Complaint is filed on 27-07-2009
Compliant disposed on 28-9-2010
BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM
::AT:: KARIMNAGAR
PRESENT: HON’BLE SRI K. DEVI PRASAD, B.Sc., LL.B., PRESIDENT
SMT. E. LAXMI, M.A.,LL.M.,PGDCA (CONSUMER AWARENESS), MEMBER
SRI. K. CHANDRA MOHAN RAO, B.Com., LL.B., MEMBER
TUESDAY, THE TWENTYEIGHTH DAY OF SEPTEMBER, TWO THOUSAND TEN
CONSUMER COMPLAINT NO. 114 OF 2009
Between:
Boddula Devendra @ Devi, W/o. Late Boddula Rajaiah, Age 29 years, Occ: Kirana Shop and Agriculture, R/o. Seethampalli, Post: Kammapalli mandal Mutharam, district Karimnagar.
… Complainant
AND
Life Insurance Corporation of India, Peddapally branch, Peddapally proper and mandal, district Karimnagar, R/by it’s Manager.
…Opposite Party
This complaint is coming up before us for final hearing on 10-9-2010, in the presence of Sri B.Srinivas and Smt. B. Geetharani, Advocates for complainant and Sri J. Sriramulu, Advocate for opposite party, and on perusing the material papers on record, and having stood over for consideration this day, the Forum passed the following:
:: ORDER ::
1. This complaint is filed under Section 12 of C.P. Act, 1986 seeking direction to the opposite party to pay an amount of Rs.5,00,000/- with interest, damages and costs.
2. The brief averments of the complaint are that the husband of the complainant B.Rajaiah obtained Life Insurance policy for an assured sum of Rs.5 lakhs on 28.1.2002 from the opposite party and he nominated the complainant as his nominee. The opposite party issued policy No.683409221 by receiving half yearly premium of Rs.12,535/-. As per the terms and conditions of the policy the opposite party promised to pay Rs.5 lakhs with bonus in case of death of the policy holders. Her husband died on 30.10.2004 and within one month from the date of death the complainant made a claim for payment of the sum assured by submitting the relevant documents in proof of death of her husband. But the opposite party failed to settle the claim and postponed on one or other pretext. Therefore, the complainant got issued a Legal Notice to the opposite party on 7.7.2009 calling upon them to pay the sum assured, but inspite of it opposite party failed to settle the claim. Therefore, complainant sought direction for payment of the sum assured with benefits, interest, damages and costs.
3. The opposite party filed counter praying for dismissal of the complaint on the ground that the claim is barred by limitation provided under Sec 24A of C.P.Act, 1986. It is submitted that the husband of the complainant obtained Insurance Policy for Rs.5 lakhs on 30.1.2002 by submitting a proposal. Subsequently the said policy had lapsed due to non-payment of premium by him from July 2002 to January 2004. Thereafter the policy holder submitted a revival letter to revive the policy on 15.4.2004 under loan cum revival scheme. Along with the revival application he submitted a personal statement regarding his health in form no.680 Dt: 29.3.2004 along with medical report and declaration stating that he is not suffering from any ill-health. The revival premium was paid by obtaining a loan on the policy. Basing on his declaration only the policy was revived. On receipt of death intimation from the complainant that her husband died on 30.10.2004 due to Jaundice, the opposite party caused enquiry regarding the death of policy holder. On which it is revealed that the policy holder was suffering from Acute Viral Hepatitis and he was admitted in Kasturiba Hospital, Sewagram, Waradha in Maharashtra as inpatient in Male Medical Ward on 15.4.2004 with MRD No.38114 and was discharged on 18.4.2004. The medical report reveals that he was suffering from ill-health 15 days prior to admission and he was suffering from liver enlargement and he was advised for continuous medical treatment. While submitting the revival form and also during medical check-up the policy holder suppressed his ill-health and obtained the revival by mis-representation. Basing on the said medical report the opposite party repudiated the claim and sent a repudiation letter Dt: 9.11.2006 informing about rejection of her claim. Thereafter the complainant did not make any claim during a period of 2½ years, but filed the present complaint making an allegation that no reply is given to the claim made by her. It is further submitted that the complainant is not entitled for the sum assured as the policy holder got the revival by suppression of material information about his health and the complaint is barred by limitation. As there is no deficiency of service on their part, the opposite party prayed for dismissal of the complaint.
4. The complainant filed Proof Affidavit reiterating the averments made in the complaint and filed documents which are marked under Ex.A1 to A4. Ex.A1 is the Status Report of Policy No. 683409221 Dt: 1.7.2009. Ex.A2 is the original Death Certificate issued by Grampanchayat Seethampeta Dt: 14.7.2005. Ex.A3 is the office copy of Legal Notice got issued by complainant Dt: 7.7.2009. Ex.A4 is the receipt of Professional Courier addressed to opposite party Dt: 9.7.2009.
5. The opposite party filed Proof Affidavit of its Administrative Officer reiterating the averments made in the counter and filed documents marked under Ex.B1 to B12. Ex.B1 is the original Loan cum Revival letter from complainant addressed to opposite party. Ex.B2 is the Personal Statement Regarding Health Dt: 29.3.2004. Ex.B3 is the Special Examiner’s Confidential Report Dt: 29.03.2004. Ex.B4 is the original Insurance Policy no.683409221 Dt: 8.2.2002. Ex.B5 is the proposal for insurance on own life Dt: 30.1.2002. Ex.B6 is the Ordinary Revival Quotation of policy no.683409221 Dt: 13.4.2004. Ex.B7 is the letter from opposite party addressed to deceased Dt: 15.4.2004. Ex.B8 is the letter from complainant addressed to opposite party in respect of death claim benefits. Ex.B9 is the Claimant’s Statement of opposite party. Ex.B10 is the photo copy of Out Patient Record of B.Raju issued by Kasturba Hospital Sevagram. Ex.B11 is the photo copy of Discharge Summary of B.Raju Ramlu Dt: 15.4.2004 issued by Mahatma Gandhi Institute of Medical Sciences, Kasturba Hospital, Sewagram, Department of Medicine. Ex.B12 is the letter from opposite party addressed to deceased Dt: 9.11.2006 in respect of Death Claim.
6. The points for consideration are:
(1). Whether there is any deficiency of service on the part of opposite party?
(2). If so, to what relief the complainant is entitled?
7. Heard both sides.
8. It is contended by the learned counsel for the complainant that the opposite party issued Life Insurance Policy under Ex.B4 on the life of B.Rajaiah for an assured sum of Rs.5 lakhs. As the said policy was lapsed due to non-payment of premium from July 2002 to January 2004, a revival letter was submitted by the policy holder on 29.3.2004. On which the said policy was revived by collecting the premiums on 15.4.2004. Prior to acceptance of the policy the policy holder underwent medical examination by the Panel Doctor of opposite party who has certified that the policy holder was in good health. The arrears of premium was adjusted by granting loan on the policy. After the death of policy holder a claim for payment of sum assured was made by the complainant, but the opposite party did not settle the claim even after service of Legal Notice under Ex.A3. It is further contended that the opposite party repudiated the claim on false grounds that the policy holder was suffering from serious illness at the time of submitting the revival application and that he submitted a false declaration about his ill-health. It is further contended that the opposite party did not serve the letter of repudiation under Ex.B12 as such the claim of the complainant is still pending. The complainant claimed for an order for payment of the sum assured.
9. It is contended by the opposite party that the complaint is barred by limitation as it is filed beyond the period of limitation provided under the provisions of Sec 24 of C.P.Act and relied on the judgment of Hon’ble National Commission reported in 2009 (2) CPR 257 page. It is further contended that the policy taken by the deceased was lapsed for non-payment of the premium from July 2002 to January 2004. On 15.4.2004 the policy holder submitted a letter under Ex.B1 for revival of the policy with a request to grant loan on the policy bond and adjust the loan amount towards arrears of premium. At the time of revival he has submitted personal statement of health under Ex.B2 declaring that he is not suffering from any ill-ness. Basing on his declaration only the policy was revived. Subsequently a death claim was received from the complainant for payment of the sum assured. When enquiry was made by the opposite party it has come to light that the policy holder was admitted in Mahatma Gandhi Institute of Medical Sciences, Kasturiba Hospital, Sewagram on 15.4.2004 for Acute Viral Hepatitis in which it is mentioned that he was suffering from Jaundice for a period of one month before admission in the hospital. Therefore, as on the date of revival of the policy, the policy holder was suffering from acute ill health, but while submitting statement of health he has suppressed the same. Therefore, no amount is payable under the policy hence opposite party prayed for dismissal of the complaint.
10. The case of the complainant is that the husband of the complainant obtained Life Insurance Policy from the opposite party for an assured sum of Rs.5 lakhs on 28.1.2002 and that the policy holder died on 30.10.2004. Inspite of submission of the claim the opposite party failed to pay the sum assured. A perusal of the Status Report under Ex.A1 and Policy Bond under Ex.B4 it is established that the policy holder B.Rajaiah obtained Jeevansri Policy by making a proposal on 30.1.2002 and he nominated the complainant as nominee under the said policy. As per the terms and conditions of the policy the opposite party promised to pay Rs.5 lakhs with eligible bonus in case of death of the policy holder. The said policy was in lapsed condition during the period from July 2002 to January 2004 for non-payment of Insurance Premium. On 15.4.2004 the policy holder submitted letter under Ex.B1 requesting the opposite party to revive the policy by granting loan for adjustment of Insurance premium. As required under the policy conditions the policy holder submitted a Personal Statement regarding his health declaring that he is not suffering from any ill-ness. Basing on his personal declaration the opposite party revived the policy be adjusting the loan amount towards arrears of premium as show in revival quotation under Ex.B6.
11. The complainant submitted a letter under Ex.B8 informing the opposite party that her husband died on 30.10.2004 due to Jaundice and liver infection and requested the opposite party to pay the sum assured. After receipt of the claim the opposite party caused an enquiry into the death of the policy holder as he died within one year from the date of revival. On enquiry it has come to light that the policy holder was suffering from Jaundice and infection to the liver for which he was admitted in Kasturba Hospital Sewagram on 15.4.2004. A perusal of out patient record under Ex.B10 and Case Sheet under Ex.B11 discloses that the policy holder was suffering from Acute Viral Hepatitis for more than 1½ month and there was enlargement of liver. He was treated as inpatient and discharged from the hospital on 18.4.2004. The policy was in lapsed condition from July 2002 to January 2004 but the policy holder requested for revival only in the month of April 2004 i.e. on 15.4.2004. The policy holder suppressed about his ill-health on 15.4.2004 at the time of revival of the policy. After making enquiries by opposite party about the admission of the policy holder it has come to the knowledge of the opposite party that the policy holder by concealing his illness revived the policy by paying lapsed premiums. Therefore, the opposite party repudiated the claim through Ex.B12. Further, opposite party revived the policy in good faith. After knowing about the disease the complainant paid lapsed premium and got revived the policy on the same day of his admission in Kasturba Hospital Sewagram i.e. 15.4.2004.
12. The complainant contended that there was no repudiation of policy till today. Though the letter under Ex.B12 filed by opposite party discloses that the claim of the complainant was repudiated, the opposite party did not file acknowledgement of registered letter Dt: 9.11.2006. Therefore, the plea that the complainant made time barred claim after the period of 32 months is not tenable. The decision rendered by the Hon’ble National Commission reported in 2009 (2) CPR 257 in which it is held that “one a cause of action arose for filing complaint, making of any subsequent representation could not extend period of limitation” is not applicable to this case as no acknowledgement or any proof of dispatch of repudiation letter is filed by the opposite party. Therefore, service of Legal Notice is the basis to file the claim.
13. It is contended by the complainant that the opposite party revived the policy after subjecting the policy holder for medical examination to ascertain the health condition of the policy holder. The complainant relied on the judgment of Hon’ble National Commission reported in 2005 (2) CPR 86 in which it is held that “Where Life Insurance Policy was issued on 16.8.1994 and insured died on 30.8.1994, policy could not have been repudiated on ground that half yearly premium which fall due on 28.6.1994 had not been paid.” The said judgment is not applicable to the facts of this case. In the present case it appears from Ex.B3 Medical Examiner’s Confidential Report issued by Dr.Suresh Kumar, Sri Sai Clinic, Mantheni who signed on 29.3.2004 ascertaining the health condition of policy holder. But as stated in Ex.B10 and B11 that on 15.4.2004 the policy holder was admitted in Kasturba Hospital, Sewagram with the complaint of Jaundice and Acute Viral Hepatitis. Thus it is clear from Ex.B3 the report of Doctor who issued much earlier to the date of revival i.e. 15.4.2004 that the policy holder was suffering from Jaundice and Acute Viral Hepatitis since 1½ months prior to his admission. The health condition of the policy holder was noted in Ex.B10 as per his version. This shows that the policy holder was not fair while informing his health condition to Dr.Suresh Kumar at the time of revival of the lapsed policy.
The complainant further relied on the judgment of Hon’ble National Commission reported in 2007 (1) CPR 249 where in it is held that “Hospitalization for fever rigour pain in throat and difficulty in swallowing eight months before death of insured due to heart attack could not be said to be a suppression of material fact by insured so as to disentitle to claim under Life Insurance Policy”. This judgment is not applicable to the facts of this case as at the time of revival of the policy the policy holder suppressed his health condition to Dr.Suresh Kumar. Further the observations in Ex.B10 and Ex.B11 disclosed that the policy holder was suffering with Jaundice and Acute Viral Hepatitis since 1½ months prior to his approach Kasturba Hospital Sewagram i.e. 15.4.2004.
In another judgment of Hon’ble State Commission reported in 2009 (1) CPR 307, it is held “Where disease was not in the knowledge of the complainant, repudiation of claim of the insured complainant on ground of suppression of disease would be deficiency in service.” In another judgment rendered by Hon’ble Jammu & Kashmir State Commission reported in 2005 (2) CPR 356 it is held that “Before repudiating claim under Life Insurance Policy on ground of concealment of material fact, it is incumbent upon Insurance Co. to prove previous disease, nexus between such disease and cause of death and the fact that insured had knowledge of such previous disease and he suppressed it”. The facts of the said authorities are not applicable to the present case. As stated supra the policy holder knowing well about his health condition suppressed the same at the time of informing to Dr.Suresh Kumar and got revived the lapsed policy. Therefore, the facts mentioned above amply proved that the cause of death was due to Jaundice and Liver infection which is supported by the death intimation letter under Ex.B8 and B9 filed by the complainant to the opposite party. Therefore, it is established through Ex.B10 and B11 that B.Raju S/o.Ramulu R/o. Seethampally of Mutharam Mandal was admitted in Kasturba Hospital Sewagram on 15.4.2004 and discharged on 18.4.2004, who is none else than the husband of the complainant i.e. policy holder B.Rajaiah.
14. The opposite party revived the policy under good faith basing on the declaration of health submitted by the policy holder. But the medical records Ex.B10 and B11 and claim letter under Ex.B8 and Ex.B9 submitted by the complainant clearly disclosed that the policy holder was suffering with Acute Viral Hepatitis and having full knowledge of the consequences of the disease got the policy renewed to make a claim. The contract of Insurance is based on good faith and the policy holder must also disclose the correct particulars of his health. Had the policy holder declared about his ill health in the Personal Statement under Ex.B2 Dt: 15.4.2004 at the time of revival the opposite party would have rejected the revival of the policy. The documentary proof clearly established that the policy holder suppressed his illness and got the policy revived with a view to claim Insurance amount. Therefore, the opposite party was right in repudiating the claim. There is no deficiency of service on the part of opposite party in settling the claim of the complainant. Since the policy was revived by concealment of illness the opposite party is not under any obligation to pay the sum assured under the policy. In the above circumstances we hold that the complainant is not entitled for the relief sought in the case and her complaint deserves to be dismissed.
15. In the result the complaint is dismissed without costs.
Typed to my dictation by Stenographer and after correction the orders pronounced by us in the open court this the 28th day of September, 2010.
Sd/- Sd/- Sd/-
MEMBER MEMBER PRESIDENT
NO ORAL EVIDENCE HAS BEEN ADDUCED ON EITHER SIDE
FOR COMPLAINANT:
Ex.A1 is the Status Report of Policy No. 683409221 Dt: 1.7.2009.
Ex.A2 is the original Death Certificate issued by Grampanchayat Seethampeta Dt: 14.7.2005.
Ex.A3 is the office copy of Legal Notice got issued by complainant Dt: 7.7.2009.
Ex.A4 is the receipt of Professional Courier addressed to opposite party Dt: 9.7.2009.
FOR OPPOSITE PARTIES:
Ex.B1 is the original Loan cum Revival letter from complainant addressed to opposite party.
Ex.B2 is the Personal Statement Regarding Health Dt: 29.3.2004.
Ex.B3 is the Special Examiner’s Confidential Report Dt: 29.03.2004.
Ex.B4 is the original Insurance Policy no.683409221 Dt: 8.2.2002.
Ex.B5 is the proposal for insurance on own life Dt: 30.1.2002.
Ex.B6 is the Ordinary Revival Quotation of policy no.683409221 Dt: 13.4.2004.
Ex.B7 is the letter from opposite party addressed to deceased Dt: 15.4.2004.
Ex.B8 is the letter from complainant addressed to opposite party in respect of death claim benefits.
Ex.B9 is the Claimant’s Statement of opposite party.
Ex.B10 is the photo copy of Out Patient Record of B.Raju issued by Kasturba Hospital Sevagram.
Ex.B11 is the photo copy of Discharge Summary of B.Raju Ramlu Dt: 15.4.2004 issued by Mahatma Gandhi Institute of Medical Sciences, Kasturba Hospital, Sewagram, Department of Medicine.
Ex.B12 is the letter from opposite party addressed to deceased Dt: 9.11.2006 in respect of Death Claim.
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MEMBER MEMBER PRESIDENT
