BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM RAICHUR.
COMPLAINT NO. (DCFR) CC. 33/2012.
THIS THE 2nd DAY OF NOVEMBER 2012.
P R E S E N T
1. Sri. Pampapathi B.sc.B.Lib. LLB PRESIDENT.
2. Sri. K.H. Sri Ramappa, B.A.LLB. MEMBER.
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COMPLAINANT :- Sri. Honnappagouda S/o. Adiveppagouda
Tatagani, Age: 50 years, Occ; Agriculture, R/o. Belohad Tq. & Dist: Gadag.
//VERSUS//
OPPOSITE PARTY :- The Sr. Divisional Manager, LIC of India,
Divisional Office, Raichur, Dist: Raichur.
CLAIM : For seeking direction to pay sum assured of Rs.
1,50,000/- bearing policy No. 663993752 attributing deficiency in service on the part of the opposite in repudiating his claim.
Date of institution :- 23-04-12.
Notice served :- 14-05-12.
Date of disposal :- 02-11-12.
Complainant represented by Sri. T.M. Swamy, Advocate.
Opposite represented by Sri. Basavaraj Sakri, Advocate.
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This case coming for final disposal before us, the Forum on considering the entire material and evidence placed on record by the parties passed the following.
JUDGEMENT
By Sri. K.H. Sri Ramappa, Member:-
This is a complaint filed by complainant U/sec. 12 of Consumer Protection Act against the opponent seeking direction to pay sum assured of Rs. 1,50,000/- bearing policy No. 663993752 attributing deficiency in service on the part of the opponent in repudiating his claim.
2. The brief facts of the case briefly sated as under:
One Venkanna @ Yenkanna during his life time had obtained policy bearing No. 663993752 for assured sum of Rs. 1,50,000/- including other three policies bearing Nos. 663602647, 664225199 and 664078162 from the opponent and the complainant is the nominee of the policy bearing No. 663993752 and the policyholder was hale and healthy prior to obtain policy from the opponent, he was educated and agriculturist by profession at the time of the obtain the policy, subsequently he got job as a clerk in private Bank and all the policies obtained through the agent of the opponent. Further case of the complainant that, the life assured has died on 05-06-2008 during to Heart Attack suddenly and death was intimated to the opposite along with required documents for process of claim, but the opponent has repudiated the claim in routine manner on flimsy grounds stating that, the policyholder was suppressed having obtained other policies as it has been intimated to the opponent authority prior to issue the above policy. The complainant further contended that, the opponent has paid death benefits of the other three policies. The repudiation of the policy No. 663993752 on the false ground is not sustainable under law, because the policyholder had brought to the knowledge of the other policies to the concerned agent before obtained the policy and the opponent had got the knowledge of the previous policies as the entries of the policies are available in the policy’s ledgers of the opponent and computers automatically shown the details of previous or existing polices and the ground of repudiation for the benefits of the policy has not direct nexus with incident of the policyholder. Hence the denial of the death benefits to the complainant and repudiation made on flimsy grounds amounts to deficiency in service and unfair trade practice on the part of the opponent. On these grounds complainant prays for allowing the complaint with a direction to opponent to pay sum assured and benefits of the policy with interest and also claimed cost of the litigation.
3. Opponent has appeared though its counsel and filed written version by resisting the claim of the complainant and opponent has admitted that, the life assured Venkanna has obtained the policy No. 663993752 sum assured of Rs. 1,50,000/- at Koppal Branch office on 14-08-2007 and admitted his avocation and the complainant is the nominee of the said policy and the death of the life assured is also admitted, but the opponent has denied that, the life assured was hale and healthy prior to obtain the policy. Further opponent specifically contended that, the life assured had not disclosed details of the previous policies Nos. 664230211, 663602647, 664231779 and 664225199 sum assured of Rs. 1,00,000/-, 50,000/-, 50,000/-, and 1,00,000/- on 31-08-2007, 28-03-2006, 05-11-2007, and 15-05-2007 respectively which were obtained by the life assured at LIC of India Raichur Branch and another policy No. 664078162 for Rs. 50,000/- obtained from the Sindhanoor Branch in the proposal and suppressed holding of the previous policies by the life assured, so the total insurance assured on the life will attract on medical and special reports as per Life Insurance of India Rules and the opponent could have called for ECG, Heamogram and Elisa for HIV reports etc., and which would have disclosed his illness. Opponent further contended that, the life assured had purposely suppressed this material information and not disclosed the same in question No-3 of the proposal form which required details of the previous policies and insurance is a contract between the insurer and the insured in utmost good faith and suppression of any material information at the time of submission of the claim by the proposal would justify the repudiation of the claim by the insurer as per settled law, and there was no negligence or deficiency in service attributed on the part of the opponent. On these grounds opponent prays for dismissal of the complaint with cost.
4. The complainant has filed his affidavit-evidence of PW-1, and documents marked as Ex.P-1 to Ex.P-6 and closed his side. As against this, the Manager of the Opponent by name S.H. Morappanavar has filed affidavit-evidence as RW-1 and documents marked as Ex.R-1 & Ex.R-2 and closed its side. Both parties have filed written arguments and also advanced the oral argument.
5. Now, on the basis of the facts the following points would arise for our consideration:
1. Whether the complainant has proved that, there is deficiency in service on the part of the opponent in repudiating his claim. If so, whether complainant is entitled for the reliefs as prayed in his complaint.?
2. What order?
6. Our findings on the above points are as under:-
(1) In partly affirmative.
(2) As discussed in the body of this judgement and as noted in the final order.
REASONS
7. We have carefully gone through the pleading, evidence and documents, and material on records. We have heard the arguments and perused the decisions relied by the counsels appeared for the parties. It is undisputed fact that, one Venkanna had obtained policy bearing No. 663993752 for assured sum of Rs. 1,50,000/- on 14-08-2007 and the complainant is the nominee of the said policy and the life assured died on 05-06-2008. But the opponent repudiated the claim on the ground that, the deceased life assured having with held correct information regarding previous three Insurance Policies viz., 663602647, 664225199 and 664078162 obtained by the life assured at the time of the effecting the assurance with the opponent and opponent is not liable for any payment under the above policy. It is specific contention of the opponent that, the life assured obtained the policy bearing No. 663993752 suppressing material information and did not disclose holding of the previous policies in question No-3 of the proposal form which requires details of the previous policies and insurance is a contract between the insurer and insured in utmost good faith and suppression of any material information at the time of the submission of the proposal would justify the repudiation of the claim by the insurer as per settle law and no deficiency in service on the part of the opponent. In order to substantiate these contentions the opponent has placed on record except Ex.R-1 & Ex.R-2. The complainant has produced only Status Report of the policy bearing No. 663993752 which marked under Ex.P-1 and established that, the life assured paid the premium of Rs. 15,000/- on 13-08-2007 and policy commenced on 14-08-2007 on the yearly premium and the life assured died on 05-06-2008 but the opponent has repudiated the claim on the ground that, the insurance is a contract between the insurer and insured in utmost good faith and suppression of any material information at the time of submission of the claim by the proposal would justify the repudiation of the claim by the insurer and there was no deficiency in service on the part of the opponent. On the basis of these materials on record the key question is whether the insured was bound to disclose how much previous policies had with the insurer LIC, the main contention of the opponent is that, the deceased did not disclose the previous existing policies viz., 663602647, 664225199 and 664078162 at the time of obtaining the said policy on playing fraud upon the insurer for that, reason no amount was payable to the complainant and further contention of the opponent that, if the insured declared that, the previous policy obtained by him the insured deceased was to under go certain medical tests such as the special report of ECG, Haemogram and Elisa and the claim was also resisted on the same ground. We have perused the Ex.R-1 proposal form produced by the opponent with marked at Ex.R.1. it appears it is the format of the insurance proposal requires the proposal to give details of his previous insurance (including details of policies surrendered/lapsed during the last three years) in the table under question No-3 and it should not leave any doubt that, a proposer of insurance is obligated to furnish the details not only of the existing policy but also many other details and it would clearly shows that, the proposer has not disclosed any particulars regarding the existing policy. More particularly it is important to note that, the insured had taken five policies in quick succession between 28-03-2006 to 05-11-2011 and the insured choose to take the policies from different branch offices of the LIC namely Raichur, Sindhanoor & Koppal and so that, the factual position about the pre-existing policies taken by the insured may not be verified by the Branch office concerned. In support of the submission of the counsel appeared for the opponent has relied the decision of the Hon’ble National Commission reported in: III (2012) CPJ 288 (NC) in which it has held that, the assured is under a solemn obligation to make true and full disclosure of information on the subject which is within his knowledge and no explanation for non disclosure of the fact that, utmost importance is forthcoming, the repudiation is justified. Further, he relied upon unreported case in Appeal No. 26/2005 dt. 27-01-2010 of the Hon’ble the National Commission and it has held that, if the insured had deliberately suppressed a material fact from the Insurance Company with ulterior motive and by doing so, he has played fraud on the LIC in obtaining of the subsequent policy and repudiation made by the opponent is justifiable and direct the LIC to refund the premium amount received by the insured in respect of the policy. These decisions are aptly applicable to the case on hand. On looking these facts of the case and prepositions laid down by the Hon’ble National Commission, we find that, the insured had deliberately suppressed this material facts holding the existing policies at the time of affecting the assurance of the said policy with ulterior motive and played fraud on the LIC in obtaining the subsequent policy and under these circumstances, in our view, the opponent was justified in repudiating the claim payable in respect of the said policy. However in the particular facts and circumstances of the case, it is just and proper to direct the LIC to refund the premium amount of Rs. 15,000/- received by it in respect of the policy bearing No. 663993752 dt. 14-08-2007 with interest at 9% p.a. from the date of the complaint and opponent is also liable to pay Rs.2,000/- towards cost of the proceedings.
ORDER
The complaint filed by the complainant is partly allowed with cost.
The opponent is directed to pay Rs. 15,000/- with interest 9% p.a. from the date of the complaint till its realization.
The opponent is also order to pay Rs. 2,000/- towards the cost of proceedings.
The opponent is granted to pay the above said sum within six weeks from the date of receipt of this order.
Intimate the parties accordingly.
(Dictated to the Stenographer, typed, corrected and then pronounced in the open Forum on 02-11-12)
Sri. K.H. Sri Ramappa Sri. Pampapathi,
Member. President,
District Consumer Forum Raichur. District Consumer Forum Raichur.
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