ORDER

SH. RAKESH KAPOOR, PRESIDENT

The  husband of the the claimant namely Late Sh.  Satpal was holder of a life insurance policy from the OP .  He had expired on 2.2.2012 at Guru Teg Bahadur Hospital ,Shadhara. Complainant no. 1, being the nominee under the said policy ,had preferred a claim with the OP under the said policy  which was repudiated .  Hence, the complaint.

    The OP has contested the complaint and has filed a written statement. It has denied any deficiency in service on its part and has claimed that the complaint is liable to be dismissed as it has no merits.   The OP has admitted that it had issued a life insurance  policy in favour of the deceased on 22.6.2011.  The OP has , however, justified its act of repudiation of the claim on the ground that the insured had made a misstatement about the  state of his health at the time of entering into the insurance contract.   It has , therefore, claimed that the complaint has no merits and is liable to be dismissed.  It has prayed accordingly.

    We have heard arguments advanced at the bar and have perused the record.

   In United India Insurance Co. Ltd. Vs. M.K. Corporation,III(1996)CPJ8(SC),the Hon’ble Supreme Court held as under :-

“It is a fundamental principle of Insurance Law that utmost good faith must be observed by the contracting parties.  Good faith forbids either party from concealing (non disclosure) what he privately knows, to draw the other into a bargain, from his ignorance of that fact and his believing the contrary.  Just as the insured has a duty to disclose, ”Similarly, it is the duty of the insurers and their agents to disclose all material facts within their knowledge since obligation of good faith applies to them equally with the assured.

The duty of good faith is a continuing nature.  After the completion of the contract, no material alteration can be made in its terms except by mutual consent.

    The learned counsel for the OP has drawn our attention to a copy of the proposal form placed on record on the basis of which the insurance policy was granted to the insured. Our attention has also been drawn to Column 13 under the head “Medical and Other Details of the Life to be assured” wherein the insured was specifically asked as to whether he was suffering from or had suffered or undergone investigation in the past or has been advised to undergo investigation or treatment for lever disease (jaundice/ Hepatitis) etc.   The answer to this  question was given in the negative by the insured. Our attention has also been drawn to the investigation conducted in this case  which shows that the deceased was suffering from Hepatomegaly  with cholelitheasis on 12.4.2011 and was taking treatment at Mavi Nursing Home.  He had also undergone tests on 14.4.2011 and 15.4.2011 at Yashoda Diagnostic Center.   The insurance policy was effective  from  1.7.2011 and was purchased  without disclosing the aforesaid facts . We are, therefore, convinced that the insured had made a misstatement about the state of his heath at the time of purchase of the insurance policy from the OP .  He had not disclosed the fact that he was suffering from an enlarged lever and had stones in the Gall bladder. We , therefore, hold that in the facts and circumstances of the case, the OP was justified in repudiating the claim lodged by the complainants.  We , see no merits in this complaint.  The same is hereby dismissed. 

Copy of the order be made available to the parties as per rule.  File be consigned to record room.

    Announced in open sitting of the Forum on.....................