This C.C. is coming on before us for hearing in the presence of Sri. O. Seshagiri Rao, Advocate for complainant; and of Sri. G. Sita Rama Rao, Advocate for opposite party No.3; and of Sri. B. Gangadhar, Advocate for opposite party No.1 deleted; notice of opposite party No.2 not returned and deleted; upon perusing the material papers on record; upon hearing and having stood over for consideration, this Forum passed the following:-

O R D E R

(Per Sri. R. Kiran Kumar, Member, FAC President)

This complaint is filed under section 12(1) of the Consumer Protection Act, 1986.

2.       The averments made in the complaint are that the husband of the complainant has obtained the Bajaj Allianz Life insurance Policy from the opposite party No.3 on 09-03-2012, vide policy No.0257496930 for sum assured of Rs.2,00,000/- by paying an amount of Rs.24,208/- towards first annual premium.  The complainant submitted that the date of commencement of policy is 09-03-2012 and maturity date is 09-03-2021, the complainant name was mentioned as nominee in the policy.  The complainant submitted that on 15-07-2012 the husband of the complainant died, after death of her husband, on 05-12-2012 the complainant submitted claim form along with all documents to the opposite party and claimed the basic sum assured i.e. an amount of Rs.2,00,000/-.  The complainant further submitted that on 20-02-2013 the opposite party No.3 send a letter stating that the death claim under above mentioned policy has been declined for following reasons “the hospitalization /treatment during 25-12-2010 to 13-02-2011 for the fracture of left femur with history of alcoholism and recently diagnosed hypertension.  Thus facts are not disclosed in the proposal form dt.07-03-2012”.  The complainant also submitted that the husband of the complainant was hail and healthy at the time of obtaining the policy and was not suffering from any disease much particularly “hypertension” at the time of obtaining the policy, the agent of the opposite party No.3 has obtained total information from the husband of the complainant whether he is suffering from any disease and the same was mentioned in the proposal form, the husband of the complainant was thoroughly checkup by the qualified doctors and after satisfying the same the opposite party issued the policy.  The complainant further submitted that her husband was hale and healthy and he died unfortunately on 15-07-2012 as such, as a nominee she is eligible to receive the basic sum assured i.e. an amount of Rs.2,00,000/-.  The complainant further submitted that after death of her husband, the opposite party No.3 making false allegations and searching grounds to repudiating the claim and avoid the payment.  As the opposite party No.3 failed to pay the policy amount the complainant approached the forum for deficiency of service. 

3.       While the matter is pending, complainant filed a petition vide IA.No.178/2013 U/o. 1 Rule 10 R/w Sec. 151 CPC praying this Forum to add the Bajaj Life Insurance Company in the array of Opposite party no.3 for the purpose of proper adjudication and the same was allowed.  The complainant filed another petition vide IA.No.14/2016 praying this Forum for consequential amendments and the same also allowed, opposite party Nos. 1 & 2 were deleted.

4.       Along with the complaint, the complainant filed affidavit and photocopies of following documents; those were marked as Exhibits A1 to A8.

Ex.A1:-Photocopy of regular premium receipt.

Ex.A2:-Photocopy of claim notification against policy No.0257496930.

Ex.A3:-Photocopy of Death Certificate.

Ex.A4:-Photocopy of Aadhar Card.

Ex.A5:-Photocopy of Household card.

Ex.A6:-Photocopy of Identity card issued by Election Commission of India.

Ex.A7:-Photocopy of Bank Pass Book, issued by Oriental Bank of Commerce, Khammam.

Ex.A8:-Rejection of claim letter dt.20-02-2013 issued by Opposite party.

4.       On receipt of notice, the opposite party No.3appeared through their counsel and filed counter. In their counter the opposite party No.3 denied all the allegations made by the complainant in the complaint.  The opposite party No.3 submitted that the deceased life assured has not disclosed the treatment / diagnosis dt.25-12-2010 to 13-01-2011 for fracture of left femur with history of alcoholism and recently diagnosed hypertension prior to making the proposal dt. 07-03-2012, the deceased / life assured was under an obligation to mention the actual illness or disease in the proposal form at the time of applying for the insurance policy from the insurance company.  The opposite party No.3 further submitted that had he disclosed the same the company would not have insured the life assured under the said policy or would have certainly called for more documents and the medical tests, these breach of providing false information by the assured entitles the insurer to avoid the contract of insurance so long as he can show that the non-disclosure induced the making of the contract on the relevant terms.  The opposite party No.3 submitted that the insurance policy is based upon contract whereby the proposal along with the first insurance premium is received from the proposer, who intends to take the insurance policy from the insurance company. The opposite party No.3 further submitted that upon receipt of the death claim they made investigation and found that life assured had taken treatment towards the said disease at Mamata General and Super specialty Hospital, Khammam dt. 25-12-2010 prior to issuance of the insurance policy, dt. 07-03-2012, the investigation report along with treatment records, wherein, the life assured was taken treatment for the said disease stated above is filed, the above facts amounts to non-disclosure of material facts and hence the present complaint is not maintainable on the grounds.  The opposite party No.3 further submitted that the life insurance policy is issued to the life assured based on the principles of “UberimmaFidei” i.e. utmost good faith and accordingly rely on the declarations and statements made in the proposal form, the company has issued the policy in the name of the life assured, it is stated that when an information on a specific aspect is asked for in the proposal form, an assured is under a solemn obligation to make a true and full disclosure of the information on the subject which is within his knowledge.  The opposite party No.3 submitted that when the deceased has the knowledge of his particular pre existing disease and other matters, he is obliged to disclose it particularly while answering the questions in the proposal form, in the absence of such disclosure or in case of any inaccurate answer will entitle the insurer to repudiate his liability because there is clear presumption that any information sought for in the proposal form is material for the purpose of entering into a contract of insurance.  To support their contention the opposite party No.3 relied IN Satwant kaur Sandu Vs. New India Assurance Co. Ltd., IV (2009) CPJ 8 (SC) and United India Assurance Co. Ltd., Vs. M.K.J. Corporation III (1996) CPJ 8 (SC)   in both the cases the Hon’ble Apex Court observed that it is a fundamental principle of insurance law that utmost faith must be observed by the contracting parties. Good faith forbids either party from non-disclosure of the facts which the party privately knows, to draw the other into bargain, from his ignorance of that fact and his believing the contrary.  The opposite party No.3 also submitted that looking into the facts of the case compelled with documentary evidence it is amply clear that the complainant has come before this Forum with unclean hands, the complaint is not maintainable under the provisions of the C.P. Act. As the repudiation of the claim is on valid and justifiable grounds and also submitted that there is no deficiency in service on the part of opposite party No.3 and prayed to dismiss the complaint.

5.       On behalf of the opposite party No.3 documents filed.

6.       Written Arguments of complainant filed.

7.       Heard Oral arguments from both sides.

8.       Upon perusing the material available on record, now the point that arose for consideration are,

1) Whether the complainant is entitled for the claim?

2) To What relief?

Point No.1:-                   

The case of the complainant is that, the husband of the complainant has obtained policy from the opposite party No.3 vide policy bearing No.025749630 for sum assured of Rs.2,00,000/- by paying an amount of Rs.24,208/- towards its annual premium.  According to the complainant, the insured died on 15.07.2012, after death of her husband she immediately informed the death information to opposite party No.3 and also submitted the claim form along with original bond and other required papers of the death claim of the deceased.  The opposite party No.3 Corporation failed to settle the claim of the deceased under the policy, as the opposite party No.3 committed deficiency in service the complainants filed the present complaint.  According to the opposite party No.3, the deceased/ life assured had intentionally suppressed the material fact that the hospitalization / treatment during 25-12-2010 to 13-02-2011 for the fracture of left femur with history of alcoholism and recently diagnosed hypertension, this fact was not disclosed in the proposal form dated 07-03-2012 and submitted proposal and obtained insurance policy, as such the complaint is liable to be dismissed. 

From the documents and material available on record, we observed that the policy, the sum assured are not in dispute.  The objection taken by the opposite party No.3 is that the life assured had suppressed material fact of his treatment record from the opposite party No.3 Corporation.  For that the insurance company was bound to prove that the insured had received treatment, before purchasing of the policy.  In the present case, the opposite party No.3 insurance company did not even file the treatment record issued by the concerned hospital in order to prove their contention, nor examined any of the doctors nor filed the affidavits of the doctors who treated the insured in support of their contention.  We are of the considered opinion that all these discret enquiries, investigations and health checkups etc., ought to have been made before issuance of policy itself.  Having issued the policy they cannot repudiate the claim on one ground or the other.

          In similar circumstances in Abdul Lateef Vs. LIC of India in RP No.2370/2012 the Hon’ble National Commission held that “it is unfortunate that on one hand the LIC raises the voice of “Utmost good faith” but, in contrast, the faith will be lost while not settling the genuine claims for some or other reasons.  It is the exploitation of the policy holders.  The consumers are literally under fear or dilemma that, whether, after death, the beneficiaries ever certainly get any fruits from the LIC”.  From the above observations we decide this point in favour of the complainant.

Point No.2:-         

In the result, the complaint is allowed in part, directing the opposite party No.3 to pay the sum assured amount i.e. Rs.2,00,000/- covered under the policy bearing No.0257496930, with interest @9% p.a. from the date of repudiation (i.e.20-02-2013) till the date of realization.   The complaint against opposite parties No.1 & 2 is dismissed as they were deleted.

           Typed to dictation, corrected and pronounced by us, in the open forum on this the 22^nd day of March, 2016.                                                      

                     FAC President              Member

District Consumer Forum, Khammam

APPENDIX OF EVIDENCE

WITNESSES EXAMINED:-

For Complainant:-                                                     For Opposite party:-   

       -None-                                                                           -None-

DOCUMENTS MARKED:-

For Complainant:-                                                     For Opposite party:-   

FAC President               Member

District Consumer Forum, Khammam