State Consumer Disputes Redressal Commission
Hdfc Standard Life Insurance Co.Ltd. vs Kiranjit Kaur & Ors. on 22 April, 2014
STATE CONSUMER DISPUTES REDRESSAL COMMISSION,
PUNJAB, DAKSHIN MARG, SECTOR-37A, CHANDIGARH
1st Additional Bench
FIRST APPEAL NO. 751 OF 2012
Date of Institution: 05.06.2012
Date of Decision: 22.04.2014
1. HDFC Standard Life Insurance Co.Ltd., Branch Address: HDF
SL Abohar Branch, Laxmi Complex, 2nd Floor, Street No.5,
Last Chowk, Abohar-152116, District Fazilka through Zonal
Legal Executive, Sh.Harsimran Singh.
2. HDFC Standard Life Insurance Co.Ltd., 3, Obroi Tower,
M.G.Marg, Gangtok Sikkim-737101 through its M.D.
.....Appellants/Opposite Parties
VERSUS
1. Kiranjit Kaur widow of Kulwinder Singh,
2. Navpreet Kaur daughter of Kiranjit Kaur widow of Kulwinder
Singh,
3. Jyoti Bhullar daughter of Kiranjit Kaur widow of Kulwinder
Singh,
4. Arashdeep aged 14 years son of Kiranjit Kaur widow of
Kulwinder Singh,
All are residents of Street No.11, House No.4159, Nai Abadi,
Abohar-152116, District Fazilka, Punjab.
.....Respondents/Complainants
First Appeal against the order
dated 16.4.2012 passed by the
District Consumer Disputes
Redressal Forum, Ferozepur.
Quorum:
Sh. Baldev Singh Sekhon, Presiding Member
Sh. Jasbir Singh Gill, Member Present:
For the appellants : Sh.Nitin Thatai, Advocate For the respondents : Sh.Rajesh Narang, Advocate BALDEV SINGH SEKHON, PRESIDING MEMBER This appeal has been filed by the appellants/opposite parties against the order dated 16.4.2012 passed by the District Consumer First Appeal No. 751 of 2012 Page 2 of 7 Disputes Redressal Forum, Ferozepur (in short "District Forum"), vide which the complaint filed by the respondents/complainants was allowed with a cost of Rs.2,500/- as litigation expenses and the opposite parties were directed to make payment of his claim to the tune of Rs.2,49,995/- after deducting the amount already paid to them. This order was to be complied within 30 days from the date of receipt of copy of the order, failing which they were also be liable for payment of interest @ 9% per annum on the amount of the claim from 11.1.2011 from the date of repudiation of the claim till actual payment.
2. The facts, as stated in the complaint, are that Kulwinder Singh, deceased, who was the husband of complainant No.1 and father of complainants No.2 to 4, purchased an insurance policy, bearing No.13694777 on 28.5.2010 for Rs.2,49,995/- on payment of Rs.49,999/- as premium. Said Kulwinder Singh died on 25.8.2010 due to jaundice/heart attack and intimation about the same was given to the opposite parties. The claim was also lodged with the opposite parties and discharge vouchers were also got signed from the complainants by the surveyor. But later on, the opposite parties sent a cheque dated 7.1.2011 for Rs.49,235.50 alongwith letter dated 11.1.2011 stating therein that his claim had been repudiated for the remaining amount as the life assured died within 90 days of the commencement of the coverage under the policy. Alleging exclusion clause to be illegal and the repudiation as deficiency in service, the complainants filed complaint before the District Forum seeking First Appeal No. 751 of 2012 Page 3 of 7 directions to the opposite parties to pay Rs.2,49,995/- alongwith interest @ 24% per annum. Costs and compensation were also prayed.
3. The opposite parties appeared and filed written reply admitting that proposal form was filled by the deceased life assured (in short "DLA") on 26.5.2010 and the policy, in question, was issued on 29.5.2010 whereas he died on 25.8.2010. As per condition/clause 3
(i) (b) of the policy, company was not liable to pay any benefit other than the value of the units held at the date of intimation of death if death occurred within 90 days of the date of commencement, date of issue or date or revival, whichever was later. Since the death of the DLA occurred within 90 days of the issuance of the policy, life insurance cover was not available. Accordingly, a cheque for the amount of Rs.49,235.50 paise as fund value on the date of intimation of death was sent to the complainants. Denying all other allegations, dismissal of the complaint was prayed.
4. The parties led their evidence by way of affidavits and documents and the District Forum, after going through the pleadings of the parties and evidence on record, allowed the complaint in aforesaid terms.
5. Aggrieved by this order, the opposite parties have come up in appeal on the ground that the District Forum did not appreciate the facts and circumstances of the case in the right perspective and it did not apply and interpret the law on the points involved correctly. The findings recorded by the District Forum are based on mere surmises First Appeal No. 751 of 2012 Page 4 of 7 and conjectures, wrong reasons and assumptions and thus were not tenable in the eyes of law. The District Forum has miserably failed to appreciate and consider the fact that the DLA submitted proposal form dated 26.5.2010 for the purchase of HDFC Young Star Champion Suvidha Policy which was accepted and consequently a policy bearing No.13694777 dated 29.5.2010, was issued that commenced on 28.5.2010. Before acceptance of the proposal by the opposite parties, the contents of the proposal application, illustrations and addendum forms were read over and explained to the DLA in the language best known to him. On the basis of the information furnished in the application proposal form, the proposal was accepted by the opposite parties and thereafter the said policy was issued to him. It was further submitted that the DLA was given the detailed description about the features of the said plan including the premium amount to be paid, all the charges that would be levied on the same and was also apprised with its terms and conditions before signing of the said application. The DLA signed the said application form and the declaration on his free will and consent in which it was declared by him as under:
"I/We understand, agree and declare that:-
I/We have read and understood the products as described in the sales literature and the sales illustration. Xxx Irrespective of me filling this form or not, I declare and agree that, my signature affixed below stand proof of me being bound First Appeal No. 751 of 2012 Page 5 of 7 by the contents of this form and the information provided herein."
6. It was further submitted that the District Forum has failed to appreciate and consider the fact that the DLA opted for the policy in which there was a stipulation under clause 3 (i) (b) that the opposite parties will not pay any benefit other than the value of the units held at the date of intimation of death if the death occurs within 90 days of the date of commencement, date of issue or date of revival.
7. We have thoroughly gone through the pleadings of the parties and have carefully perused the evidence on record.
8. Admittedly, the DLA obtained an HDFC SL Young Star Champion Suvidha Policy (Ex.C-2) from the opposite parties for a term of 10 years with annual premium of Rs.49,999/-. A perusal of this document clearly shows that the date of commencement of the policy was 28.5.2010 and the DLA died on 25.8.2010. It is evident that the DLA died on the 90th day of issuance of the policy i.e. after completion of a period of 89 days. The death claim filed by the complainants was repudiated by the opposite parties on 11.1.2011, vide Ex.R-4 stating therein that the DLA had died within 90 days of the commencement of the coverage under the policy hence they were unable to process the claim any further. However, the opposite parties issued a cheque No.786819 dated 7.1.2011 for Rs.49,235.50 towards value of units held. The opposite parties have proved on record the terms and conditions of the policy as Ex.R-3 and its relevant portion is reproduced as under:-
First Appeal No. 751 of 2012 Page 6 of 7
"3. (i) (b) Death Benefit:- XXX We will not pay any benefit other than the value of units held at the date of intimation of death if death occurs within 90 days of the date of commencement, date of issue or date of revival whichever is later."
9. No doubt, this is a marginal case where the life of the DLA fell short by just one day. The District Forum has wrongly relied upon the Section 28 of the Contract Act, 1872 to interpret the terms and conditions of the policy agreed to by the parties. The Hon'ble Supreme Court in case "M/s Suraj Mal Ram Niwas Oil Mills (P.) Ltd. Vs. United India Insurance Co.Ltd. & anr." reported as 2010 (95) AIC 28, has clearly set the law and was pleased to hold as under:-
"Thus, it needs little emphasis that in construing the terms of a contract of issuance, the words used therein must be given paramount importance, and it is not open for the Court to add, delete or substitute any words. It is also well settled that since upon issuance of an insurance policy, the insurer undertakes to indemnify the loss suffered by the insured on account of risks covered by the policy, its terms have to be strictly construed to determine the extent of liability of the insurer. Therefore, the endeavour of the court should always be to interpret the words in which the contract is expressed by the parties."
10. In view of the above findings and the law set by the Hon'ble Supreme Court, the appeal of the appellants/opposite parties is First Appeal No. 751 of 2012 Page 7 of 7 accepted and the impugned order of the District Forum is set aside. Consequently, the complaint filed by the respondents/complainants is dismissed. No order as to costs.
11. The appellant deposited a sum of Rs.25,000/- with this Commission at the time of filing of the appeal and another sum of Rs.50,000/- on 16.8.2012 as per direction given by this Commission. The entire amount, alongwith interest, which has accrued thereon, if any, be remitted by the Registry to appellant No.1, by way of a crossed cheque/demand draft, after expiry of 45 days under intimation to the learned District Forum.
12. The arguments in the case were heard on 17.4.2014 and the order was reserved. Now, the order be communicated to the parties.
13. The appeal could not be decided within the statutory period because of the heavy pendency of the court cases.
(BALDEV SINGH SEKHON) PRESIDING MEMBER (JASBIR SINGH GILL) MEMBER April 22, 2014 VINAY