BEFORE THE DISTRICT CONSUMER FORUM : MEDAK AT SANGAREDDY

PRESENT: Sri Patil Vithal Rao, B.Sc., LL.B.,President

Smt. Meena Ramanathan, B.Com., Lady Member

Monday, the 25^th day of August, 2014

                                              CC 40 of 2013                                

Between:

Smt. B. Suvarna W/o late B. Jagjivan,

Aged : Major, Occ: Household,

R/o H.No. 2-12, Indira Gandhi Statue,

Harijanwada, Ramayampet, Dist. Medak  - 502 101     

                                                                                                ……Complainant                       

                   And

1. The Branch Manager,

Life Insurance Corporation of India,

Branch Medak town,

2. The Divisional Manager,

Life Insurance Corporation of India,

Jeevan Sagar, Behind NTR Stadium,

Near Indira Part, Hyderabad – 500 080.

                                                                                     ……Opposite parties

This case came up for final hearing before us on 12.08.2014 in the presence of Sri G. Subhash Chander, advocate for complainant and Sri P. Rama Rao, Advocate for opposite parties no. 1 & 2, on perusing the record and having stood over for consideration till this day, this Forum delivered the following:

O R D E R

(Per se Smt. Meena Ramanathan, Lady Member)

                   The complainant, who is the wife of one deceased B. Jagajeevan approached this Forum by way of the present complaint, under Section 12  of the Consumer Protection Act, 1986, claiming the policy amount along with bonus, compensation of Rs.50,000/- and Rs.25,000/- towards damages. Her complaint, in brief is that during the life time of her husband, a policy was obtained with the opposite parties. The policy was for Rs. 5,00,000/- and taken on 04.11.2011. She was the nominee of her husband’s policy. Unfortunately, her husband died on 08.11.2011. The premium of the policy was paid. Thus the policy was inforce, at the time of his demise. She furnished the opposite parties with her photographs and necessary documents and bank account details, but they have not settled her claim till date. Since the opposite parties have failed to respond, she has filed this present complaint.

2.            The opposite parties submit in their counter, accepting that the deceased was the policy holder of policy no. 605406271 for a sum of Rs. 5,00,000/- and that the complainant B. Suvarna, his wife, is the nominee of the policy. They further submit that the claim was repudiated by them, as the deceased had not revealed material information. They state that the proponent/deceased had with held the material information and gave false answers in the proposed form. Thus there is no deficiency in service and they are not liable to pay the policy amount.

3.                The complainant filed her evidence affidavit and marked as Ex. A1to A4 to substantiate her claim.

                   The opposite parties filed their counter along with evidence affidavit and marked Ex. B1 to B4 in their defense.

                   Both sides filed their written arguments and heard oral submissions.

4.                Now the point for consideration is whether there is any deficiency in service on the part of the opposite parties, if so, to what relief?

Point:

5.                The fact that the husband of the complainant had taken a policy bearing no.605406271for a sum of Rs.5,00,000/- on 04.11.2011 is not disputed. The dispute is with regard to false answers given by the deceased in the proposal form; the opposite parties are repudiating the claim: Ex. A1 is the policy issued by LIC. There is no dispute regarding the issuance of the policy and the policy amount. The age of the life assured is only 45 years. The policy was issued on 04.11.2011 and the first installment of Rs.11,880 towards premium was received. Therefore the policy was inforce.

6.           Ex.A2 is a letter certified by a medical officer, stating that Borra Jagajeevan (the policy holder in this case) was brought dead on 08.11.2011, and he died due to heart attack. Ex.A3 is the Death Certificate. Ex.A4 is the list of questions in the proposal form answered by the deceased. This has been sent by the opposite parties to the complainant stating that material information was with held. 

7.                They claim that most of the answers were false and they have evidence to prove that the deceased did not disclose the health problems he suffered from. Had he done so, they would have had him examined and would have accordingly taken a decision. Non-disclosure of his health problems has adversely affected the under writing of this decision.

8.                On their behalf, the opposite parties filed the original policy form – Ex.B1. Ex.B2 in an inpatient record sheet of yashoda hospital, dated 31.08.2009. This record pertains to the deceased (husband of complainant), having been admitted to the hospital for surgery and it was done under general anesthesia  on 31.08.2009. At that time he was 42 years old.

9.                The fact that he had under gone this surgery was not revealed by him in the proposal form. He has denied all this in his answers, there by flouting the clause of “utmost good faith” of an insurance contract.

10.              Ex.B3 is the proposal form. In this the questionnaire pertaining to his personal history, has very misleading answers. There are pointed questions – asking “have you ever been admitted to any hospital?”  “have you undergone any operation”? To all these, he has not answered honestly. Ex.B4 is the same as Ex.A4, the questions asked in the proposal form.

                   The counsel for the opposite parties filed a copy of order dt.10.07.2013 in F.A. no. 172 of 2012 between: “Barupati sunitha and The Branch Manager, LIC”,: Wherein the Hon’ble A.P. State Commission upheld the order of the District Forum. Here the appellant’s husband had undergone surgery which was followed by chemotherapy and radio therapy and was not revealed at the time of submitting the proposal. Having suppressed vital information, the policy was repudiated and the claim amount with held by the respondent – Insurance Company. In the circumstance it was held that there was no deficiency in service on the apart of the insurer.

                   The Hon’ble State Commission’s said decision is based on the ruling of the Hon’ble National Consumer Disputes Redressal Commission in, “Life Insurance Company vs. M. Bhavani”, in RP.NO. 649/2005 and the ruling of the Hon’ble Supreme Court in, “P.C. Chacko vs. LIC”, 2008 (1) SCC 321. Further, the Hon’ble National Commission in, “Manjinder Kaur vs Life Insurance Corporation  & Anr.”, I (2014) CPJ 3 (NC) held that “it is the responsibility of the proposer to read and understand the Forms, before signing the same and that if a period of two years had passed after obtaining the Insurance Policy, policy cannot be called in question on ground of mis-statement, unless insurer shows that material facts had been suppressed with a fraudulent motive”. In the present case, death of the insured occurred before expiry of two years from date of commencement of policy. Therefore in the circumstance the repudiation by the insurance company is justified.

11.              In view of the aforesaid discussion we are of the considered opinion that the complaint should be dismissed.        The point is answered accordingly.

12.               In the result, the complaint is dismissed. No costs.

                  Dictated to Stenographer, after transcription and correction the order is pronounced by us in the open court today on this the 25^th day of August, 2014.

              Sd/-                                                            Sd/-                                  

MEMBER                                                   PRESIDENT

APPENDIX OF EVIDENCE

                            WITNESSES EXAMINED

For the complainant:                                            For the opposite party:-

DOCUMENTS MARKED

For complainants:-                                               For opposite party:-

   Sd/-                                                                Sd/-

MEMBER                                                       PRESIDENT

Copy to:

1. The Complainant
2. The Opp.parties
3. Spare copy