This case is coming for final hearing on 24-06-2014 in the presence of Sri Adari Apparao, Advocate for the Complainant and of Sri D.Siva Prasad, Advocate for 1^st Opposite Party and 2^nd opposite party called absent and set exparte and having stood over till this date, the Forum delivered the following.                                                                                                                                             

: O R D E R :

(As per Smt. K.V.R.Maheswari, Honourable President(FAC) on behalf of the Bench)

1.       The Complainant’s husband Naga Nooka Apparao  during his life time took a life insurance policy from the opposite party vide policy No.00021121 and the commencement of the policy is 20.10.2008 and the complainant herein was a nominee.  While so, the complainant suffered from Jaundice and fever and joined in an Area Hospital of Anakapalli on 06.02.2009, the Doctor treated him as an out patient and prescribed some medicines.  But, he was not recovered and again she shifted to Area Hospital on 13.02.2009 doctor prescribed some medicines. While consuming medicines the insured died on 20.02.2009. 

2.       The complainant came to know about the insurance policy when she received the lapse letter from the opposite parties in the month of November, 2009, then, she approached the 2^nd opposite party and intimated the death of life assured and the 2^nd opposite party issued claim form to the complainant.  The complainant approached the 2^nd opposite party on 07.01.2010 with filled up claim form and with all other required documents and submitted those documents to the 2^nd opposite party.  The complainant contacted the 2^nd opposite party several times by way of phone call, but the officials did not give correct reply to the complainant.  Thereafter, investigators came to the house of the complainant in the month of June 2011 and enquired abut the death of insured as well as local people and also received required documents form the complainant.  On 06.03.2012, the investigator by name Maheswara Rao once again came to the complainant’s house collected the original policy bond, original death certificate and requested the complainant to submit treatment details, pan card copy, family photo of the nominee with the insured.  Claim form papers, Aadhar Card copy, Ration card copy and the bank account copy, which were already submitted to the 2^nd opposite party as well as the said investigator, but she once again submitted all these documents to the investigator and the investigator gave an acknowledgment. 

3.       The Complainant stated that she roamed around the offices of the opposite parties and enquired about her husband’s death claim and finally she came to know that her claim was repudiated and the 2^nd opposite party issued repudiation letter on 31.03.2012 alleged that “the insured was diagnosed of HIV and was under treatment for the same even prior to his application date. Therefore, regret that they are unable to honour the complainant’s claim and repudiate their liability under the policy”.  The Complainant’s stated that the opposite parties are intentionally avoiding settling the claim amount which amounts to deficiency of service and the acts of the opposite parties caused severe mental agony and hardship to the complainant.  Hence, this complaint to direct the opposite parties;

a) to pay claim amount of Rs.4,00,000/- with 24% p.a interest from November, 2009

b) to pay Rs.25,000/- towards compensation besides costs.

4.       On the otherhand, the 2^nd opposite party called absent and set exparte.

5.       The 1^st opposite party filed its counter and admitted the issuances of policy bearing No. 00021121 in the name of the complainant’s husband, but pleaded that the complainant has mischievously suppressed all the material facts and as per the investigation report submitted by the investigator, the life assured suppressed the known facts and that at the time of making application by fabricating the documents and obtained policy.  As per the investigation report, the said life assured died on 20.02.2009 within the short period of policy i.e., within four months due to HIV, then, the complainant has not come with clean hands and honest intentions before the Forum.  The Opposite party pleaded that it has repudiated the claim under Section-45 of the Insurance Act 1938, this section allows insurance companies to cancel the insurance policies which are issued on the basis of false information submitted by the proposer.  In this complaint, the complainant knowingly suppressed the material facts and the life assured known about the health conditions at the time of submitting the proposal form in order to obtain the policy.  Hence, the opposite party repudiate the claim of the complainant as per the policy conditions, as well as based on the principle of utmost good faith as the life assured suppressed known facts of the life assured and obtained the policy.  Hence, there is no cause of action and repudiation of the claim and the non payment of claim amount of the complainant is not at all amounts to deficiency of service on the part of the opposite party.  Hence, the complaint is to be dismissed.

6.       At the time of enquiry, the complainant filed affidavit along with documents which are marked as Exhibits A1 to A8.  The opposite party filed its counter and affidavit along with documents which are marked as Exhibits B1 to B4.  Both the counsels filed written arguments and heard both the counsels who reiterated their versions.

7.       In view of the respective contentions, the point that would arise for determination is:-

Whether the repudiation of the claim under the policy issued by the opposite parties is undisputed and amounts to deficiency in service and the complainant is entitled for claim amount and reliefs prayed for?

8.       Issuance of policy i.e., Ex.A1 is not in dispute.  As per the versions of the complainant, her husband suffered from jaundice and fever who joined in area hospital at Anakapalli on 06.02.2009 and an out patient ticket was issued by the opposite party on the same day i.e., Ex.A2, then, doctor prescribed some medicines, but he was not recovered and again joined in the hospital on 13.02.2009 as per Ex.A3 and doctor prescribed some medicines like Syrup Liv-52 and the doctor mentioned in that prescription S.Bilirubin and some tablets, but while consuming medicines the life assured died on 20.02.2009.  The opposite party issued a lapse letter on 20.02.2009 i.e., Ex.A4 regarding the premium amount to be paid by the life assured.  After receiving Ex.A4 i.e., lapse letter, the complainant came to know about the policy of the deceased life assured.  Then, she submitted all the documents to the 2^nd opposite party but they failed to settle the policy amount. 

9.       The investigator by name Maheswara Rao came to the complainant’s house on 06.03.2012 and the complainant submitted a letter to the investigator on 06.03.2012 i.e., Ex.A6.  The investigator received the documents and gave an acknowledgment to the complainant i.e., Ex.A7 on the same day.  Ex.A8 is the repudiation letter issued by the opposite party stating that the life assured was diagnosed of HIV and was under treatment even prior to his application date and replies to the question given by the life insurance company in the application form are incorrect, as much as they hold documentary proof in support of the same.  With these reasons they repudiate the claim amount, but the complainant denied that her husband not suffered from HIV and he is not at all alcoholic and asserts that the death was due to jaundice only and there was no suppression of pre-existing decease, the opposite party is relying on the investigators report which is not supported with any documentary evidence.  Ex.A5 is the death certificate of the life assured.

10.     The main contention of the opposite party is that the life assured had pre-existing decease and he has under treatment while applying for policy and he died only because of HIV and another contention of opposite party is that the life assured died within four months from the date of obtaining policy. 

11.     The first plea of the opposite party regarding the pre-existing decease and the death occurred to the life assured because of the HIV.  In our view, the opposite party totally depends only on the investigators report i.e., Ex.A3 but the investigators report is not supported by any medical record, regarding the suppression of material facts as the life assured is taking the medicines for his treatment as HIV patient.  Ex.B1 is the copy of the policy and Ex.B2 is the attested copy of proposal.  Ex.B4 is the copy of the repudiation letter. 

12.     The 2^nd plea of the opposite party is that the life assured died within four month after obtaining the policy, hence in its view, the life assured might have suffered with some pre-existing decease and he died only because of HIV.  The opposite party relied upon Section-45 of Insurance Act 1938 and pleaded that the complainant and the life assured intentionally suppressed the material facts and the life assured knew about his health condition at the time of submitting proposal form.  The opposite party relied upon;

i) Mithoolal Nayak Vs Life Insurance Corporation of India reported in AIR 1962 SC 814 held that refer to Section-45 of Act if the policy holder suppressed the known facts, thereby the company is not liable to pay the sum assured. 

ii) 2008 ACJ SC 456 (PC Chacko and another Vs LIC of India wherein it was held that if the answers given by the insured in the proposal form if found incorrect, the sum assured is not at all payable.

iii) 2010 ACJ SC 265 (Satwan Kaur Sandhu Vs New India Assurance Co. Ltd.) held that if the policy holder died within short period after obtaining the policy, same is amounts to suppression of facts and the insurance company is not at all liable to pay the sum assured.

iv) 2004 NCJ SC 828 United India Insurance Co. Vs. Harcand Rai Chandan Lal held that if the claim repudiated in accordance with the policy conditions, same is not at all amount to deficiency in service on the part of the opposite party.

13.     It is to be noted that there is absolutely no evidence as to the cause of death of the life assured only because of HIV.  The 1^st and 2^nd decisions relied by the opposite party regarding the suppression of material facts and the answers given by the assured are incorrect is not evidenced by the opposite party by filing any documentary evidence.  Even though, the investigator made investigation and approached medical shops and doctors and neighbours, but he failed to file any one of the statements and also failed to submit medical treatment record of the life assured from the hospital.  Thus, the opposite party has not come up with any medical evidence to support its contentions, except relying upon the investigators’ report which was based on the oral statements of Villagers. 

14.     The other plea of the opposite party regarding the death within four month after taking policy, Exhibits 2 & 3 clearly shows that the life assured joined in hospital and took treatment for his fever and jaundice and the syrup and the injunction given by the doctor as per Ex.A3, the Forum came to know that the life assured suffered from jaundice and took treatment.  In Ex.A3 doctor prescribed some test i.e., Bilirubin which is for diagnose of jaundice and in our view because of sever jaundice only the life assured died and there was no pre existing decease to life assured.

15.     Assuming that the deceased died with HIV, there is absolutely no evidence to show that the death was due to HIV.  The 3^rd decision relied by the opposite party is regarding the medi-claim policy and the facts are different, there in that case, the complainant is a chronic renal diabetic and was on regular haemodialysis.  Here in this case, the life assured is aged about 36 years at the time of taking policy and that too the opposite party is not evidenced by any medical report or documentary evidence regarding their pleas.  It is to be noted that a duty is cast upon the insurance company         suppression of pre-existing decease not only to prove that contention, but also establish that the ultimate death was due to that pre-existing decease.  Thus, the nexus between the alleged pre-existing decease and the cause of death could not established by the opposite party.  Such being the case, the opposite parties are bound to pay policy amount of Rs.4,00,000/- and there is no justification for repudiation of the entire claim amount of the complainant.  Thus, the deficiency in service on the part of the opposite parties in rejecting the claim of the death of life assured during the policy period, has been clearly established, hence, the opposite parties are directed to pay the amount to the complainant being a wife and nominee of the deceased policy holder.  The opposite parties are also liable to pay interest at 9% on the policy amount from 06.03.2012 when the acknowledgment issued by the investigator regarding the receipt of necessary documents.

11.     In view of the unjust refusal to pay the policy amount by the opposite party there cannot be any dispute that the complainant shall be put to mental agony and suffering and in order to compensate it, it would be just and proper that the opposite parties are directed to pay Rs.15,000/- towards compensation to the complainant.

          Accordingly, this point is answered holding that both the opposite parties are directed to pay Rs.4,00,000/- with 9% p.a. from 06.03.2012 till the date of payment and another Rs.15,000/- towards compensation besides costs.

12.     In the result, the complaint is allowed directing the opposite parties 1 and 2 to pay Rs.4,00,000/- with 9% interest from 06.03.2012 till the date of payment to the complainant and also pay another sum of Rs.15,000/- towards compensation besides costs of Rs.2,000/- within two months from the date of this order. 

Dictated to the Shorthand Writer, transcribed by her, corrected and pronounced by us in the open Forum on this the 30^th day of June, 2014.

   Sd/-                                                                                 Sd/-

Member                                                                          President (FAC)

                                                                             District Consumer Forum-I

                                                                                       Visakhapatnam

APPENDIX OF EVIDENCE

Exhibits Marked for the Complainants:

Exhibits Marked for the Opposite Parties:

NIL

    Sd/-                                                                                 Sd/-

  Member                                                                         President (FAC)

                                                                             District Consumer Forum-I

                                                                                       Visakhapatnam