 for shortness of breath and anemic. The Life Assured has concealed this fact at the time of purchasing the above said policy. As per settled law, the contract of insurance is based on the principle of “Uberrima Fides” i.e. the relationship of utmost trust and faith between the insurer and the insured. On the basis of investigation report, the opposite parties rightly repudiated the claim of the complainant and intimated to the complainant in this regard vide letter dated 30.04.2010, giving all details/reasons/grounds for repudiation of the claim. Further, the opposite party Nos.1&2 as a goodwill gesture, have refunded the fund value of Rs.498.85 as on the date of death of the life assured. The opposite party Nos.1&2 have taken into consideration the provisions of Section 45 of the Insurance Act, 1938 at the time of taking the decision of repudiating the claim under the said policy. 3. The opposite party No.3 has filed its separate written statement and pleaded that he never approached the husband of the complainant for purchasing the insurance policy. The opposite party No.3 is neither an insurance agent nor sells the insurance policies. The opposite party No.3 has not received any legal notice from the complainant. 4. Parties have led their evidence in support of their respective pleadings. 5. Arguments heard. Record alongwith written submissions submitted by the parties perused. 6. The complainant has alleged that the opposite party No.3 approached the husband of the complainant-Padam Kapil for purchase of the policy of the opposite party No.1. Under the bona fide belief, the husband of the complainant had purchased insurance policy bearing No.15228744 on 14.09.2009 for a sum of Rs.50,000/- on the basis of payment of annual premium of Rs.5,000/-. Padam Kapil, husband of the complainant deposited the amount of Rs.5,000/- as premium vide cheque No.542941 dated 14.09.2009 drawn on Punjab National Bank for the amount of Rs.5,000/- and the opposite party No.3 completed all the formalities and obtained the signatures of the husband of the complainant. The husband of the complainant died on 02.02.2010 due to short illness and thereafter, the complainant being a first nominee, lodged a claim application for claiming the insured amount on account of death of her husband and deposited all the necessary documents with the opposite party No.1. In response to her claim application, she received a letter dated 30.04.2010 from the opposite party No.2 in which they have mentioned that the Life Insured has given false answers of the questions in Proposal Form, signed by the deceased Life Assured as he had suffered from shortness of breath and anemic on 30.01.2009 for which he was hospitalized. The complainant has submitted that it is the duty of Insurance Company and its agent to get the medical examination of life insured to rule out that the life insured is suffering form any disease but it has become a practice for the agent of insurance company and insurance company itself to sell insurance policy by showing green pastures to unsuspecting persons and to deny the claim of deceased life insured to his/her nominee by blaming the deceased. The complainant had also approached the office of Insurance Ombudsman, SCO 101-103, Batra Building, 2nd Floor, Sector 17-D, Chandigarh and submitted relevant Forms with full particulars in the month of August 2010 but till date, nothing has been heard from them. 7. The opposite party Nos.1&2 have submitted that “one who seeks must come to the Court with his clean hands”. The deceased life assured has concealed the material facts in the Proposal Form. The claim should be repudiated by the insurer as the same has been held by the Hon'ble National Consumer Disputes Redressal Commission in case titled Dineshbhai Chandrana Vs. LIC & Anr., First Appeal No.242/2006, decided on 27.07.2006. The Insured at the time of filling up the Proposal Form, mis-stated the material facts which were well within his knowledge, which might be disclosed to the insurer then the insurer is well within his rights to repudiate the claims of insured and as such, the insurer has a right to repudiate the claim of the complainant under Section 45 of the Insurance Act, 1938. Accordingly, the claim of the claimant was rejected. The contract of insurance is based on trust i.e. a person who obtains insurance, is required to inform the complete details pertaining to his/her health including the life style as the same would have an affect on the decision of the insurer to issue the insurance policy and therefore, any policy obtained by concealing material facts, would have been obtained by misrepresentation and fraud and as such, the contract is null and void and the opposite parties have right to repudiate the claim of the complainant. The opposite party Nos.1&2 have relied upon various authorities to support their version. In para no.12 of their written statement on preliminary objections submitted that non disclosure amounts to fraud and the opposite parties cannot take the benefit of its own wrongs. The opposite parties have referred the Sections 17, 18 & 19 of the Contract Act. The opposite party Nos.1&2 have further submitted that Padam Kapil, the deceased life assured had submitted an application for insurance bearing No.9033958 dated 14.09.2009 proposing for issuance of Reliance Super Invest Assure Basic Plan in his own name for an annual premium of Rs.5,000/- and sum assured of Rs.25,000/-. The Insured opted for yearly payment of premium. On the receipt of the said Application Form and required documents, a policy bearing No.15228744 was issued to the insured with risk commencement from dated 15.09.2009. 8. The Life Insured had answered to the questions regarding his health as “NO”. The Life Assured died on 02.02.2010 i.e. approximately within five months from the date of insurance of the policy. The complainant approached the opposite parties being the nominee of the life assured for the release of the amount against the said policy secured by him and deposited all the necessary documents. On receipt of information, regarding the death of the life assured, the opposite parties appointed Investigator to investigate into the claim of the complainant. The Insurance Company authorized the Investigator to collect all the relevant documents pertaining to the case from the Hospital, Police Authorities and Govt. Departments etc., the matter was throughly investigated by the said Investigator and it was revealed that the Life Assured was hospitalized on 30.01.2009 for shortness of breath and anemic. The aforesaid deliberate misrepresentation by the policy holder at the time of taking the policy amounts to misrepresentation and fraud. It is settled law, the contract of insurance is based on the principle of “Uberrima Fides” i.e. the relationship of utmost trust and faith between the insurer and the insured and any misrepresentation or concealment of material facts by the policy holder disentitles any claim on the basis of such policy as the policy holder did not disclose the correct facts willfully and deliberately to cause wrongful gain to his heirs/nominee and wrongful loss to the opposite parties. The opposite parties rightly repudiated the claim of the complainant and intimated to the complainant in this regard vide letter dated 30.04.2010, giving all details/ reasons/grounds for repudiation of the claim. The opposite parties as a goodwill gesture have refunded the fund value of Rs.498.85 as on the date of death of the life assured. As per the provisions of Section 45 of the Insurance Act, 1938 which are read as under:- “No policy of life insurance effected before the commencement of this Act shall after the expiry of two years from the date of commencement of this Act and no policy of life insurance effected after the coming into force of this Act shall after expiry of two years from the date of which it was effected, be called in question by an insurer on the ground that a statement made in the proposal for issuance or in any report of a medical officer, or referee or friend of the insured or any other document leading to the issue of the policy, was inaccurate or false, unless the insurer shows that such statement was on a material matter or suppressed facts which it was material to disclose and that it was fraudulently made by the policyholder and that the policyholder knew at the time of making it that the statement was false or that it suppressed facts which it was material to disclose.” The Hon'ble Apex Court of India in catenia of judgments had taken pain to laid down that the contract of insurance is based on the maxim “Uberrima Fides” 9. The complainant has averred that her husband had purchased insurance policy bearing No.15228744 on 14.09.2009 for a sum of Rs.50,000/- on the basis of payment of annual premium of Rs.5,000/- on the allurement of the opposite party No.3. The opposite party No.3 has specifically denied that he has neither approached the husband of the complainant for purchase the policy nor he sells the insurance policies. 10. The Life Assured-Padam Kapil died on 02.02.2010 due to shortness of illness and the complainant had filed the claim but her claim was repudiated on the ground that the false answers have been given in the Proposal Form by the Life Insured. Further, the complainant has also submitted that the weight of her husband was 70 Kg whereas the actual weight of the husband of the complainant was 29 Kg only. 11. The Repudiation letter Ex.C-7 shows that the deceased life assured has given wrong answers to the few questions. After receipt of the claim request from the claimant, the opposite parties have appointed the surveyor to survey into the matter. The surveyor has inspected the matter and found that the answers of the few questions in the Proposal Form were incorrect. The relevant portion of letter Ex.C-7 is reproduced as under:- “On investigation and from medical documents, we understand that late Mr. Padam Kapil was hospitalized on 30.01.2009 before proposal for shortness of breathe and anemic. Late Mr. Padam Kapil submitted proposal for insurance on 14.09.2009, the relevant questions in the proposal Form and answers provided by him are reproduced below:- Question 30: Are you currently taking any medication or drugs, other than minor condition, (eg. Cold and flu), either prescribed by a doctor, or have you suffered from any illness, disorder, disability or injury during the past 5 years which has required any form of medical or specialized examination (including chest x rays, gynecological investigation, pap smear or blood tests.) consultation, hospitalization or surgery? Answer: No Question 32: Do you suffer from any medical ailments such as: diabetes, high blood pressure, cancer, respiratory disease (including asthma), kidney or Liver disease, Stroke, any blood disorder. Heart problems, Hepatitis or Tuberculosis, Psychiatric Disorder, Depression, HIV, AIDS, or a related infection? Answer: No The non disclosure of heart problem was material to the issuance of the policy and ought to have been disclosed in the proposal Form. By not doing so, the Proponent had misled us to grant his insurance cover on the terms as stated in the policy schedule. In the light of the above facts and the irrefutable evidence, we hold that we were provided with false and inaccurate answers, we are constrained to repudiate the claim under the policy in terms of Section 45 of the Insurance Act, 1938. According to our policy conditions, all claim benefit shall cease and all monies that have been paid will be forfeited to us. But as a goodwill gesture, we are pleased to inform you that the fund balance of Rs.498.85 is being paid. Our branch officials will personally hand over the cheque to you. Details of the payment are mentioned below: Sum Assured | 25000 |
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Contribution | 5000 | Fund Value | 498.85 | PAYABLE CLAIM AMOUNT | 498.85 |
The fund value according to above said table, has been paid by the opposite parties to the complainant to the tune of Rs.498.85. 12. The husband of the complainant has concealed the material facts regarding his health. The Medical summary Ex.R-4 shows that the complainant has admitted in the Hospital of Garg Nursing Home, Bathinda on 30.01.2009 at 2.00 PM. According to this summary and progress report which is reproduced as under:- “Patient Mr. Padam Kapil, 58 years/M; R/o Rampura Phul, admitted in the nursing home on 30.01.2009 and chief complaint of Dyspnoea on minimal exertion for last one month along with cough expectoration for last four days. H/o Present illness:- Patient presented with Dyspnoea on minimal exertion for last one month alongwith cough with white expectoration for last four days. Urine out put and bowel habits are normal. Patient denied any H/o Fever, Chest pain, Hemophysis but occasional C/o Palpitations Past History:- No H/o HIV & DM Personal History:- Sobor G/P Examination:- B.P. - 110/70 Pulse – 120/min. Temp – 98 Clinically there is evidence of Anaemia but no evidence of Jaundice.” Thereafter, the husband of the complainant remained under the treatment from 30.01.2009 to 06.02.2009. On 06.02.2009 the summary is recorded as under:- “Patient is comfortable. Dyspnoea got reduced, Urine output and bowel habits also normal. No other fresh complaint.” 13. This shows that the husband of the complainant has been suffering from chest infection and remained under the treatment at Garg Nursing Home, Bathinda. The claim has been repudiated for non disclosure of the health problems. The legal notice sent by the complainant, was duly replied by the opposite parties vide Ex.R-6 in which, they have mentioned as under:- “1. Please accept our heartfelt condolences on the early demise of Padam Kapil. We state that Late Shri Padam Kapil deceased husband of you, had availed Reliance Super Invest Assure Plan bearing policy number “15228744” by paying the yearly premium of Rs.5,000/- (Rupees Five Thousand Only) with Risk Commencement Date of September 15, 2009 for a sum assured of Rs.25,000/- for 15 years of policy and premium payment duration. We state that the cause of death as intimated by you was due to heart attack. However, on investigation, we found out that deceased life assured was suffering with shortness of breath and anemic, which was prevalent at the time of availing the aforementioned policy from us. We further state that the life assured while filling up the proposal Forum for availing the said policy had mentioned that his weight as 70 kg against the actual weight of 29 kg. On investigation, we also found that life assured was hospitalized during the period of January 30, 2009 to February 6, 2009 for diagnosis and treatment of his ailment, which was also not disclosed to us. Hence, the non-disclosure of the same amounts to material concealment of facts, hence the claim under the policy is liable to be repudiated in terms of the provisions of Section 45 of the Insurance Act, 1938. The same has been communicated to you through our letter dated April 30, 2010 and as a goodwill gesture, we had paid back the remaining fund value to you amounting to Rs.498.85 against aforesaid policy. Therefore, in light of the above said the claim and the contents of your notice under reply are false and vexations, hence denied in entirely. 2. Hence, in light of the above cited reasons the contents of your notice sent to us are frivolous in nature and the claim of your is illegal and unjust, thus rejected.” 14. Therefore, in view of what has been discussed above, this Forum concludes that the opposite have rightly repudiated the claim of the complainant as at the time of taking Insurance Policy, the husband of the complainant has concealed and misrepresented regarding his health. The support can be sought by the law laid down by the Hon'ble National Consumer Disputes Redressal Commission, New Delhi in case titled Smt. Vidya Devi etc. Vs Life Insurance Corporation of India, 2002(I) CPC 159, wherein, it has been held that:- “Consumer Protection Act, 1986 – Section 14 – Insurance Policy – Concealment of disease – Two Double Benefit Life policies obtained by assured in favour of his wife and mother respectively within a short span of 3 months – Actual disease was not disclosed by deceased assured who died within one month of taking the policies – Wife and mother of insured deceased claimed the Insurance amount after his death which were repudiated by Insurance Company – Repudiation upheld – National Commission committed no illegality in the impugned order.” Further the support can be sought by the law laid down by the Hon'ble National Consumer Disputes Redressal Commission, New Delhi in case titled LIC of India & Anr. Vs. Naveen Dhingra, 2003(2) CPC 285, wherein, it has been held that:- “Claim was repudiated as insured deceased had suppressed information about liver disease he was suffering from when policy were revived – State Commission allowed the claim in view of S.45 of Insurance Act – Provisions of S.45 of the Act not attracted – Deceased had suppressed the information of ailment – Repudiation of claim justified – Order of State Commission set aside.” Further, the Reliance can be put on by the Hon'ble State Consumer Disputes Redressal Commission, Chhattisgarh, Raipur in case titled Life Insurance Corporation of India Vs. Smt. Parvati Gond and Another, 2004(1) CPC 452, wherein, it has been held that:- “Consumer Protection Act, 1986 – Sections 14 and 15 – Insurance claim – Concealment of material fact – Before revival of policy it was in full knowledge that insured was suffering from cirrhosis of liver and hypertension – Death occurred within one month after revival of policy – Wilful suppression of material fact well established – Repudiation justified – Order of District Forum accepting claim of Rs.50,000/- set aside.” Further, the support can be sought by the precedent laid down by the Hon'ble Punjab State Consumer Disputes Redressal Commission, Chandigarh in case titled Life Insurance Corporation of India & Ors. Vs. Sharda Devi, 2009(1) CPC 527, wherein, it has been held that:- “Consumer Protection Act, 1986 – Sections 2(1)(g) & 15 – Concealment of disease – Insurance – Merely that doctor had not noticed any disease of insured at the time of filling up of proposal form or he had given a good health report does not mean that insured was not suffering from any disease – Sometimes, disease is lying hidden in the body which cannot be known by the doctor but it is in the knowledge of insured – In the instant case, insured had concealed fact of disease during two policies out of 3 policies obtained in the year 1994, 1997 and 1998 respectively – As material fact of disease was suppressed in policies in the year 1997 and 1998 – Claim for these policies rightly repudiated – Claim for 1997 policies accepted with 9% interest – Impugned order modified.” Further, the support can be sought by the law laid down by the Hon'ble National Consumer Disputes Redressal Commission, New Delhi in case titled Goparatnam & Ors. Vs. LIC of India & Ors., 2006(1) CPC 364, wherein, it has been held that:- “Consumer Protection Act, 1986 – Sections 21(b) & 14 – Insurance claim – Suppression of fact – Claim was repudiated on the ground that the deceased had suppressed the information about his ailments like typhoid breaching the terms of the policy – Contract of insurance is entered between the parties – Violation of terms of contract by any party ousts its claim against other – Repudiation of claim upheld.” Further, the support can be sought by the law laid down by the Hon'ble National Consumer Disputes Redressal Commission, Circuit Bench at Pune in case titled Shanti Lal Swaroopchand Soni Vs. New India Assurance Company Ltd., 2008(3) CPC 304, wherein, it has been held that:- “Consumer Protection Act, 1986 – Section 21(b) – Medi-claim policy – Repudiation of claim by Insurance Company on the ground that petitioner had willfully concealed material facts about his pre-existing ailment at the time of policy and its renewal – Insured suffering from number of diseases for past several years – Contract of insurance is based on utmost bonafide faith which petitioner had not stood up at the time of taking policy – Complainant – Petitioner not approached consumer Fora with clean hands – Finding reached by Fora below not suffering from any illegality or jurisdictional error – Repudiation of claim justified – No relief entitled.” 15. Hence, this Forum concludes that there is no deficiency in service on the part of the opposite parties. Therefore, this complaint is dismissed without any order as to cost. A copy of this order be sent to the parties concerned free of cost and file be consigned for record. ' Pronounced in open Forum 19-09-2011 (Vikramjit Kaur Soni) President
(Amarjeet Paul) Member
(Sukhwinder Kaur) Member
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