Madhya Pradesh

StateCommission

A/16/1888

PRADEEP KHAPARDE - Complainant(s)

Versus

SBI LIFE INSU.CO. - Opp.Party(s)

MS.SHRADHA VIDHYARTHI

20 May 2024

ORDER

M. P. STATE  CONSUMER  DISPUTES  REDRESSAL  COMMISSION,                         

PLOT NO.76, ARERA HILLS, BHOPAL

 

FIRST APPEAL NO. 1888 OF 2016

(Arising out of order dated 26.10.2016 passed in C.C.No.41/2015 by District Commission, Balaghat)

 

1. PRADEEP KHAPARDE

    S/O LATE SHANKARLAL KHAPARDE

 

2. DHANENDRA KHAPARDE,

    S/O LATE SHANKARLAL KHAPARDE

BOTH R/O WARD NO.1, BUDI,

TEHSIL & DISTRICT-BALAGHAT (M.P.)                                                  …   APPELLANTS.

 

         Versus

 

1. SBI LIFE INSURANCE CO.LTD.

    REGD & CORPORATE OFFICE-NATRAJ,

    N.B.ROAD & WESTERN EXPRESS HIGHWAY

    JUNCTION, ANDHERI (EAST) MUMBAI-400 069

 

2. SBI LIFE INSURANCE CO.LTD.

    THROUGH BRANCH MANAGER,

    BRANCH-CIRCUIT HOUSE ROAD,

    BALAGHAT (M.P.)                                                                                   ...   RESPONDENTS.  

 

BEFORE :

            HON’BLE SHRI A. K. TIWARI                : ACTING PRESIDENT

            HON’BLE DR. SRIKANT PANDEY        :          MEMBER

           

COUNSEL FOR PARTIES :

                Ms. Shradha Vidyarthi learned counsel for the appellants.

           Shri Nitin Jain, learned counsel for the respondents.

 

O R D E R

(Passed On  20.05.2024)

                                The following order of the Commission was delivered by A. K. Tiwari, Acting President: 

                   The complainants/appellants have filed this appeal against the order dated 26.10.2016 passed by the District Consumer Disputes Redressal Commission, Balaghat (for short ‘District Commission’) in

 

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C.C.No.41/2015whereby the District Commission has dismissed the complaint filed by them.

2.                Briefly stated facts of the case are that the complainant’s father Late Shankarlal Khaparde (hereinafter referred to as deceased-insured) during his life time had obtained one insurance policy from the opposite parties-SBI Life Insurance Co. Ltd. (hereinafter referred to as ‘insurance company’) on 01.02.2013 for a sum insured of Rs.15,00,000/- after paying first yearly premium of Rs.17,979/-. The duration of the said policy was 10 years and the second premium was due in February-2014.  During the insurance cover on 30.12.2013 he died and the intimation of which was given to the insurance company immediately. The complainants being nominee filed a claim along with all necessary documents with the insurance company for sum insured. It is alleged that vide letter dated 01.08.2014, the insurance company repudiated the claim on the ground that in the proposal correct facts were not disclosed regarding previous medical history and there was suppression of material facts at the time of taking the policy. The complainant therefore filed a complaint before the District Commission seeking relief.

3.                The opposite parties-insurance company in its reply before the District Commission except the admitted facts denied the other allegations made in the complaint. It is submitted that the complainant no.2

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Dhanendra Khaparde is nominee under the subject policy and therefore the complainant no.1 Pradeep Khaparde has no right to file the complaint. It is submitted that after considering the information given by the deceased-insured is correct, a policy has been issued on 01.02.2013. After issuance of policy, after a period of 10 months and 16 days, i.e. on 30.12.2013 the deceased-insured died. On investigation being carried out by the insurance company it is found that he was suffering from Cerebral Vascular Accident, Parkinson’s disease and Paralysis. It is also submitted that before taking the subject insurance policy the deceased-insured has also taken a policy no.50392829 commencing from 25.09.2012 for sum insured of Rs.15,00,000/- and policy no. 50420278 commencing from 12.10.2012 for sum insured of Rs.4,50,000/- and policy no. 50601270 commencing from 08.01.2013 for sum insured of Rs.5,00,000/- from Reliance Life Insurance Company Limited. However, the deceased-insured suppressed the material facts regarding his illness and the fact that earlier he took 3 policies from Reliance Life Insurance Co. Ltd. in the proposal form in order to obtain the subject insurance policy which is violation of policy terms and conditions. Therefore there is no deficiency in service on part of the insurance company in repudiating the claim. It is therefore prayed that the complaint be dismissed.

 

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4.                The District Commission dismissed the complaint holding that since the complainant had suppressed the material facts regarding his illness and correct fact of taking policies in the proposal form while obtaining the subject insurance policy, therefore the insurance company cannot he held guilty of deficiency in service.

5.                Heard learned counsel for the parties. Perused the record.

6.                Learned counsel for the complainants/appellants argued that the District Commission has committed material irregularity in not going through the evidence and other related documents filed on record. She argued that the District Commission relying on the document R-4 that the deceased insured was admitted for CVA Parkinson’s disease and HT from 22.06.2013 to 26.06.2013 and in the paper dated 21.06.2013 of Mitali Nursing Home it is mentioned that the deceased insured was suffering from Paralysis since last one year but the District Commission failed to consider that if he was suffering from paralysis since last one year how he can fill and sign the proposal form and this fact must have in the knowledge of the agent.

7.                She further argued that in the investigation report it is not clear that from last one year in which hospital and for which duration, the deceased-insured took treatment. She argued that the District Commission did not consider this important aspect that in the proposal form every

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information is filled by the agent who fraudulently suppressed the fact of earlier policies. It is true that the insurance company can repudiate the claim for suppression of material facts but non-disclosure of earlier policies cannot be termed as material fact. She argued that the deceased-insured was healthy and hearty at the time of taking the subject insurance policy and there was no suppression of any material fact. She argued that the District Commission has erroneously dismissed the complaint and therefore, the impugned order deserves to be set-aside.

8.                She placed reliance on the decisions of Hon’ble National Commission in LIC of India Vs Mamta Sipani decided on 2 March, 2022, SBI Life Insurance Co. Ltd. Vs Geeta Kunwar decided on 16 May, 2023 and a decision of this Commission in First Appeal No.337/2016 (Reliance Life Insurance Co. Ltd. Vs Pradeep Khaparde & Anr) and First Appeal No.338/2016 (Pradeep Khaparde & Anr Vs Reliance Life Insurance Co. Ltd.) decided on 17.07.2023.

9.                Learned counsel for the opposite parties-insurance company submitted that the policy was issued without medical examination and only on the basis of information given by the deceased-insured. After examination, the claim filed by the complainant was repudiated and the complainant was informed. In the proposal form in query to clause no.11 and clause 13(xv) the deceased-insured had given answer in No. Since

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there was suppression of material fact which amounts to violation of policy terms and conditions, the complainants are not entitled to any claim. There has been no deficiency in service on part of the insurance company in repudiating the claim. He therefore supporting the impugned order prayed for dismissal of appeal.

10.              He placed reliance on the decisions of Hon’ble Supreme Court in Civil Appeal No. 4261 of 2019 (Reliance Life Insurance Co. Ltd. Vs Rekhaben Nareshbhai Rathod) decided on 24 April, 2019 and in Civil Appeal No. 3397 of 2020 (Branch Manager, Bajaj Allianz Life Insurance Co.Ltd. and Ors Vs Dalbir Kaur) decided on 9 October, 2020.    

11.              The complainant no.2-Dhanendra Khaparde has filed his affidavit along with documents C-1 to C-8 in support of his complaint. On behalf of insurance company an affidavit of Smt. Gurpreet Kaur an authorized representative and affidavit of Neelesh Chandola, Investigator along with documents R-1 to R-13 have been filed.

12.              We have given thoughtful consideration to arguments advanced by learned counsel for the parties and carefully perused the record as also the impugned order. R-1 is a proposal form dated 01.02.2013 filled by the deceased-insured in order to obtain the policy. In the said proposal form in clause 11 in answer to the query raised, Do you

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have any other individual life insurance policy or have you applied for one? As also in clause 13(xv) (k) in answer to the query raised, Do you suffering from or did you suffer or undergo investigation in the past from or have you been advised to undergo investigation or treatment for Brain/Nervous System Disease/Stroke,  he had given answer in ‘No’.

13.              R-4 is investigation report dated 27.05.2014 of Investigator Neelesh Chandolia, who after investigation and collecting medical treatment papers of deceased-insured from different hopsitals gave his report. He had obtained the discharge card of deceased-insured from Mitali Maternity and Surgical Nursing Home where deceased-insured was admitted from 22.06.2013 to 26.06.2013 and was diagnosed as a case of Cerebral Vascular Accident (CVA) and Parkinson’s disease and HT. Again the deceased-insured was admitted in the same hospital for the period 07.12.2013 to 12.12.2013 and was diagnosed with Septicemia Shock with old CVA. In the medical prescription dated 21.06.2013 of Mitali Nursing Home (R-5) it is mentioned that deceased-insured had a history of paralysis since last 1 year. In the medical prescription dated 22.06.2013 of Mitali Nursing Home (at Page 71) it is mentioned that the deceased insured was suffering from CVA with Parkinson’s disease with HT. From the above medical records, it is clear that the deceased-insured was

 

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suffering from CVA with Parkinson’s disease with HT and paralysis since last one year.

14.              Admittedly, after filling up the proposal form on 01.02.2013 the deceased-insured had obtained insurance policy, however, he has not given any information about his previous ailment in the proposal form more particularly in the queries raised regarding his state of health. The medical records which have been obtained during the course of investigation clearly indicate that the deceased-insured was suffering from serious pre-existing medical condition which was not disclosed to the insurance company. 

15.              Also the complainant no where denied this fact that the deceased-insured took insurance policies from the Reliance Life Insurance Company Limited. This fact is also confirmed from the judgment relied by counsel for complainants/appellants of this Commission in First Appeal No.337/2016 & 338/2016 decided on 17.07.2023 (supra) with regard to insurance policies obtained by the deceased-insured from Reliance General Insurance Company Limited. Thus it is also well established that he took life insurance policies from Reliance General Insurance Co. Ltd. and this fact was concealed by him in answer to query no.11 in the proposal form for obtaining the subject policy. 

 

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16.              In the column of declaration in the proposal form, the deceased-insured has declared that “If there is any misstatement or suppression of material information or if any untrue statements be contained therein the said contract shall be absolutely null and void and all moneys which shall have been paid in respect thereof shall stand forfeited to the company.”

17.              In view of the aforesaid, it is clear that at the time of taking insurance policy, the deceased-insured was suffering from CVA which is a stroke with Parkinson’s disease with HT and paralysis but he did not disclose this important fact to the insurance company. The contract of insurance is based on utmost good faith and it is well settled that in case of suppression of material fact, the claimant is not entitled to any relief. Thus, we are of a considered opinion that the insurance company has committed no error or deficiency in service in repudiating the claim of the deceased-insured filed by the complainant.

17.              So far as the contention of learned counsel for the complainants/appellants that it is the agent who filled information in the proposal form and suppressed material information and obtained signature

of the deceased-insured, therefore the complainant cannot be deprived of benefits under the policy is concerned, Hon’ble Supreme Court in Rekhaben(supra) has clearly held that “a person who affixes his signature

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to a proposal which contains a statement which is not true, cannot ordinarily escape from the consequences arising therefrom by pleading that he chose to sign the proposal containing such statement without either reading or understanding it. That is because, in filling up the proposal form, the agent normally, ceases to act as agent of the insurer but becomes the agent of the insured and no agent can be assumed to have authority from the insurer to write the answers in the proposal form. If an agent nevertheless does that, he becomes merely the amanuensis of the insured, and his knowledge of the untruth or inaccuracy of any statement contained in the form of proposal does not become the knowledge of the insurer.” Thus it is clear that for the consequences of wrong answers given in the proposal form, the deceased-insured cannot escape from the liability.

18.              Hon’ble Supreme Court in Dalbir Kaur (supra) and in Rekhaben (supra) has clearly held that the finding of material misrepresentation or concealment in insurance has a significant effect upon both the insured and the insurer in the event of a dispute. The fact it would influence the decision of a prudent insurer in deciding as to whether

or not to accept the risk is a material fact. There is a clear presumption that any information sought for in the proposal form is material for the purpose of entering into a contract of insurance.

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19.              In the light of the aforesaid judgments of Hon’ble Supreme Court and in the facts and circumstances of the case, the decisions relied upon by learned counsel for the complainants/appellant of Hon’ble National Commission and this Commission will not help the complainants/appellants.

20.              In view of the aforesaid discussion, we are of the opinion that the District Commission has committed no error in dismissing the complaint. We do not find any illegality or infirmity in the impugned order. Accordingly, the impugned order is hereby affirmed.

21.              In the result, this appeal fails and is hereby dismissed with no order as to costs.

               (A. K. Tiwari)                          (Dr. Srikant Pandey)

            Acting President                             Member