Date of filing:09.03.2023

                                                   Date of Disposal:21.03.2023

BEFORE THE KARNATAKA STATE CONSUMR DISPUTES REDRESSAL COMMISSION, BENGALURU (PRINCIPAL BENCH)

DATED: 21^st Day of March 2023

PRESENT

HON’BLE Mr. JUSTICE HULUVADI G. RAMESH: PRESIDENT

Mr K. B. SANGANNANAVAR: JUDICIAL MEMBER

Mrs DIVYASHREE M: LADY MEMBER

APPEAL No.435/2023

​O R D E R

BY HON’BLE Mr. JUSTICE HULUVADI G RAMESH : PRESIDENT

1. This Appeal is filed under Section 41 of Consumer Protection Act, 2019 by OPs in CC/53/2017, aggrieved by the order dated 22.12.2022 passed by District Consumer Disputes Redressal Commission, Mysore (for short District Commission and the parties arrayed as in the consumer complaint)

2. The Brief facts are: One Mr.J.Gangadhar, the husband of complainant on 31.01.2013 had obtained policy from OP1 by name BSLI Future Guard Plan bearing no.005940482 which covers death and sum assured was Rs.18,50,000/-.  It is alleged by the complainant that, her husband died on 01.05.2014 and hence, she being the nominee under the policy in dispute, claimed for realization of the assured amount.  But, the OPs instead of settling her claim, have repudiated the same, on the ground that, the deceased husband of complainant was suffering from pre-existing disease.  On the contrary, the OP2 appeared before the Commission below and contended that, that the life assured has suppressed the fact that he was suffering from Diabetes Mellitus type II and was on medication for the same, a known smoker and also he had met with an accident before submitting the Certificate of Insurability which was not disclosed to the OP at the time of reinstatement of the policy and thus repudiated the claim of the complainant.  After hearing both parties, the Commission below passed orders in favour of complainant/respondent, directing OPs jointly and severally to pay 50% of the sum assured under policy No.005940482 dated 31.01.2013 which comes to Rs.9,25,000/- along with interest @ 06% p.a. to the complainant within 02 months.  Further directed OPs to pay damages of Rs.50,000/- to the complainant towards deficiency in service and mental agony cause to the complainant and Rs.5,000/- towards cost of the litigation within 02 months from the date of the order, failing which the compensation of Rs.50,000/- + Rs.5,000/- towards cost of the litigation shall carry interest @ 06% p.a. till payment.  It is this order is now in this appeal, on the grounds that, the deceased life assured had suppressed regarding his pre-existing disease of Diabetes Mellitus type II and was under oral medication and also a smoker which was prior to proposal stage.  Further the deceased had declared incorrect details of his previous ailments and medical history in the Certificate of Insurability (COI).  Hence, the impugned order passed by the Commission below is liable to be set aside and prayed for dismissal of the complaint.

3. Commission heard and perused the impugned order passed by District Commission in CC/53/2017, dated 22.12.2022 and perused the records.  The question now arises for decision is whether impugned order passed by the Commission below is contrary to law and facts as appealed?

4. It is undisputed fact that the policy issued to life assured was lapsed on 31.07.2013 and the life assured had paid premium of Rs.44,762.35/- only.  It is also not in dispute that the policy was reinstated on 26.03.2014 on the basis of Certificate of Insurability dated 21.03.2014 submitted by life assured. The only dispute is that at the time of reinstatement of the insurance policy in question the life assured Sri.J.Gangadhar had concealed the health issues and submitted Certificate of Insurability and thus repudiated the claim of the complainant/respondent.  Admittedly the death of the life assured was on 01.05.2014 due to heart attack i.e., within 02 years from the date of issuance of the policy and within 01 month and 05 days from the date of reinstatement of the policy. Since it was the early claim the appellants/OP company as per Section 45 of the Insurance Act, 1938 conducted investigation and came to know that the life assured was suffering from Diabetes Mellitus type II  and had also met with an accident on 08.08.2013 i.e., before reinstatement of the policy and took treatment in KRS Hospital, Mysore.  It is the specific contention of the OPs/appellant is that based on the investigation conducted through investigator as there was a suppression of material facts at the time of reinstatement of policy the OP repudiated the claim of the complainant.  

5. In this regard, it is worth mention here the observations made by the Commission below while passing the impugned order.  The Commission below while examining the documents produced by the complainant/respondent i.e., the complaint given to Lashkar Mohalla Police Station, Mysore about the accident on 08.08.2013, the letter issued to medical officer of K.R. Hospital to Police Sub-inspector intimating that injured Sri.J.Gangadhar met with an accident on 08.08.2013 and was brought to the hospital and was undergoing treatment and also copy of medical certificate which shows that the patient Sri.J.Gangadhar  is permanently disabled, found that there is a mistake on the part of life assured in suppressing the health issues and submitting the Certificate of Insurability to get the lapsed insurance policy in question reinstated.  Further observes that at the time of reinstatement of the policy OPs/appellants had not taken any pain to investigate the life assured.  It is after the receipt of claim submitted by the complainant/respondent OPs/appellants had investigated the health issues of life assured. Thus the Commission below holds that if at all the OP was diligent before the reinstatement of the policy it could have investigated the health issues of life assured and could have ascertained the ill health of life assured.  As such by taking into consideration all these aspects i.e., the mistake on the part of life assured in suppressing the health issues and submitting the Certificate of insurability to get the lapsed insurance policy in question reinstated and the negligence on the part of OP in reinstating the policy without conducting proper investigation of health issues of life assured, the Commission below awarded 50% of the sum assured under the policy as during the subsistence of the policy, the life assured was died.  As such the Commission did not find any irregularity in the order passed by Commission below, since the Commission below appreciated the evidence in right perception and recorded sound reasons while passing the impugned order. Nonetheless, awarding Rs.50,000/- as compensation appears to be at higher side considering the facts and circumstances of the case, it would be just and proper to award Rs.20,000/- as compensation to meet the ends of justice.  With such conclusion, we dispense with issuance of notice of this appeal to respondent/complainant to avoid further delay and proceed to dismiss the appeal except modifying the order in so far as awarding compensation is concerned.  Rest of the order under award shall remain unchanged.

6. The Amount in deposit is directed to be transferred to Commission below for needful.

7. Send a copy of this Order to the District Commission and parties to the appeal.

Lady Member                                  Judicial Member                             President

*GGH*