State Consumer Disputes Redressal Commission
Mohd. Farukh Javed vs L.I.C. Of India & Ors. on 3 August, 2016
CHHATTISGARH STATE
CONSUMER DISPUTES REDRESSAL COMMISSION,
PANDRI, RAIPUR(C.G.)
Appeal No.FA/2015/517
Instituted on : 27/11/2015
Mohd. Farukh Javed, S/o Raseed Ahmad,
Aged 44 years, R/o : Fataka Shop, Station Road,
Champa, District Janjgir - Champa (C.G.) ... Appellant.
Vs.
1. The Zonal Manager,
Life Insurance Corporation of India,
Central Zonal Office : Jeevan Shikha, 60-B,
Hoshangabad Road,
Bhopal (Madhya Pradesh)
2. Senior Divisional Manager,
Divisional Office Bilaspur,
District Bilaspur (C.G.)
3. Branch Manager,
Life Insurance Corporation of India,
Branch Office : Naila,
District - Janjgir - Champa (C.G.) ... Respondents
PRESENT: -
HON'BLE SHRI JUSTICE R.S. SHARMA, PRESIDENT
HON'BLE MISS HEENA THAKKAR, MEMBER
HON'BLE SHRI D.K. PODDAR, MEMBER
HO'N'BLE SHRI NARENDRA GUPTA, MEMBER.
COUNSEL FOR THE PARTIES: -
Shri Ashwani Gupta, for the appellant.
Shri D. Dutta and Shri G.V.K. Rao, for the respondents.
ORDER
Dated : 03/08/2016 PER :- HON'BLE SHRI JUSTICE R.S. SHARMA, PRESIDENT. This appeal is directed against the order dated 24.08.2015, passed by District Consumer Disputes Redressal Forum, Janjgir (C.G.) //2 // (henceforth "District Forum"), in Complaint Case No.CC/50/2014. By the impugned order, the complaint of the appellant (complainant), has been dismissed.
2. Briefly stated, the facts of the complaint of the complainant are that a policy in the name of mother of the complainant, Late Smt. Akhtari Begum, was obtained from O.P. No.2. The insurance policy No.385624144 was issued on 03.10.2009 for sum assured Rs..5,00,000/-. A sum of Rs.6,125/- was paid to the Insurance Corporation towards quarterly premium. Prior to issuance of the insurance policy, the life assured Smt. Akhtari Begum, was examined by the authorised doctor of the Insurance Corporation and at that time she was found completely healthy. Thereafter the Insurance Corporation issued insurance policy in the favour of the mother of the complainant. The mother of the complainant was fully healthy on the date of insurance policy i.e. 03.10.2009. The mother of the complainant was suffering from vomiting and when her condition was deteriorated, she was admitted in Apollo Hospital, Bilaspur on 13.08.2012 and during treatment she died on 16.08.2012 due to heart attack. Prior to obtaining insurance policy, the mother of the complainant was not suffering from any disease and did not admit in the hospital. The complainant and her mother did not suppress any fact or disease at the time of obtaining insurance policy. The complainant was suffering from diabetes and blood pressure prior to some days of her death. The Insurance Corporation repudiated the claim of the complainant holding that the mother of the complainant //3 // Smt. Akhtari Begum was suffering from diabetes and hypertension prior to 10 years from taking insurance policy, thus the Insurance Corporation committed deficiency in service. After repudiation of claim, the complainant submitted an application before Insurance Ombudsman Office, Bhopal (M.P. & C.G.). The Insurance Ombudsman office has not considered the claim of the complainant sympathetically and dismissed on the basis of false facts on 15.09.2014, which is contrary to law and facts. Hence the complainant filed consumer complaint before the District Forum and prayed for granting reliefs as mentioned in the relief clause of the complaint.
3. The OPs filed their written statement and averred that the physical examination of the insured person is conducted by the authorised doctor of the Insurance Corporation. The Insurance Corporation believes on the proposal form filled up by the life assured at the time of obtaining insurance policy and the answers of the questions asked were given by the life assured in the proposal form. On the basis of information given by the life assured in the proposal form, the insurance policy was issued. The O.P.No.3 did not issue the insurance policy in the name of the life assured after finding her fully healthy. The life assured Smt. Akhtari Begum died on 16.08.2012 at Apollo Hospital, Bilaspur during treatment. As per medical report of the Apollo Hospital Smt. Akhtari Begum was suffering from type 2 DM HTN since 10 last years prior to her death. The above facts have been suppressed in the proposal form at the time of obtaining insurance policy. According to //4 // report of Apollo Hospital, Bilaspur the life assured Smt. Akhtari Begumwas suffering from Type 2 diabetes, Hypertension since last 10 years. The claim of the complainant was not repudiated on the false facts but the doctor of the Apollo Hospital has mentioned in the medical report which was provided by the doctors to the OPs that Akhtari Begum was suffering from type 2 diabetes and hypertension since last 10 years. The above fact has not been disclosed by the life assured at the time of obtaining policy, otherwise the insurance cover would not be issued. The complaint is liable to be dismissed.
4. The complainant has filed documents. The documents are award dated 15.09.2014 passed by Insurance Ombudsman (M.P. & C.G.), Bhopal, letter dated 20.05.2014 sent by Assistant/Deputy Secretary, Office of the Insurance Ombudsman (M.P. & C.G.), Bhopal to the complainant, letter dated 26.07.2013 sent by Deputy Secretary / Secretary, Office of the Insurance Ombudsman (M.P. & C.G.), Bhopal to the complainant, letter dated 07.02.2014 sent by the complainant to Insurance Ombudsman (M.P. & C.G.), Bhopal, letter sent by the complainant to Insurance Ombudsman, Bhopal (M.P.), complaint made by the complainant against the Insurance Corporation, letter dated 25.01.2013 sent by Senior Divisional Manager, Divisional Office, Bilaspur to the complainant, letter dated 15.09.2013 sent by the complainant to the Regional Manager, (Regional Claim Review Committee), L.I.C. Regional Office, Bhopal (M.P.), letter dated 18.06.2013 sent by Regional Manager, (Regional Claim Review Committee), L.I.C. //5 // Regional Office, Bhopal (M.P.), death certificate of Smt. Akhtari Begum issued by Registrar (Birth & Death).
5. The OPs have also filed documents. The documents are proposal form, Accident and emergency record of Apollo Hospitals, Bilaspur (C.G.), Discharge Summary issued by Apollo Hospitals, Bilaspur, Certificate of Hospital Treatment, Form to obtain medical opinion from DMR for claim cases and proposal form.
6. Learned District Forum after having considered the material placed before it by the parties has dismissed the complaint of the appellant (complainant).
7. Shri Ashwani Gupta, learned counsel appearing for the appellant (complainant) has argued that the life assured Smt. Akhtari Begum has not suppressed any material fact. The respondents (OPs) did not succeed to prove that life assured Smt. Akhtari Begum was suffering from any disease which exclude her for getting compensation from the respondents (OPs) under the insurance policy, therefore, the appellant (complainant) is entitled to get compensation from the respondents (OPs). The respondents (OPs) have wrongly repudiated the claim of the appellant (complainant). The impugned order passed by the District Forum, is erroneous and the same is liable to be set aside. He placed reliance on Life Insurance Corporation of India and Others Vs. Smt. Kala Bai Parmar, 2005 (3) M.P.H.T. 1 (CPC), Harbans Singh Sohal Vs. Divisional Manager, The Oriental Insurance Co. Ltd., Indore, 2005 (3) //6 // M.P.H.T. 18 (CPC), LIC Of India Vs. Smt. Manju Parwani, 2006 (1) C.G.L.J. 26, Life Insurance Corporation of India Ltd. and Others Vs. Smt. Belmati Heera, 2005 (2) M.P.H.T. 6 (CPC), Branch Manager, Life Insurance Corporation of India Vs. Smt. Gautam Bai and Another 2005 (2) M.P.H.T. 29 (CPC), S.B.I. Life Insurance Company Ltd. Vs. Smt. Sheela Yadav and another, 2008 (5) M.P.H.T. 12 (CPC), Life Insurance Corporation of India Ltd. Vs. Rukmani Bai (Smt.) 2010 (1) M.P.H.T. 23 (CPC) and Life Insurance Corporation of India Vs. Smt. Manju Parwani 2006 (1) M.P.H.T. 34 (CPC).
8. Shri D. Dutta, learned counsel appearing for the respondents (OPs) has argued that the impugned order passed by the District Forum, is just and proper and does not suffer from any infirmity or illegality. The deceased life assured Smt. Akhtari Begum was suffering from Type 2 DM HTN prior to taking insurance policy. The life assured suppressed material facts at the time of obtaining insurance policy, therefore, the respondents (OPs) have jurisdiction to deny the claim of the appellant (complainant) and the impugned order passed by the District Forum is just and proper and does not call for any interference by this Commission.
9. We have heard learned counsel for the parties and have also gone through the record of the District Forum and have also perused the impugned order passed by the District Forum.
//7 //
10. The appellant (complainant) pleaded that his mother life assured Smt. Akhtari Begum had obtained insurance policy No.385624144 from the respondent No.2 (O.P.No.2) for sum assured Rs.5,00,000/-. A sum of Rs.6,125/- was paid to the Insurance Corporation towards quarterly premium. Prior to issuance of insurance policy, the life assured Smt. Akhtari Begum, was examined by the authorized doctor of the Insurance Corporation and at that time she was found completely healthy. Thereafter the Insurance Corporation issued insurance policy in the favour of life assured Smt. Akhtari Begum. The appellant (complainant) further pleaded that on 03.10.2009 when the insurance policy was obtained by the life assured Smt. Akhtari Begum was completely healthy and all of a sudden on 13.08.2012, she fell ill and was suffering from vomiting and when her condition was deteriorated, she was admitted in Apollo Hospital, Bilaspur and during treatment she died on 16.08.2012 due to heart attack. Prior to obtaining insurance policy, the mother of the appellant (complainant) Smt. Akhtari Begum was not suffering from any disease.
11. On the contrary, the respondents (OPs) pleaded that the Insurance Corporation believes on the proposal form filled up by the life assured at the time of obtaining insurance policy and the answers of the questions asked were given by the life assured in the proposal form. On the basis of information given by the life assured in the proposal form, the insurance policy was issued. The Life Assured Smt. Akhtari Begum died on 16.08.2012 at Apollo Hospital, Bilaspur and as per medical report of //8 // Apollo Hospital, the life assured Smt. Akhtari Begum was suffering from Type 2 DM HTN since last 10 years. The above facts have been suppressed by the life assured at the time of obtaining insurance policy from the Insurance Corporation.
12. The appellant (complainant) filed copy of complaint filed by her before The Insurance Ombudsman, Bhopal and award passed by the Insurance Ombudsman. The Insurance Ombudsman vide order dated 15.09.2015 held that the decision taken by the respondent to repudiate the death claim on the ground of giving false statement and concealment of material facts about ailment of diabetes and HTN at the time of taking the said policy is perfectly justified on the basis of aforesaid hospital record and is sustainable in law and complainant is not entitled to get the death claim. In the result, the complaint stands dismissed accordingly being devoid of any merit.
13. The respondents (OPs) filed Medical Record of Apollo Hospitals, Bilaspur. In Accident and Emergency Record Routine, it is mentioned that the life assured Smt. Akhtari Begum was admitted at Emergency on 13.08.2012 and time of assessment is 9.30 P.M. Under the head Clinical Information Chief Complaints, it is mentioned that she was suffering from HTN, DM since 10 years. In Discharge Summary, it is specifically mentioned that the life assured was having history of Type II DM since last 10 years and is a known case of Type II DM, HTN admitted with above mentioned complaints. ECG showed ST elevation II, III, aVF, ST //9 // depression V1-V3. Echo showed LV dysfunction, mild MR. CAG showed triple vessels disease.
14. The respondents (OPs) have filed medical opinion obtained from DMR. Dr. Avijit Royzada, has also given his opinion thus :-
"Disease not disclosed.
Type two Diabetes (+) Hypertension since last 10 years and he has not disclosed the disease to the LIC. If LA disclosed the Disease LIC would have refused the proposal or investigated according to the disease."
15. It appears that the life assured Smt. Akhtari Begum was suffering from Type 2 Diabetes Hypertension since last 10 years prior to obtaining insurance policy.
16. In Revision Petition No.2877 of 2013 - M/s. Aviva Life Insurance Company India Pvt. Ltd. vs. Smt. Phool Kunwar, vide order dated 04.08.2015, Hon'ble National Commission, has observed thus :-
"15. As apparent from the record of Apollo Hospital, the deceased was suffering from diabetes mellitus and hypertension for last two years prior to his death. So, it stands clearly proved that deceased life assured had concealed and suppressed material facts at the time of obtaining the insurance policy.
16. In this regard, observations made by Hon'ble Supreme Court in "Satwant Kaur Sandhu Vs. New India Assurance Company Ltd. (2009) 8 SCC 316" which are quite relevant to the present case, are quoted as under :-
"Thus, when an information on a specific aspect is asked for in the proposal form, an assured is under a solemn obligation to make a true and full disclosure of the information on the subject which is within his knowledge. It is not for the proposer to determine whether the information sought for is material for the purpose of //10 // the policy or not. Of course, obligation to disclose extends only to facts which are known to the applicant and not to what he ought to have known. The obligation to disclose necessarily depends upon the knowledge one possesses. His opinion of the materiality of that knowledge is of no moment."
In para 29 of Satwant Kaur Sandhu's case (Supra), the Hon'ble Apex Court has held that :
"29. Judged from any angle, we have no hesitation in coming to the conclusion that the statement made by the insured in the proposal form as to the state of his health was probably untrue to his knowledge. There was clear suppression of material facts in regard to the health of the insured and, therefore, the respondent - insurer was fully justified in repudiating the insurance contract. We do not find any substance in the contention of learned counsel for the appellant that reliance could not be placed on the certificate obtained by the respondent from the hospital, where the insured was treated.
17. This Commission in Life Insurance Corporation of India Vs. Smt. Minu Kalita, R.P. No.1167 of 1997 decided on 19.03.2012" has held that :-
"It is settled law that the contract of insurance is based on good faith. The information as to the insured having suffered from Cancer before the policy was taken and the hospitalization for the same came to light afterwards and the petitioner is not to know this by an examination of their medical officer. It is for the respondent to give the correct information on his health which he did not disclose at that time. This ground of incorrect information and false statements regarding age of the insured and income make the insurance contract null and void. We find there is no deficiency of service by the petitioner Life Insurance Corporation of India. Both the District Forum and the State Commission have not appreciated the facts brought out by the petitioner in repudiating the claim."
17. In Gurmeet Kaur @ Meeto & Anr. vs. Life Insurance Corporation of India, III (2015) CPJ 246 (NC), Hon'ble National Commission has observed that "Deceased had been suffering from diabetes for the last 14-15 years and suffered from chronic renal failure for last 4-5 years. No evidence on //11 // record to prove that information given by Doctor regarding health status of insured was incorrect. Violation of conditions of policy established. Repudiation justified."
18. In Life Insurance Corporation of India v. Shahida Khatoon & Anr., IV (2013) CPJ 370 (NC), Hon'ble National Commission observed thus :-
"12. We have relied upon several judgments of Hon'ble Supreme Court in cases Satwant Kaur Sandhu v. New India Assurance Co. Ltd., IV (2009) CPJ 8 (SC) = VI (2009) SLT 338 = (2009) 8 SCC 316, P.C. Chacko and Anr. v. Chairman, LIC of India, III (2008) CPJ 78 (SC) = IX (2007) SLT 533 = IV (2007) ACC 773 (SC) = (2008) 1 SCC 321, LIC of India v. Smt. Asha Goel, I (2001) SLT 89 = (2001) 2 SCC 160, have discussed the term "Material Fact" as fact which goes to the root of the contract of insurance and has a bearing on the risk involved would be material. The term material fact is not defined in the Act and, therefore, it has been understood and explained in general terms to mean as any fact which influence the judgment of a prudent insurer in fixing the premium or determine whether he would like to accept the risk.
13. Therefore, we do not find any force in the arguments of Counsel for complainant/respondent. Both the Fora below have erred in not considering the non-disclosure of material facts by the deceased and filled the proposal form. Accordingly, we set aside the orders passed by Fora below and allow this revision petition by dismissing the complaint. No order as to cost".
19. In L.I.C. of India v. Pratima Mishra, IV (2013) CPJ 161 (Chha.), this Commission observed thus :-
"8. Even if we presume that the deceased was required to notify anything to the Insurance Corporation as per terms and conditions of the acceptance, as per printed material available in the bottom of receipt of deposit of premium, even then requirement was only this that if there is //12 // any change in the occupation of the insured, then it was required to be notified and if there is any adverse circumstances connected with financial position or the general health of the proposer or that of any members of his family then if that circumstance may be very much unimportant, but the same if occurred between the date of proposal and date of this receipt or if on a proposal for assurance or an application for revival of a policy on the life made to any office of the Corporation, then it was required to be notified. Thus, what was required to be notified was any change in the occupation of the insured or any adverse circumstances affecting the insured or his family members. If deceased insured suffered a road accident, but immediately after treatment it was found that he was not having any bony injury. When no adverse circumstances relating to his health was stated by any of the doctors to the deceased insured, then it was not required for him to notify anything to the Insurance Corporation. Even in the receipt, which was obtained by the deceased after deposit of the premium, only such terms and conditions were printed.
9. Documents in respect of treatment of deceased insured, which have been brought on record by the appellant before the District Forum are photocopies of the treatment of the deceased insured in Ramkrishna Care Hospital, Raipur as well as Chandulal Chandrakar Memorial Hospital, Bhilai. From these documents, it appears that as per noting of Ramkrishna Care Hospital, Raiapur on C.T. Scan, it was found that there was no bony injury and all four limbs could be raised by him. Pupil of both eyes were normal. Thus, nothing substantial was noted by the Hospital for which it can be said that it was a circumstance which had adversely affected the health of the insured and was required to be notified by him to the Insurance Corporation. Later on he was treated with Chandulal Chandrakar Memorial Hospital, Bhilai from 15.03.2008, where ultimately he died on 16.03.2008. Thus, from record of the treatment given in Ramkrishna Care Hospital, it appears that it is not containing any such information which can be said to be relating to //13 // circumstance adversely affected the health of the deceased insured and was required to be notified by him to the Insurance Corporation."
20. In L.I.C. of India v. MU Jakia, IV (2013) CPJ 129 (NC), Hon'ble National Commission observed thus :-
"15. It is an undisputed fact that Shri Akhil Khan the deceased had taken LIC policy from the respondent for a sum of Rs.51,000/- on 1.1.2004. It is also an admitted fact that as per the bed head ticket of Maharana Bhopal Hospital, Udaipur the deceased was admitted to the hospital on 3.6.2003 for the treatment of chronic renal failure, hypertension, septicaemia, nephritis and was discharged from the hospital on 6.6.2003. While the State Commission has correctly come to the conclusion that the petitioner were justified in repudiating the claim of the respondents on the ground of suppression of material fact regarding health and that the finding of the District Forum rejecting the claim of the respondents were based on correct appreciation of entire material evidence available on record and they do not suffer from any basic infirmity or illegality or perversity and hence, no interference is called for with the same and appeal was dismissed. The State Commission erroneously went on to award an ex gratia payment on humanitarian consideration of Rs.15,000/-. This is beyond the pleadings of the respondents. Further, in P.C. Chacko and Anr. v. Chairman Life Insurance Corportion of India and Ors., IV (2007) ACC 773 (SC) = IV (2007) CLT 229 (SC) = IX (2007) SLT 533 = III (2008) CPJ 78 (SC) = 2007 XAD (SC) 429, in which paragraph 20 which is relevant to us in this case reads as under :
"We are not unmindful of the fact that Life Insurance Corporation being a state within the meaning of Article 12 of the Constitution of India, its action must be fair, just and equitable but the same would not mean that it shall be asked to make a charity of public money, although the contract of insurance is found to be vitiated by reasons of an act of the insured. This is not a case where the contract of insurance or a clause thereof is //14 // unreasonable, unfair or irrational which could make the Court carried the bargaining powers of the contracting parties. It is also not the case of the appellants that in framing the aforesaid questionnaire in the application/proposal form, the respondents had acted unjustifiably or the conditions imposed are unconstitutional."[See also Life Insurance Corporation of India & Anr. v. Vinod Devi, IV (2013) CPJ 142 (NC)].
16. The National Commission in RP Nos. 858, 894, 995, 1435, 1446, 1503, 1504, 1505, 1553, 1554, 1679, 1680, 1722, 1723, 3631 of 2009, 1504 of 2006, 3147, 3789, 3855, 3858 to 3860, 3917, 3918, 4662, 4663, 4726, 4727, 4836, 4837, 5009, 5010, 5030 of 2008, 23, 164, 331, 359, 1909, 1926, 2945, 2946, 3094, 3097 of 2009 decided on 17.12.2009 have stated as under :-
"We are afraid in terms of provisions of Consumer Protection Act 1986, we are not free to do a 'favour' to a party. As, far as the moral obligation is concerned, that has to be done 'voluntarily' by the authority concerned. The Consumer Fora cannot pass or give direction or order to give a 'favour' otherwise the word more grounds are voluntarily will lose its very meaning. While going through the aim and objectives of the Consumer Protection Act, 1986, as highlighted by the learned Counsel for the respondent we are of the view that a distinction needs to be made between justice - natural or otherwise and 'favour'. There is no room for favouritism while dispensing justice. The word ' ex gratia' has been interpreted / understood to mean favour', rendered 'voluntarily' and on 'moral grounds', thus, clearly ousting the jurisdiction of quasi-judicial bodies like ours to direct a party to show favour. If we do this, this will not only run counter to the letter and spirit of Consumer Protection Act but also assume / confer powers which are not conferred upon us by Law / mandate. Any direction by Consumer Fora to the party concerned to grant ex gratia payment will defeat the very purpose //15 // and meaning of 'ex gratia', i.e., favour, grace shown voluntarily on moral grounds.
However, this order would not deter directing payment of ex gratia' basis by the Consumer Forums, provided, the concurrence of the sanctioning authority of insurance company, is obtained through their Counsel (Counsel for the Insurance Company) for making the payment on 'ex gratia' basis."
21. It is settled principle of law that the contract of insurance is a contract uberrima fides and there must be complete good faith on the part of the life assured at the time of submitting proposal form for obtaining the policy and the assured is under a solemn obligation to make full disclosure of material facts with regard to his state of health because the same was relevant for the insurer to decide as to whether the Insurance Policy is to be issued to the proposer or not.
22. In the instant case, the deceased life assured Smt. Akhtari Begum obtained insurance policy No.38562411 for sum assured Rs.5,00,000/- from the respondent No.2 (O.P.No.2) on 03.10.2009. According to the respondents (OPs), the life assured Smt. Akhtari Begum submitted proposal form for insurance on her life but in the proposal form she did not disclose the fact that she is suffering from Type 2 DM HTN disease.
23. The respondents (OPs) have filed Certificate of Hospital Treatment. In Clause 10 thereof, questions were asked regarding treatment taken by the life assured. A question was asked from her that was he / she treated in the hospital on any previous occasion either as an //16 // in-patient or an out-patient, in reply to which the life assured had given answer in negative form i.e. "No".
24. From bare perusal of treatment papers and the medical report filed by the respondents (OPs) in respect of life assured Smt. Akhtari Begum, it appears that she was suffering from Type 2 DM HTN since last ten years prior to obtaining insurance policy, but she did not disclose these facts while making proposal statement and has violated the terms and conditions of the insurance policy, therefore, the appellant (complainant), who is son of the life assured, is not entitled for insurable benefit under the insurance policy.
25. On the basis of above discussions, it appears that the finding recorded by the District Forum, is reasonable and does not suffer from any infirmity or illegality and does not call for any interference by this Commission.
26. Therefore, the appeal filed by the appellant (complainant) being devoid of any merits, deserves to be and is hereby dismissed. No order as to the cost of this appeal.
(Justice R.S. Sharma) (Ms. Heena Thakkar) (D.K. Poddar) (Narendra Gupta)
President Member Member Member
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