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 Arun Bajaj husband of the complainant during his life time had availed housing loan from State Bank of Bikaner & Jaipur, Ludhiana and in order to secure the said loan facility by the Opposite Parties, he was insured under RIN Raksha Home Loan policy bearing No. 7000001401 against premium on 23.10.2015 by securing the house loan amounting to Rs.12 lakhs. Further alleges that during the policy period, Arun Bajaj husband of the complainant died on 12.01.2016 as a natural death. Thereafter, the complainant being nominee of deceased lodged a claim with the Opposite Parties as per the policy, but the Opposite Parties repudiated the claim of the complainant vide letter dated 06.04.2016 on the ground of pre –existing disease and returned the amount of Rs.6636/- vide cheque dated 31.03.2016. Said act and conduct of the Opposite Parties is totally uncalled for. The husband of the complainant not died on account of any alleged ailment nor he was having any pre existing disease 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) Opposite Parties may be directed to pay Rs.18,36,600/- to the complainant and also to pay any other relief to which this District Consumer Commission may deem fit.
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 deceased life assured had availed loan from State Bank of Bikaner and Jaipur, Ludhiana and had secured the housing loan facility by purchasing policy with risk commenced on 23.10.2015 for a sum assured of Rs.12,37,830/-, but deceased life assured Arun Bajaj committed a breach of principle of Utmost Good faith by suppressing the material fact that he was suffering from Heart Disease prior to the date of commencement of risk and hence after due application of mind, the claim of the complainant was repudiated and the complaint is not maintainable and the same is liable to be dismissed. On merits, Opposite Parties took up the same and similar pleas as taken up by them in the preliminary objections. Hence, Opposite Parties have rightly repudiated the claim of the complainant after application of mind and the complaint may be dismissed with costs.
4. In order to prove her case, the complainant has tendered into evidence the affidavit Ex.CA alongwith copies of documents Ex.C1 to Ex.C3 and closed the evidence on behalf of the complainant.
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.R7 and closed the evidence.
6. We have heard the ld.counsel for the parties and also gone through the documents placed on record.
7. Ld.counsel for the Complainants as well as ld.counsel for the Opposite Parties No.1 and 2 has mainly reiterated the facts as narrated in the complaint as well as in their written statement respectively. We have perused the rival contention of the ld.counsel for the parties. The case of the complainant is after the death of her husband, the complainant being his nominee has filed the claim for the insurance amount with the Opposite Parties, but the Opposite Parties repudiated the claim of the complainant on the false and frivolous allegations of Pre Existing Diseases of the deceased life assured. On the other hand, ld.counsel for the Opposite Parties has repelled the aforesaid contention of the ld.counsel for the complainant on the ground that undisputedly, deceased life assured Arun Bajaj (husband of the complainant) had availed loan from State Bank of Bikaner and Jaipur, Ludhiana and had secured the housing loan facility by purchasing policy with risk commenced on 23.10.2015 for a sum assured of Rs.12,37,830/-, but deceased life assured Arun Bajaj committed a breach of principle of Utmost Good faith by suppressing the material fact that he was suffering from Heart Disease prior to the date of commencement of risk and hence after due application of mind, the claim of the complainant was repudiated. But we do not agree with the aforesaid contention of the Opposite Parties because to prove the alleged factum of concealment of pre existing diseases by the deceased life assured Arun Bajaj (husband of the complainant), the onus to establish this fact is upon the Opposite Parties in this case. We have perused the copies of medical record placed by Opposite Parties of the treating hospital, but there is neither any affidavit nor complete particulars of the investigator recorded in them. Even the original certificate has not been placed on the record. There is no affidavit of doctor of the treating hospital to establish this fact on the record regarding previous disease of insured. He is a private doctor and not posted in any recognized health institute or government hospital. We are unable to rely upon the above referred investigation report appended with the Photostat copy of medical record of complainant. In the absence of any affidavit of investigator and the affidavit of treating doctor of the hospital, we do not place any reliance upon these documents, as pressed into service by the Opposite Parties in this case. Consequently, we are of this view that Opposite Parties have failed to discharge the onus solemnly laid upon it to prove this fact that life assured was suffering from above pre-existing disease before taking the policy and he deliberately and fraudulently concealed this material fact from Opposite Parties. We, thus, conclude that there is no substantive evidence on the record to prove this fact that life assured was suffering from any disease before she took the insurance policy and she willfully suppressed this fact fraudulently from the Opposite Parties. Moreover, if the life assured was suffering from any diseases prior to issuance of the policy, in question, the same must not have escaped the notice of the empanelled doctors of the Insurance Company. However, no such investigation record has been produced by the opposite parties. In case Bajaj Allianz Life Insurance Co. Ltd. & Ors. Vs. Raj Kumar III (2014) CPJ 221 (NC), it was held by the Hon’ble National Commission that “usually, the authorized doctor of the Insurance Company examines the insured to assess the fitness and after complete satisfaction, the policy is issued. It was held that the Insurance Company wrongly repudiated the claim of the complainant.” However, the Opposite Parties-Insurance Company has not placed on record any evidence that before issuing the policy they ever got medically examined the insured. So the abovesaid law squarely covers the case of the complainant that it was the duty of the insurer to get medically examined while issuing the policy and once the policy was issued the insurer cannot take the plea of pre-existing disease of the insured.
8. It also needs to be mentioned that Section 19 of the General Insurance Business (Nationalization) Act, 1972 states that it shall be the duty of every Insurance Company to carry on general insurance business so as to develop it to the best advantage of the community. The denial of medical expenses reimbursement is utterly arbitrary on the ground that disease in question was pre-existing disease. It is mere an excuse to escape liability and is not bona fide intention of the insurance company. Fairness and non-arbitrariness are considered as two immutable pillars supporting the equity principle, an unshakable threshold of State and public behavior. Any policy in the realm of insurance company should be informed, fair and non-arbitrary. When the insurance policy has exclusions/conditions to repudiate the claim or limit the liability, the same must be specifically brought to the notice of the insured and are required to be got signed to show that such exclusions and conditions have been brought to his/her notice. Recently, our own Hon’ble State Consumer Disputes Redressal Commission, Chandigarh in First Appeal No. 50 of 2019 titled as Bajaj Alliance General Vs. Arjan Singh decided on 04.03.2021 also held so.
9. The need for interpreting a contract always arises in two situations, (i) when a gap is needed to be filled in the contract and (ii) an ambiguity is needed to be resolved in the contract, then to find out correct intention of the contract, spirit behind it is required to be considered. Normally, the insurance policy is a contract of adhesion in which other party is left with hardly any bargaining power as compared to the insurer. Insurance contracts are standard form contracts and are drafted by the insurance company and as such, insurance company is at higher footing than the insured. The benefit of such clause, as exclusion clause, would go to the insured unless the same is explained in clear terms by the insurer. In such circumstances, the tribunal would be more oriented towards the interpretation which goes against the party who has inserted/drafted the disputed clause in the agreement/contract. The adjudicating authority is required to look into whether the intention of the party is to exclude or limit liability has been appropriately explained to the other party or not. This Commission while interpreting insurance agreement is to honour the intention of the parties, who have signed the agreement. Even if the agreement had general exclusion/condition for misrepresentation still fraudulent misrepresentation and non-disclosure may not be there. The innocent and negligent misrepresentations are to be ignored. On the other hand, the rulings (i) Satwant Kaur Sandhu Vs. New India Assurance Company Limited, (ii) Murti Devi Vs. Birla Sun Life Insurance and (iii) Mamohan Nanda Vs. United India Insurance Company Limited, cited by the ld.counsel for the Opposite Parties are not applicable and relevant to the facts of the present case. The insurance companies are in haste to charge the premium, but when the time to pay the insurance claim comes, they generally take up one excuse or the other to avoid their liability. The reliance of counsel for the appellant on law laid down in “Life Insurance Corporation of India Vs. Priya Sharma & others” 2012(4)CPJ-646, “Life Insurance Corporation of India & others Vs. Harbans Kaur” 2009(3)CPC-677, and “Life Insurance Corporation of India & another Vs. Ashok Manocha” 2011(3)CPC-285, would have been applicable, had this fact been established that life assured suffered from pre-existing ailment of kidney and he deliberately suppressed this fact fraudulently from the Opposite Parties, when he took the insurance policy. In view of our finding recorded above that Opposite Parties had failed to prove this fact that complainant was suffering from any pre-existing ailment and hence these authorities would not be attracted in this case. In this regard, on the same and similar facts and circumstances of the case, Hon’ble State Consumer Disputes Redressal Commission, in First Appeal No.62 of 2015 decided on 02.02.2017 in case India First Life Insurance Vs. Ms.Sudesh Rani also held so.
10. In such a situation the repudiation made by Opposite Parties-Insurance Company regarding genuine claim of the complainant have been made without application of mind. It is usual with the insurance company to show all types of green pasters 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.
11. In view of the above discussion, we hold that the Opposite Party-Insurance Company have wrongly and illegally rejected the claim of the complainant.
12. Now come to the quantum of compensation. The complainant has claimed the amount of Rs.18,36,600/- on account of compensation including the principle amount of insurance, but the policy document Ex.R3 shows that the life insured was insured for sum assured of Rs.12,37,830/- and hence we hold that the complainant is entitled to the sum assured.
13. In view of the aforesaid facts and circumstances of the case, we partly allow the complaint of the Complainant and direct Opposite Parties-Insurance Company to pay Rs.12,37,830/- (Rupees twelve lakh thirty seven thousands eight hundred thirty only) to the complainant alongwith interest @ 8% per annum from the date of filing of this complaint i.e. 30.10.2017 till its actual realisation. The compliance of this order be made by the Opposite Parties 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. All pending applications are disposed off accordingly.Copies of the order be furnished to the parties free of cost by District Consumer Commission, Ludhiana and thereafter, the file be consigned to record room after compliance.
14. 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 Disputes Redressal Commission, Moga has decided the present complaint today at Camp Court, Ludhiana, as early as possible.
Announced in Open Commission at Camp Court, Ludhiana.
