Punjab

Ludhiana

CC/21/309

Amandeep Kaur - Complainant(s)

Versus

Star Union Life Ins.co.Ltd - Opp.Party(s)

M.S.Sethi Adv

21 Mar 2024

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION, LUDHIANA.

                                                Complaint No:309 dated 21.06.2021.                                                         Date of decision: 21.03.2024.

 

Amandeep Kaur W/o. Late Okar Singh, R/o. H. No.209, Village Jogi Basti, Near Bassi Palace, Dharamkot,  Moga, Punjab-142042.                                                                                                                                                 ..…Complainant

                                                Versus

1. Star Union Dai-ichi Life Insurance Company Limited, 11^th Floor, Vishwaroop I.T. Park, Plot No.34, 35 & 38, Sector 30A of IIP, Vashi, Navi Mumbai-400703 through authorized signatory.
2. Star Union Dai-ichi Life Insurance Company Limited, Regional Office -S.F. 1, 2^nd Floor, Kunal Tower 88, Mall Road, Ludhiana-141001 (Punjab) through authorized signatory.
3. Sachin, Insurance Advisor Code No.82029280 C/o. Star Union Dai-ichi Life Insurance Company Limited, Regional Office -S.F. 1, 2^nd Floor, Kunal Tower 88, Mall Road, Ludhiana-141001.                                                                                                                   …..Opposite parties 

Complaint Under section 35 of the Consumer Protection Act.

QUORUM:

SH. SANJEEV BATRA, PRESIDENT

MS. MONIKA BHAGAT, MEMBER

 

COUNSEL FOR THE PARTIES:

For complainant             :         None

For OP1 and OP2          :         Sh. Ajay Chawla, Advocate.

For OP3                         :         Complaint against OP3 stands already                                                         dismissed as withdrawn vide order dated                                                      21.12.2022.

 

ORDER

PER SANJEEV BATRA, PRESIDENT

1.                In brief, the facts of the case are that on 26.11.2018, the insurance advisor of the OPs disclosed Okar Singh (hereinafter called as DLA), husband of the complainant regarding insurance policy of the OPs under plan ‘SUD Life Premier Protection Plan & its riders, upon which Okar Singh purchased the said plan for sum insured of Rs.30,00,000/- including rider on yearly installment of Rs.18,620/- including taxed for the tenure of 30 years. Policy No.01268922 was supplied to Okar Singh on the basis of information given by DLA in the proposal form dated 26.11.2018 which was duly filled by the agent. Rather the agent noted all the details provided by Okar Singh on a separate white paper. DLA regularly paid premium of Rs.18,620/- till his death. The complainant stated that Okar Singh died on 14.11.2019 and this fact was confirmed by the doctors. The complainant further stated that claim was lodged with the OPs but the OPs issued letter dated 25.03.2020 cancelling/repudiating the claim of the complainant on the following grounds:-

“With reference to the above-mentioned policy, we have received the claim forms and documents for evaluation of claim. However, based on the information received,  we regret to inform you that we have decided to cancel the policy on the grounds of fraudulent claim by falsely alleging death of life assured as well as non-disclosure of previous insurance to the tune of INR 6,00,00/- (Rupees Six Crore only) Approximately in the proposal form.

In this connection, we have noted that in the proposal for insurance signed and submitted by the life assured on 26/11/2018, the relevant question in the proposal form were answered as follows:-

Section XV: Previous Insurance Details of Life to be assured

Do you have any existing life insurance or have you made simultaneous application for insurance within this proposal with SUD Life or any other Insurance Company.          (√)

If yes, provide following details (attach separate sheet if necessary)

Name of Insurer	Policy No.	Risk commencement Date	Sum Assured	Annual Premium	Rider, if any	Status
SUD	13139411	12/09/18	2500000	49115/-	-	In force
LIC	161980547	2010	500000	50000/-	-	Surrendered

After  careful evaluation of all the records obtained by us, we understand and have documentary evidence to show that Life Assured had taken      insurance cover from other insurance companies to the tune of Rs.6,00,000/- (Rupees Six Crore only) approximately, prior to the risk commencement date of the subject policy. This vital information was neither disclosed by the insured member at the time of filing up the proposal form nor informed to the company before the acceptance of the proposal and insurance policy.

Had this fact been disclosed at the time of proposal, the company would have declined to offer the insurance cover. The insured member has suppressed the material information in the proposal form due to which the company was deprived of the right to diligently assess the risk involved.

It is further submitted that life assured, despite being alive had submitted fraudulent claim through the claimant by submitting false death certificate and other documents with the company. It is submitted that insurance contracts are based on the principle of "utmost good faith" and the policies are issued based on the representations made in the proposal form and any non- disclosure or misrepresentation in the proposal form renders the contract voidable at the option of the insurer. Any misstatement of suppression of material facts shall be treated in accordance with the section 45 of the Insurance Act, 1938 as amended from time to time.]

In view of this, we are constrained to cancel the policy under the subject policy due to non- disclosure of material information by the Life assured and as such sum assured is not payable.”

 

The complainant further stated that the OPs rendered deficient/negligent services and unfair trade practice for cancellation of the policy without issuing any show cause notice and as such, the cancellation letter dated 25.03.2020 is illegal and deserves to be dismissed. Moreover, the OPs have cancelled the policy and repudiated the claim on the alleged ground of suppression of material information in the proposal form. All the relevant information was supplied by the DLA to the insurance advisor of the Ops who himself filled the proposal form and got signed the same from DLA. Further the contents of application form printed being ‘Previous insurance details of the life to be assured has nowhere specifically reflected in the policy No.01268922 and as such, the Ops cannot be allowed to repudiate the claim at later stage. According to the complainant, the claim is duly payable by the OPs in terms of policy schedule and she is duly entitled to the sum assured. In the end, the complainant has prayed for setting aside the repudiation letter dated 25.03.2020 to be illegal, arbitrary and also for issuing direction to the opposite parties to settle and pay the claim of Rs.30,00,000/- being guaranteed sum assured with benefits. The complainant further prayed for issuing directions to the OPs to pay compensation of Rs.5,00,000/- and litigation expenses of Rs.22,000/-.

2.                The complaint as against OP3 was dismissed as withdrawn vide order dated 21.12.2022.

3.                Upon notice, OP1 and OP2 filed joint written statement and by taking preliminary objections, assailed the complaint on the ground of maintainability of the complaint, misleading this Commission by concocting and distorting facts; concealment of material facts by the complainant; lack of jurisdiction and cause of action etc. OP1 and OP2 stated that the DLA Sh. Okar Singh submitted proposal form dated 26.11.2018 for purchase of SUD Life Premier Protection Plan along with SUD Life Accidental Death and total & Permanent Disability Benefit Rider. On the basis information submitted by the DLA in the proposal form, a policy bearing No.01268922 for sum assured of Rs.30,00,000/- along with an additional sum assured of Rs.30,00,000/- qua SUD Life Accidental Death and Total & permanent Disability Benefit Rider was issued for a premium of Rs.18,620/- including rider benefit of Rs.2832/- for a term of 30 years on annual basis. Sh. Okar Singh died on 14.11.2019 and as such, the complainant being his wife and nominee intimated the OPs and completed all the requisite formalities for getting the benefit of the insurance policy. On receipt of death claim being an early claim, the OPs conducted in investigation with regard to death claim and revealed that the DLA is still alive and had acquired more than 20 policies with various insurance companies, out of which 4 claims were declined by various insurance companies on various grounds. The details of the policies are reproduced as under:-

Sr. No.	Company Name	Risk Comm. Date	Sum Assured	Policy Number
1.	HDFC Life	05.11.2016	26,00,000.00	18900131
2.	Exide Life	17.11.2018	50,00,000.00	3434963
3.	Aegon Life	04.12.2018	10,00,000.00	180815000000
4.	Canara HSBC Life	24.08.2018	35,00,000.00	1500763011
5.	Canara HSBC Life	19.11.2018	30,00,000.00	9100416375
6.	Canara HSBC Life	19.11.2018	30,00,000.00	9100416376
7.	Canara HSBC Life	27.11.2018	35,00,000.00	9100416378
8.	Canara HSBC Life	23.03.2019	19,50,000.00	9100416374
9.	Edelweiss Tokio Life	05.01.2017	65,00,000.00	000077490E
10.	Edelweiss Tokio Life	26.11.2018	25,00,000.00	000077505E
11.	Edelweiss Tokio Life	06.02.2019	25,00,000.00	000035824E
12.	Bajaj Allianz Life	06.02.2019	5,00,000.00	352623201
13.	FGI Life	12.04.2018	19,50,000.00	1512978
14.	FGI Life	09.11.2018	20,00,000.00	1475318
15.	FGI Life	16.11.2018	2,00,000.00	1476687
16.	Aviva India Life	18.07.2018	15,00,000.00	10380696
17.	Aviva India Life	08.10.2018	50,00,000.00	10386099
	Total Sum Assured		4,62,00,000.00
18.	Star Union Dai-ichi	13.12.2018	30,00,000/-	01268922
19.	Star Union Dai-ichi	19.11.2018	30,00,000.00	01263055
	SUD Total		60,00,000.00
	Total Insurance		5,22,00,000.00

 

 

OP1 and OP2 further stated that in the proposal form, the DLA was asked specific question which he answered incorrectly, the detail of which is reproduced as under:-

Section XV: Previous Insurance Details of Life to be assured

Do you have any existing life insurance or have you made simultaneous application for insurance within this proposal with SUD Life or any other Insurance Company.          (√)

If yes, provide following details (attach separate sheet if necessary)

Name of Insurer	Policy No.	Risk commencement Date	Sum Assured	Annual Premium	Rider, if any	Status
SUD	13139411	12/09/18	2500000	49115/-	-	In force
LIC	161980547	2010	50000	50000/-	-	Surrendered

 

The DLA has not disclosed about purchasing of 20 different policies for more than 4.90 Crores in the proposal form and many other insurance companies have repudiated the claim on the ground the DLA was found to be alive. The DLA had committed a breach of principle of “UTMOST GOOD FAITH” by suppressing the material facts that he had huge life insurance cover prior to taking policy in question. Further the insurer has to disclose all the material facts while obtaining the insurance policy. OP1 and OP2 further stated they repudiated the claim vide repudiation letter dated 25.03.2020 on the ground of misrepresentation/non-disclosure of material information of the DLA after taking into consideration of Section 45 of the Insurance Act, 1938. As such the DLA has played fraud with the OPs by faking his own death to unlawfully obtain huge sum assured of Rs.30,00,000/- from them and now the complainant is not entitled to any further benefits under the policy or the compensation.

                   On merits, OP1 and OP2 reiterated the crux mentioned in the preliminary objections and brief facts of the case. OP1 and OP2 have denied that there is any deficiency of service and have also prayed for dismissal of the complaint.

4.                On 19.01.2024, Sh. M.S. Sethi, Advocate counsel for the complainant suffered statement having no instructions from the complainant to contest the case further and withdrew his power of attorney filed on behalf of the complainant. Accordingly, a fresh notice was issued to the complainant but neither the complainant nor anyone on her behalf turned up.

                   Even none turned up on behalf of the complainant today also. The complainant failed to tender her formal evidence despite grant of sufficient opportunities including last and final chance. In these circumstances, this Commission is of the considered view that the complainant has failed to produce any evidence in order to establish her pleadings as alleged in the complaint. Therefore, the complainant has failed to discharge the initial burden of proving deficiency in service on the part of the opposite parties by way of any credible evidence.

5.                In this regard, reference can be made to SGS India Ltd. Vs Dolphin International Ltd. in Civil Appeal No.5759 of 2009 decided on 06.10.2021 (LL 2021 SC 544) by the Hon’ble Supreme Court of India whereby it has been held as under:-

’19.  The onus of proof of deficiency in service is on the complainant in the complaints under the Consumer Protection Act, 1986. It is the complainant who had approached the Commission, therefore, without any proof of deficiency, the opposite party cannot be held responsible for deficiency in service.

In the above cited case, the Hon’ble Supreme Court of India has placed reliance on its own judgment reported as Ravneet Singh Bagga v. KLM Royal Dutch Airlines & Anr. whereby it has been held that the burden of proving the deficiency in service is upon the person who alleges it. “6. The deficiency in service cannot be alleged without attributing fault, imperfection, shortcoming or inadequacy in the quality, nature and manner of performance which is required to be performed by a person in pursuance of a contract or otherwise in relation to any service. The burden of proving the deficiency in service is upon the person who alleges it. The complainant has, on facts, been found to have not established any wilful fault, imperfection, shortcoming or inadequacy in the service of the respondent.”

‘20. This Court in a Judgment reported as Indigo Airlines v. Kalpana Rani Debbarma & Ors. (LL 2021 SC 544) held the initial onus to substantiate the factum of deficiency in service committed by the opposite party was primarily on the complaint. This Court held as under:-

“28. In our opinion, the approach of the Consumer Fora is in complete disregard of the principles of pleadings and burden of proof. First, the material facts constituting deficiency in service are blissfully absent in the complaint as filed. Second, the initial onus to substantiate the factum of deficiency in service committed by the ground staff of the Airlines at the airport after issuing boarding passes was primarily on the respondents. That has not been discharged by them. The Consumer Fora, however, went on to unjustly shift the onus on the appellants because of their failure to produce any evidence. In law, the burden of proof would shift on the appellants only after the respondents/complainants had discharged their initial burden in establishing the factum of deficiency in service.”

The Hon'ble Supreme Court of India has further upheld this view in recent judgment II(2023) CPJ 83 (SC) in Chairman & Managing Director, City Union Bank Ltd. & Anr. Vs R. Chandramohan. In the given facts and circumstances, the complainant has failed to prove the deficiency in service on the part of the opposite parties by any cogent and convincing evidence.

6.                As a result of above discussion, the complaint fails and the same is hereby dismissed for want of prosecution. However, there shall be no order as to costs. Copies of the order be supplied to the parties free of costs as per rules. File be indexed and consigned to record room.            

7.                Due to huge pendency of cases, the complaint could not be decided within statutory period.

 

                             (Monika Bhagat)                        (Sanjeev Batra)                                                Member                                      President         

 

Announced in Open Commission.

Dated:21.03.2024.

Gobind Ram.