1. The brief history of the case of the complainant is that her husband, Ramachandra Gouda during his life time had obtained an insurance policy from the Ops vide Policy No.1K341425402 with date of commencement 18.12.2017 for a basic sum assured of Rs.5, 00,000/-. It is submitted that the life assured died on 09.02.2018 and the present complainant being the nominee had filed claim application before the Ops for getting maturity value under the subject policy. It is further submitted that the Ops refunded the premium amount of Rs.50, 000/- so deposited, to the bank accounts of the complainant but failed to settle the death claim in favour of the complainant-nominee. Thus alleging deficiency in service on the part of the Ops, she filed this case praying the Forum to direct the Ops to pay Rs.5.00 lacs towards settlement of death claim and to pay Rs.300/- per day towards compensation for harassment besides Rs.5000/- towards cost of litigation to the complainant.
2. The Opp. Parties filed counter in joint denying the allegations of the complainant but admitted about SBI Life – Smart Wealth Builder policy bearing No.1K341425402 with date of commencement 18.12.2017 issued in favour of the LA, Ramachandra Gouda for a basic sum assured of Rs.5.00 lacs on receipt of necessary documents and premium of Rs.50, 000/-. It is submitted that the LA (Life Assured) was died on 09.02.2018 and during death claim investigation it was revealed that the DLA (Deceased Life Assured) was suffering from Diabetes Mellitus, Heart Disease and Lungs Disease and was under treatment for the same at Queen’s NRI, Hospital, Visakhapatnam. As per discharge summery, the LA was admitted there on 10.08.2016 and was discharged on the same day on 10.08.2016 with Coronary Angiogram. The Ops submitted that the LA did not disclose the material facts regarding his pre-existing illness during proposal and procured the insurance cover fraudulently and thus it is evident that there is a deliberate suppression of material fact. The Ops also further submitted that the claim under the policy was repudiated as per terms and conditions of the policy and the premium amount of Rs.50, 000/- paid under the policy was refunded to the accounts of the complainant on 31.12.2018 and the decision to repudiate the claim was communicated to the complainant vide claim repudiation letter dt.09.01.2019. With these and other grounds, denying any deficiency in service on their part, the Ops prayed to dismiss the case of the complainant with cost to the Company.
3. The complainant has filed certain documents along with citations in support of her case. The Ops have filed bunch of documents, affidavit of evidence, amendment written statement, citations etc. in support of their case. Heard from the parties through their respective A/Rs at length on virtual mode and perused the materials available on record minutely.
4. In this Life Insurance Policy bearing No.1K341425402 for a sum assured of Rs.5, 00,000/- with premium of Rs.50, 000/- and date of commencement in favour of the husband of the compliant granted by the Ops are all admitted facts. As per record, it is also a fact that the present complainant is the legal heir of the life assured and the nominee under the policy and the LA died on 09.02.2018. It is further an admitted fact that the present complainant being the nominee has filed claim application and the Ops have returned the premium amount of Rs.50, 000/- taken by them to the bank account of the complainant on 31.12.2018 and the decision to the repudiation of claim was communicated to the complainant vide claim repudiation letter dt.09.01.2019 with the reason that the DLA had suppressed the material facts regarding his previous illness at the time of proposal.
5. From the rival contentions of the parties the following issues emerge importance for consideration and just decision of the case. (1) Whether the DLA had suppressed material facts regarding his previous illness during proposal of Insurance, (2) whether previous illness of the DLA if any has a direct nexus to his death, (3) whether repudiation of death claim by the OP is just and proper, (4) whether the Ops committed any deficiency in service and (5) if so, as to what relief?
6. While deciding Issue No.1 it is seen from the counter and documents of the Ops that the DLA was admitted at Queen’s NRI Hospital, VSP on 10.08.2016 and was discharged on the same day after conducting Angiogram testing. On perusal of hospital record filed by the Ops, no bed was allotted to the DLA on 10.08.2016 in that hospital and hence from the hospital papers available on record it is concluded that on 18.10.2016, the DLA was an outdoor patient of that hospital and was discharged on the same day and date. Further the DLA was a Govt. employee and the SBI Life Claim Investigation Report filed by the Ops clearly show that the DLA has never taken sick leave from his office on health ground. It is seen from the hospital prescription that the LA was suffering from T2 DM. It has been held by the higher courts that now a day’s Diabetes is not a disease but a cyclic imbalance of the human body to be maintained in day to day life. Further the DLA had got T2 DM but not acute which can be controlled on proper diet and medication. Further it is seen that the doctor found CAD (Coronary Artery Disease) with the DLA for which he only advised to take medicine for one month and kept the patient under observation. The DLA thereafter has never approached that hospital. The doctor at the hospital even did not feel it proper to advise anything except one month medication. In absence of any further treatment it can be held that the DLA was in good health and hence at the time of proposal he did not disclose his past illness. From the above discussions we come to the conclusion that the complainant had not disclosed regarding his past illness at the time of proposal with mala fide intention and non disclosure of his previous illness is not suppression of material fact in the proposal of insurance. The Issue No.1 is decided accordingly.
7. The Issue No.2 is whether previous illness of the DLA has a direct nexus to his death on 09.02.2018. It is seen from the record that the DLA was approached the hospital on 10.08.2016 as an outdoor patient and was discharged on the same date. The doctor found T2 DM, COAD and CAD with the DLA. The doctor conducted CAG (Coronary Angiogram) and prescribed 4 medicines for a month to use. After one month the DLA has not approached the said hospital and from this fact it is crystal clear that the DLA was cured by the medicines prescribed by the doctor. If the disease found in the body of the DLA was acute, the hospital could have advised the DLA to stay in the hospital as indoor patient for further treatment but the doctor did not do so feeling curable by medicines. Further the Ops stated that the patient was unwell since last 2-3 years and had admitted in Christian Hospital at Nabarangpur, Odisha but neither by the Ops nor in the SBI life claim investigation report it was proved that the DLA was unwell since long. No medical document from Christian hospital, Nabarangpur is filed in this case by the Ops. It is seen that the DLA was died at his home on 09.02.2018. Just before his death he had not been admitted in any hospital, whatever may be the cause of death not forthcoming from any source and no evidence is laid down to that respect. It is a settled principle of law that where cause of death of insured is not related directly or indirectly with the alleged undisclosed ailments insured was suffering at the time of taking the policy, claim should not be repudiated on the ground of suppression of material fact. Thus we found no nexus between the previous ailments of the DLA for his death at home. We have minutely perused the decisions filed by the both the parties available on record.
8. Now the 3rd issue has come up regarding repudiation of death claim. It is also a settled principle of law and as has been decided by higher Commissions under CPA that unless and until a person is hospitalised or has been undergone operation or admitted for the treatment of particular disease in the near proximity of obtaining policy or say a year or two before it, he is not supposed to disclose about his day to day problems such as hypertension, blood pressure, diabetes etc. as these are not such diseases for which he might have been hospitalised or undergone operation (SC Del-CPR May 2010 355). Further unless and until a person receives treatment for a particular disease or is hospitalised or operated upon for a disease in near proximity of taking of the policy that is before a year or so, he cannot be guilty of concealment of the factum of any pre-existing disease for which he might have landed in the hospital or received treatment for the long (SC Del CPR May-2010 (V) 366). From the above decision held by the Hon’ble Commission, it can be safely concluded that the claim to any insurance should not be and cannot be repudiated by taking a clue of remote reference but any so called disease from the discharge summery of the insured by invoking exclusion clause of “Pre-existing disease” or non disclosure of “pre-existing disease” unless the insured had concealed his hospitalisation or operation for the said disease undertaken in the reasonable near proximity as referred above. Therefore, the conclusion is that any malady which is controllable with medication and does not involve such a treatment that needs hospitalisation for days together or needs operation to cure is not a “disease” for the purpose of insurance policy. So the 3rd issue goes in favour of the complainant.
9. From the above discussions, we found ample deficiency in service on the part of the Ops. The Ops have repudiated the claim arbitrarily and without proper application of mind. C. P. Act is a beneficiary legislation and it cannot allow insurance co. to escape liability on technical grounds to deprive consumer of benefit to which it was entitled to. Where the Insurance Co. was having a defence that it is a case of breach of policy conditions then some cogent evidence should have been produced by the Company to substantiate his defence. Repudiation of claim by the Ops without any substance, in our opinion is a deficiency in service on their part and thus the complainant is entitled for the death claim benefit arising out of the death of her husband. In this case length of policy is not a material matter to consider by the Forum.
10. While assessing the claim it is seen that the Insurance Policy taken by the LA was for a sum assured of Rs.5, 00, 000/-. As we held that the repudiation is illegal and arbitrary, the present complainant being the nominee under the policy is entitled to get the sum assured with benefits attached to it minus Rs.50, 000/- as returned by the Ops to the complainant earlier. This awarded sum bears interest and we feel interest @ 9% p.a. from the date of repudiation i.e. 09.01.2019 will be just and proper in this case. In the peculiar circumstances of the case, we are not inclined to grant any compensation in favour of the complainant except a sum of Rse.5000/- towards cost of litigation.
11. Hence ordered that the complaint petition is allowed in part and the Ops 1 & 2 being jointly and severally liable are directed to settle the death claim of Rs.5, 00,000/- with attached benefits minus Rs.50, 000/- with interest @ 9% p.a. from 09.01.2019 and to pay Rs.5000/- towards cost of litigation in favour of the complainant within 30 days from the date of communication of this order.
(to dict.)
