This C.C. is coming on before us for hearing in the presence of Sri Gogula Brahmaiah, Advocate for Complainant and of Sri K. Uttam Kumar, Advocate for opposite parties 1 to 3; upon perusing the material papers on record; upon hearing and having stood over for consideration, this Forum passed the following order;

ORDER

(Per Sri R. Kiran Kumar, FAC President)

This complaint is filed u/s.12-A of Consumer Protection Act, 1986. 

2.      The averments made in the complaint are that the husband of the complainant by name Thambarala Muthaiah had obtained Birla Sun Life Insurance Policy from opposite party No.1 branch, Khammam vide policy No. 005548412, dt. 19-04-2012 (Vision Plan), the sum assured is Rs.4,50,000/- along with other benefits and the amount has to be paid by the policy holder in yearly installments @ Rs.23385.54 ps. for a period of 25 years.  The complainant submitted that her husband paid premium Rs.23,385.54 ps including service tax and educationcess on 19-04-2012.  The complainant further submitted that on 05-08-2012 the husband of the complainant died due to jaundice.  After death of her husband the complainant submitted her application on 08-09-2012 to opposite party No. 1 to 3 for death claim by producing death certificate of deceased Muthaiah.  The complainant further submitted that the claim was rejected by opposite party no.2 on 27-12-2012 by giving false reasons that the insured Muthaiah died prior to the date mentioned in the death certificate and the same was informed to the complainant in the letter addressed to the complainant.  The opposite parties also advised the complainant that if any grievance is there, the complainant has to approach claims redressal at the opposite party No.3.  The complainant also submitted that as per the advise, the complainant submitted an application dt. 12-08-2013 before opposite party No.3 for reconsideration of her claim, the opposite party No.3 orally informed the complainant that they are not going to reconsider the matter.  The complainant further submitted that the opposite parties are intentionally dragging the matter on one pretext or the other, the non-payment of claim of complainant comes under the definition of deficiency of service as such the complainant filed this complaint.

3.      On behalf of the complainant the following documents were filed and marked as Exhibits A1 to A2.

Ex.A1:-Photocopy of policy issued by opposite party in favour deceased Muthaiah, dt. 19-04-2012.

Ex.A2:-Claim application along with relevant documents submitted by the complainant to opposite party No.1.

Ex.A3:-Repudiation letter issued opposite parties dt. 27-12-2012.

Ex.A4:-Application submitted by the complainant to opposite parties for reconsideration, dt. 12-08-2013 along with postal receipts (2) and acknowledgement (1) dt. 19-08-2013.

Ex.A5:-Reply given by opposite party No.3 to the complainant dt. 16-09-2013.

4.      On receipt of the notice, the opposite parties appeared through its counsel and filed counter.  In their counter the opposite parties submitted that the complainant filed by the complainant does not fall within the definition of consumer dispute under consumer protection Act,1986,  as there is neither any unfair trade practices adopted nor any deficiency is being established against the opposite parties hence the averments and allegations made there in are frivolous, baseless and misconceived, and complaint is liable for rejection and the same may be rejected.  The opposite parties also submitted that the complainant has not approached the Forum with clean hands and suppressed the material facts, the claim made by the complainant was repudiated by the opposite parties for the reason of misrepresentation of material facts by the deceased life assured at the time of making the proposal. The opposite parties also submitted that the Hon’ble Supreme Court of India in the case of Satwant Kaur andhu V. New India Assurance company Limited  (2009) 8 SCC 316 as referred the term proposal Form as defined under the insurance regulatory and development authority, 2002 as a “Form” to be filled by the proposer for insurance, for furnishing all material information required by the insurer to decide whether to accept for decline, to  undertake the risk and in the event of acceptance of the risk, to determine the rates, terms and conditions of a cover to be granted, and also observed that in a contract insurance, any fact which would influence the mind of prudent insurer in deciding whether to accept or not to accept the risk is “material fact”.  If the proposer has knowledge of such fact, he is obliged to disclose it particularly while answering question in the proposal form.   The opposite parties also submitted that the complainant has no locus standi to claim, as the insurance policy was obtained by the DLI by miss-representation in order to defraud.

5.      The opposite parties admitted that the life assured Muthaiah after understanding the terms and conditions of the insurance product “BSLI Vision Plan had voluntarily applied for an insurance policy vide proposal Form bearing No. A455581320 dated. 18-04-2012 where in the complainant was proposed as nominee.  The opposite parties also submitted that the DLI in the copies of the application it is informed that pertaining to personal, life style and medical details of the life to be insured in the said set of questionnaire at question 13 (b) (iv) was given and following questions were answered negative by DLI. 

Q.no. 13 Personal, Life Style and Medical details of the Life to be insured.

B. Life style information.

IV Do you consumer or have you in the past consumed alcohol or tobacco? If yes give details?

For the above questions was answered in negative by DLI.  The opposite parties also submitted that in the said proposal form, which was duly signed by the DLI contained the following declaration by the life assured.  The opposite parties also relied on section 45 of Insurance Act, 1938 ; No policy of life insurance affected before the commencement of this Act shall after the expiry of two years from the date of commencement of this Act and no policy of life insurance is affected be called in question by an insurer on the ground that statement made in the proposal or in a any report of a medical officer, or referee, or friend of the life assured or in any other documents leading to the issue of the policy was in accurate or false, unless the insurer shows that such statement was on a material matter or suppressed facts which it was material to disclose and that is was fraudulently made by the policy holder and that the policyholder knew at the time of making it that the statement was false or that it suppressed facts which it was material to disclose.  The opposite parties also submitted that on 28-11-2012 they received a death claim intimation along with the claimants statements, death certificate of the deceased policy holder whereby the opposite parties were given to understand that the deceased policy holder died suddenly on 05-08-2012 due to Jaundice.  Upon receipt of the death claim by the opposite parties, as per the procedure they investigated the matter and during the course of investigation it was established that death certificate produced by the complainant at the time of claim is fake document and during the investigation it was established that the DLI was Alcoholic prior to his application for insurance.   The opposite parties also submitted that the DLI suffered with lever disease since 10 years and finally died to its complications at Sharada Nursing Home, the said nursing home had issued a certificate dated 18-12-2012 which stated that the DLI had died on 25-04-2012 in the hospital.  The opposite parties also submitted that during the investigation the claim of Rs.30,000/- was forwarded by Kinnera District Women Samakhya and LIC claim details were available with DRDA authorities and also that the opposite parties submitted the treatment records itself is proof that the DLI was an alcoholic and the said policy contract was purchased by the DLA two days earlier to his hospitalization, and copes of medical record and Kinnera District Samkhya are annexed.   The opposite parties also submitted that the DLA actually died on 25-04-2012 and the panchayathi authorities issued certificate on 27-04-2012 confirming the same, based on above mentioned observations it reflects that the material details affecting the decision of the insurer for the acceptance or rejection of the contract of insurance and the DLI suppressed the material information and the same was not disclosed by him at time of signing the said application in spite of the specific questions asked in the proposal Form therefore the claim was rightly repudiated and the same was informed by the complainant vide letter dated 27-12-2012.   The opposite parties also submitted that the contract of insurance being of utmost good faith, DLI was under an obligation to disclose the material details in the proposal Form which are necessary to be answered for the purpose of determine the risk under the said policy were intentionally answered in negative and they have rightly repudiated the claim of the complainant on the ground of suppression of material facts.  To support their case they relied on the Judgment of the Hon’ble Supreme Court in United India Insurance Company V. MKJ Corporation (1996) 6 SCC 428, Life Insurance Corporation India V. Smt. Surekha Shankar Jadhav (NC), RP 2130 of 2007 dated 31-07-2012 wherein it was observed held that the insurance company can repudiate a claim in case of non disclosure of pre existing disease or any material information and the same may or may not be the exact cause of death of the deceased life assured.  The opposite parties also submitted that the complainant failed to attribute any deficiency of service and unfair trade practice against the opposite parties as such prayed to dismiss the complaint.   

6.         On behalf of the opposite parties the following documents are filed and marked as exhibits B1 to B10

Ex.B1:-Proposal Form, dt. 18-04-2012.

Ex.B2:-Claimants statement.

Ex.B3:-Death claim intimation Form.

Ex.B4:-Medical Reports from care diagnostic centre dt. 04-08-2012.

Ex.B5:-Doctor consultation prescriptions of Dr. Kasim dt. 04-08-2012.

Ex.B6:-Two invoice receipts from Venkatasai Medical and General Stores, Venganapalem, Khammam District.

Ex.B7:-Original death certificate issued by Gramapanchayath Gundepudi, Julurpahad Mandal, Khammam District.

Ex.B8:-Declaration and Authorization dt. 28-11-2012.

Ex.B9:-Original Medical Attendance certificate issued by Dr. Kasim and claim settlement letter of claimant.

Ex.B10:-Original Policy document, schedule, and terms & conditions.

7.      Upon perusing the material papers 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:-

                   In this case, the husband of the complainant had taken Birla Sun Life insurance policy, sum assured is Rs.4,50,000/- from opposite party No.1.  The life assured died on 05-08-2012 due to Jaundice.  According to the complainant after death of her husband she submitted claim application on 08-09-2012 to opposite parties for getting death claim by producing death certificate of her husband, but the opposite party No.2 rejected the claim of the complainant on 27-12-2012 by giving false reasons that the the husband of the complainant, Muthaiah died prior to the date mentioned in the death certificate and the same was informed to the complainant and also advised the complainant to approach claims redressal i.e. opposite party no.3.  according to the complainant as per the advise of Opposite party No.2 she filed an application on 12-08-2013 before the opposite party No.3 for reconsideration of the claim, the opposite parties failed to settle the claim and intentionally dragging the matter as such the complainant approached the Forum for redressal.              

                    From the documents and material available on record, the question for consideration before us is, whether the life assured suppressed the material fact that the DLI suppressed the material information and the same was not disclosed by him at the time of submitting proposal form? In this regard the evidence available on the record means to be scrutinized strictly.  From the documents, Ex.B4 & B5 the life assured had taken treatment on 04-08-2012 in the hospital of Dr. Kasim.  And also as per exhibit Ex. B7 the deceased that is the husband of the complainant died on 05-08-2012.   The opposite parties in their counter they submitted that the husband of the complainant died on 27-04-2012, except their plea they failed to produce any documentary evidence.  It is also the case of the opposite parties that, the life assured suppressed the material facts about his health and obtained the policy but to disprove the same the opposite parties failed to produce any evidence. 

                    The opposite parties in their counter submitted that the life assured has suppressed his health at the time of proposal for life insurance, if the health of the life assured was correctly disclosed the opposite parties would not have been accepted the proposal and issued the policy to the life assured by assuming the risk associated with the policy. 

                    From the above we do not found any merits in the contention raised on behalf of the opposite parties.  And also we observed that the opposite parties failed to produce any documentary evidence to support their case.  From the documents available on record, we are of the opinion that without the support of the documents, the objection taken by the opposite parties that the life assured actually died on 25-04-2012 and the Panchayath Authorities had issued certificate on 27-04-2012 and the life assured had suppressed the material facts pertaining to his health, which cannot be taken into consideration.  The judgments relied on behalf of the opposite parties are not applicable to the present case.  In view of the above, we are of the opinion that the complainant is entitled for the policy amount of Rs.4,50,000/- Plus Additional benefit covered under the policy.   As such this point is answered accordingly in favour of the complainant.

Point No.2:-

In the result, the complaint is allowed in part, directing the opposite parties No.1 to 3 to pay the Policy Insurance Cover amount of Rs.4,50,000/- Plus Additional Benefit covered under the policy, together with interest @9% p.a. from  the date of complaint i.e. 27-09-2013 till actual payment and also awarded Rs.3000/- towards costs of the litigation.  The opposite parties are directed to deposit the amount within one month from the date of receipt of this order.

            Typed to dictation, corrected and pronounced by us, in the open Forum, on this the  5^th day of January, 2015.

               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.