This is a complaint filed under Section 12 of Consumer Protection Act for an order directing the opposite parties to pay ` 2,87,500 towards the policy benefit and compensation and the interest and the future interest with cost.

          The complainant’s case is that they are the wife and children of diseased Marimuthu who was the policy holder No: 794234436 and after his death the 1^st complainant applied for claim, but it was denied as the answer was given as negative in Column No.7 of nomination form.  The above said deceased Marmuthu was an illiterate hailing from Tamil Nadu and all the formalities and entries in the nomination form have done by 3^rd opposite party, the registered agent of opposite party No.1 and 2.   So the deceased was not aware of the incorrect.  Statement made in Column No.7, infact in column No.9, the details of previous policy has given that itself shows that the deceased has nothing to hide from the opposite parties.   If the policy nomination has to accompany with special medical reports, it was disclosed about other policy, it should have been done by the agent because the agent is felicitating the nomination.  All other procedure has been done by the agent and the opposite party should have verify the same before approval and acceptance of nomination form as the all particulars about the previous policies with the opposite parties.  The death of the policy holder is due to cervical spine injury caused due to fall on hard surface from high altitude.  The opposite parties denied the claim and benefits to the petitioner without considering the whole aspects and circumstances.   The denial of the claim is deficiency of service since the opposite parties are legally bound to give the claim amount to the petitioners.  Sum assured by the policy is 1 lakh and in the case of death due to accident the 1^st and 2^nd opposite parties ought to give ` 2 lakhs.  The opposite parties are jointly and severally liable to pay claim amount with compensation with interest for defective service and cost of the proceedings.  Hence this complaint.

          In pursuance to notice issued by the Forum both 1^st and 2^nd opposite parties appeared and filed their version.  According to 1^st and 2^nd opposite party the deceased Marimuthu was having three policies and not one policy as mentioned in the complaint.  The policy details are policy No: 79149409 for assured ` 50,000 with date of commencement of 19.12.1996 under Plan No.14 for 13 years.  The death claim under this policy has been settled on 16.10.2008 for ` 63,841 after deducting policy loan availed by the deceased with interest.  The second policy No: 794198274, sum assured for ` one lakh with date of commencement on 28.03.2007 under plan No:165 for 10 year.  This policy has completed on the basis of proposal dated 28.02.2007 submitted by the deceased.  The death claim benefit under the policy has been settled on 25.03.2009 for ` 1,99,184.  The third policy No: 794234436 for sum assured of ` one lakh with date of commencement of 24.03.07 under plan 165 for 10 years.  The policy has completed on the basis of proposal dated 14.03.2007 submittd by the deceased and the death claim under the policy was repudiated due to the non-disclosure of material facts. The complainant is trying to misguide the Forum by concealing the fact that the opposite parties has already settled the death claim benefit under first two policies. The third party was repudiated for non-disclosure of previous proposal dated 28.02.2007 which was completed as policy number 794198274 and the claim was settled on 25.03.2009.  The proposal dated 14.03.2007 for the alleged policy should have shown the previous proposal dated 28.02.07 for sum proposed ` one lakh.  The age of the proposed while submitting the two proposal was 53 years.  If the earlier proposal was shown the opposite party would have called for a report’s like ECG, FBS etc as per the underwriting procedure of the risk of the proposer and the underwriting procedure would have gone deep as the age of the proposer was 53 years and total sum under consideration would be ` 2 lakhs instead of one lakh.  The opposite parties may reject both the proposal or charge extra premium.  Two proposals were submitted within a period of two weeks through different agents. This has been done purposefully by the deceased to underestimate the risk while underwriting the proposal for insurance as the deceased was 53 years old.  If the agent had filled the proposal form, she had done it as the capacity as the agent of the proposer.  The opposite party did not authorize any agent to fill the proposal form. If the agent had filled the proposal, it was filled as per the information given by the proposer other wise the agent was not in a position to give the answers to question numbers 1, 2A, 2B, 4A, 4B, 5, 10 and 12.  All these columns are pertaining to the personal data of the deceased.  The deceased purposefully concealed the fact that he had submitted a proposal prior to the proposal.   This is to misguide the opposite parties to complete his second proposal. Moreover the deceased had signed the declaration at the bottom of the proposal form stating that “the foregoing statements and answers have been given by me after fully understanding the questions and the same are true and complete.”  Moreover the contents of the proposal form and documents have been fully explained by Sri. Nithyananda , MES Quarters, Kannur-7 who is an English knowing person connected to LIC.  Life insurance is a contract governed by the Indian Contract and any contract secured by suppression of concealment of facts misleading the other party and thereby wrongly securing consent is void.  Moreover the principles of insurance is utmost god faith and a duty is cast upon the proposer to disclose all the facts material to assessment of risk and such contract secured in violation of principles of utmost faith is void ab-initio.  It has to be assured that the insured had not violated any conditions of policy and that no claim must be honoured unless found to be genuine and legal.  Policay condition 5 is applicable in this case.  So the claim is repudiated as the grounds of non-disclosure of material facts and hence there is no defective service on the part of opposite parties. The deceased has concealed the material facts by answering No to question 7 of proposal form.  The complainant has filed this complaint to harass the opposite party.   Since there is no deficiency of service or unfair practice on the part of opposite party, the complaint is liable to be dismissed.

          Upon the above contentions the following issues have been raised for consideration.

1.         Whether there is any deficiency of service on the part of opposite parties?

2.         Whether the complainant is entitled to any relief?

3.         Relief and cost.

The evidence in the above case consists of the oral testimony of PW1, DW1 and DW2 and Exts.A1 to A3 and Ext.B1 to B8. 

          The case of the complainant is that opposite party’s denial of claim of the complainants with respect to the policy having No. 794234436 which is in the name of the deceased P. Marimuthu the husband of the first petitioner and father of the other petitioner by saying that they had given false answer to the question number 7 of the proposal for concealing the fact that the deceased had proposed another assurance of life is incorrect and the complainants are entitled to receive the assured amount as they are the legal heirs of the deceased Marimuthu in order to prove their case.  The first petitioner was examined as PW1 and documents such as copy of proposal form, Treatment certificate from Medical College, Calicut and repudiation letter.  In order to disprove the case opposite party also examined DW1 and 2 and produced documents such as attested copy of policy dated 28.03.2007, attested copy of proposal form dated 14.03.2007, letter dated 20.02.09 and 17.12.09, attested copies of policy dated 28.02.2007 attested copies of agent’s confidential report, copy of medical examiners confidential report etc.  Admittedly the complainant had taken three policies, out of which two of them were allowed by opposite parties.  Admittedly the opposite party repudiated the Ext.B1 policy dated 24.03.2007 having policy No.794234436 and Ext.B5 policy having NO.794198274 dated 28.03.2007 was settled.  The sole reason for repudiating the Ext.B1 policy is that the complainant not disclosed the fact that there is another policy previous to this.  But the Ext.B5 policy which was settled is issued after the issuance of policy Ext.B1. Ext.B1 policy was proposed on 16.03.2007 and policy certificate is dated 24.03.2007.  But Ext.B5 policy dated 28.03.2007 and proposal date is also on 28.03.2007.  So it is clear that Ext.B1 policy was issued prior to B5 and the B5 was settled and Ext.B1 policy is repudiated. So it is very clearly seen that Ext.B1 is the first policy and Ext.B5 was issued subsequently.  So the reason for repudiation is not been genuine one.  Moreover it is seen that the date in Ext.B6 ie proposal of B5 policy and the date is B7 the confidential report was seen corrected to 28.02.07. But in Ext.B7 it was same as 28.03.2007.  So it is clear that the opposite parties have corrected the date in B6 and B7 policy in order to substantiate the contention of opposite party that Ext.B5 was settled since it was an earlier policy.  But the date in B1 and B5 policies tell the truth that Ext.B1 is the first policy taken by the complainant and hence the answer to question No.7 of proposal form is seen correct.  So we are of the opinion that there is grevious deficiency on the part of opposite party in repudiating the claim as well as by correcting Ext.B6 and B7 document.   So the complainants are entitled to the claim amount along with ` 10,000 as compensation and ` 1000 as cost of the proceedings and passed orders accordingly. 3^rd opposite party is exonerated from her liability.

          In the result the complaint is allowed directing the 1^st and 2^nd opposite parties to pay the claim amount to the complainant along with `10,000 (Rupees Ten Thousand only)  as compensation and  `1000 (Rupees One Thousand only) as cost of the proceedings to the complainant within 30 days of receipt of this order, otherwise the complainants are entitled to execute the order as per the provisions of Consumer Protection Act.

        Dated this the 30^th day of June, 2012.

                    Sd/-                          Sd/-  

       President                  Member                   

APPENDIX

Exhibits for the Complainant

A1.  Copy of proposal form.

A2.  Treatment certificate from Medical College, Kozhikode.

A3.  Repudiation letter.

Exhibits for the opposite party

B1.  Copy of policy dated 28.03.07.

B2.  Copy of proposal form dated 14.03.2007.

B3.  Copy of letter dated 20.02.09.

B4.  Copy of letter dated 17.12.09

B5.  Copy of policy dated 28.02.2007.

B6.  Copy of proposal form dated 28.02.07.

B7.  Attested copy of agent’s confidential report dated 28.02.07.

B8.  Copy of medical examiner’s confidential report dated 28.02.07.

Witness examined for the complainant

PW1.  Complainant No.1.

Witness examined for the opposite party

DW1.  B. Subha Naik.

DW2.  Latha N.

                                                                          /forwarded by order/

                                                                     SENIOR SUPERINTENDENT