National Consumer Disputes Redressal
Neelam Chopra vs Life Insurance Corporation Of India on 8 October, 2018
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI REVISION PETITION NO. 4461 OF 2012 (Against the Order dated 03/08/2012 in Appeal No. 109/2012 of the State Commission Haryana) 1. NEELAM CHOPRA W/o Late Sh. Rakesh Chopra, R/o H.No-2738 C. MIG Super. Sector-70, MOHALI PUNJAB ...........Petitioner(s) Versus 1. LIFE INSURANCE CORPORATION OF INDIA Through its Senior Divisional Manager, Jeewwam Deep Building, Sector-17, CHANDIGARH 2. Sr.Divisional Manager, Divisional Office. LIC Of India, P.O Box No-106, Jeevan Prakash Model Town KARNAL HARYANA 3. The Branch Manager, LIC Of India Sector-2 Branch, PANCHKULA HARYANA ...........Respondent(s)
BEFORE: HON'BLE MR. PREM NARAIN,PRESIDING MEMBER
For the Petitioner : Mr. A.C.Chaudhary , Advocate For the Respondent : Mr. Pankul Nagpal, Advocate
Dated : 08 Oct 2018 ORDER
This revision petition has been filed by the petitioner Neelam Chopra challenging order dated 03.08.2012 of the State Consumer Disputes Redressal Commission, Haryana, (in short 'the State Commission') passed in First Appeal No.109 of 2012.
2. Brief facts leading to the institution of this complaint are that the husband of the complainant had submitted the proposal form for insurance of his own life on 24/01/2003 as medical case. He was medically examined by approved doctors of the respondents vide medical certificate dated 24.1.2003. Sh. Dharaminder Abrol agent of the opposite parties also submitted his confidential report on the same day. After examining the above documents, the respondents issued policy No.173304765 dated 21.02.2003 covering risk w.e.f. 25.12.2002 to 25.6.2026. It is submitted that the insured i.e. husband of the complainant died on 7.1.2004. The petitioner submitted claim form in connection with the claim under the policy along with certificate of hospital with the opposite parties on 24.08.2005. The petitioner also submitted discharge summary dated 9.2.2006. Further on demand of the opposite parties, the petitioner also submitted medical certificates dated11.04.2008 & 13.10.2008. However, the opposite parties vide letter dated 18.6.2009 repudiated the claim of the petitioner on the ground that the deceased had supressed material information regarding his health at the time of effecting the policy and also on the ground that claim has become time barred. It was alleged that the act and conduct of the opposite parties in repudiating the claim amounted to unfair trade practice & deficiency in service on their part due to which the complainant suffered great harassment, inconvenience & mental torture. The respondents filed the written statement before the District Consumer Disputes Redressal Forum, Panchkula, (in short 'the District Forum') and prayed for dismissal of the complaint. The respondents raised the preliminary objection of maintainability of the complaint being time barred as well as submitted that the insured was diabetic patient since five years and he was suffering from LL Hansen disease. The District Forum allowed the complaint vide its order dated 25.11.2011 and the following directions were issued to the opposite parties:-
"(i) To treat the communication/order dated 18.6.2009 as null and void; (ii) To pay the insurance claim amount of Rs.5 lakh along with an interest @12% thereon w.e.f. 18.06.2009 till its actual payment to the complainant. (iii) To pay a sum of Rs.25,000/- as compensation to the complainant on account of unnecessary mental agony and harassment caused to the complainant as well as for deficiency in service and unfair trade practices adopted by opposite parties. (iv) The opposite parties are also directed to pay a sum of Rs.5,000/- as costs of litigation to the complainant.
Let this order be complied with by the opposite parties within a period of 30 days from the date of communication thereof failing which the amount awarded in clause (iii) above will carry future interest @12% per annum thereon."
3. On 24.1.2012, the respondents challenged the order passed by the District Forum by way of filing first appeal before the State Commission. On 03.8.2012, the State Commission allowed the appeal of the respondents and set aside the order dated 25.11.2011 passed by the District Forum.
4. Hence, the present revision petition.
5. Heard the learned counsel for the parties and perused the record. Learned counsel for the petitioner stated that the District Forum had allowed the complaint and had correctly appreciated the evidence on record. However, the State Commission has allowed the appeal filed by the respondent/opposite parties on the basis of presumptions only.
6. Learned counsel for the petitioner stated that the proposal form was filled on 24.01.2003 and the insured was admitted in the hospital on 12.08.2003 and he was discharged on 24.9.2003. In the certificate of medical attendance filed by the opposite parties, it is clearly written that the insured was suffering from the disease from five months prior to the death. The death has occurred on 07.1.2004. Thus, the disease was existing only from July 2003 and not prior to this date. It clearly shows that the insured was not suffering from any disease prior to the filing of proposal form. The opposite parties have not filed any document prior to the date of filing of the proposal form, which shows that the insured was suffering from any disease. The certificate of medical attendance also clearly states that the diabetes was well controlled. If a disease is fully controlled and does not manifest itself, then there was no need to report it in the proposal form as it was really not existing at the time of filling of the proposal form.
7. It was pointed out by the learned counsel for the petitioner that in the history, it is mentioned that he was treated for LL Hansen in 2002. However, no treatment papers or proof for his treatment in the year 2002 has been filed. Moreover, this disease does not seem to have any correlation with the cause of death of the DLA as the Medical Attendance Certificate mentions the cause of death as 'cardio respiratory arrest'.
8. On the other hand, learned counsel for the opposite parties stated that cause of death was the cardio respiratory arrest. The insured was suffering from the disease of LL Hansen. The proposal form was filled on 24.01.2003. The inured was admitted to the hospital on 12.08.2003. In the medical attendance certificate, it is clearly mentioned that the insured was suffering from five months before death. This certificate also records that the patient was suffering from diabetes for five years. Clearly the insured has suppressed all this material information in the proposal form. In the certificate of hospital treatment also, it is clearly mentioned that the insured was suffering from diabetes for five years.
9. Learned counsel for the opposite parties stated that the State Commission has thoroughly examined all the medical records available on the record. The State Commission has observed the following:-
"Undisputedly the life assured had obtained the Insurance policy bearing No.173303765 dated 21.02.2003 for Rs.5,00,000/- and died on 07.01.2004. The life assured was suffering from the aforesaid illness prior to the date of purchasing the Insurance Policy as is evident from the Form No.3816 (Annexure A-3), page 31) & (Annexure A-4, page 34). The life assured was diabetic patient for the last five years as per form No.38 of Dr. Sanjay Bansal, Hospital of Chandigarh. The life assured was also treated for LL Hansen disease in the year 2002 and his diabetic disease was first observed 3-4 years before admission in the PGI, Chandigarh from 01.08.2003 to 11.08.2003 as per record of PGI, Chandigarh. But this fact was not disclosed by the life assured in the proposal forum."
10. I have carefully considered the arguments advanced by both the learned counsel for the contesting parties and examined the record. It is mentioned in the Medical Attendance certificate that the patient was suffering from five months before the date of death by the disease. Clearly, the DLA died on 07.01.2004 and therefore, the disease on account of which the death occurred was not prevailing on the date of filing of the proposal form as the proposal form was filled on 24.01.2003. It has also been alleged that the DLA was suffering from diabetes as mentioned in the treatment record of PGI Chandigarh. He was suffering for 3-4 years from diabetes. In the certificate of Medical Attendance, it is also mentioned that the DLA was suffering from diabetes, however, diabetes was under control. So far as the life style diseases like diabetes and high blood pressure are concerned, Hon'ble High Court of Delhi has taken the following view in Hari Om Agarwal Vs. Oriental Insurance Co. Ltd., W.P.(C) No.656 of 2007, decided on 17.09.2007 :
"Insurance- Mediclaim-Reimbursement- Present Petition filed for appropriate directions to respondent to reimburse expenses incurred by him for his medical treatment, in accordance with policy of insurance- Held, there is no dispute that diabetes was a condition at time of submission of proposal, so was hyper tension-Petitioner was advised to undergo ECG, which he did- Insurer accepted proposal and issued cover note- It is universally known that hypertension and diabetes can lead to a host of ailments, such as stroke, cardiac disease, renal failure, liver complications depending upon varied factors- That implies that there is probability of such ailments, equally they can arise in non-diabetics or those without hypertension- It would be apparent that giving a textual effect to Clause 4.1 of policy would in most such cases render mediclaim cover meaningless- Policy would be reduced to a contract with no content, in event of happening of contingency- Therefore Clause 4.1 of policy cannot be allowed to override insurer's primary liability- Main purpose rule would have to be pressed into service- Insurer renewed policy after petitioner underwent CABG procedure- Therefore refusal by insurer to process and reimburse petitioner's claim is arbitrary and unreasonable- As a state agency, it has to set standards of model behaviour; its attitude here has displayed a contrary tendency- Therefore direction issued to respondent to process petitioner's claim, and ensure that he is reimbursed for procedure undergone by him according to claim lodged with it, within six weeks and petition allowed."
11. From the above, it is clear that the insurance claim cannot be denied on the ground of these life style diseases that are so common. However, it does not give any right to the person insured to suppress information in respect of such diseases. The person insured may suffer consequences in terms of the reduced claims.
12. In the present case, clearly the cause of death is cardio respiratory arrest and this disease was not existing when the proposal form was filled. Clearly, there is no suppression of material information in respect of this disease, which is the main cause of death. The other disease of LL Hansen, which was prevailing for five weeks on the date of admission on 01.08.2003 was also not existing when the proposal was filed by the DLA. The fact of DLA having been treated in the year 2002 for LL Hansen is not supported from any direct evidence though PGI Chandigarh in its certificate has mentioned that disease was treated in 2002. Moreover this disease does not have any correlation with the cause of death in the present case. Hon'ble Supreme Court in Sulbha Prakash Motegaonkar And Ors. Vs. Life Insurance Corporation of India, Civil Appeal No.8245 of 2015, decided on 05.10.2015 (SC) has held the following:-
"We have heard learned counsel for the parties.
It is not the case of the Insurance Company that the ailment that the deceased was suffering from was a life threatening disease which could or did cause the death of the insured. In fact, the clear case is that the deceased died due to ischaemic heart disease and also because of myocardial infarction. The concealment of lumbar spondylitis with PID with sciatica persuaded the respondent not to grant the insurance claim.
We are of the opinion that National Commission was in error in denying to the appellants the insurance claim and accepting the repudiation of the claim by the respondent. The death of the insured due to ischaemic heart disease and myocardial infarction had nothing to do with this lumbar spondylitis with PID with sciatica. In our considered opinion, since the alleged concealment was not of such a nature as would disentitle the deceased from getting his life insured, the repudiation of the claim was incorrect and not justified."
13. From the above observations of the Hon'ble Supreme Court, it is clear that suppression of any information relating to pre-existing disease if it has not resulted in death or has no direct relationship to cause of death, would not completely disentitle the claimant for the claim.
14. On the basis of the above examination, it can be said that the DLA died on account of "Cardio Respiratory Arrest" which was existing for only five months prior to the date of death. Thus, clearly, this disease was not prevailing when the proposal form was filled. The disease of diabetes, though was existing for some time but was under control at the time of filling up of the proposal form. Moreover, the non-disclosure of information in respect of this life style disease of diabetes, will not totally disentitle the complainant for indemnification of the claim in the light of the judgement of Hon'ble High Court of Delhi in Hari Om Agarwal Vs. Oriental Insurance Co. Ltd., (supra). Coming to the third disease of LL Hansen, it is seen from the treatment record of PGI Chandigarh that the DLA was admitted on 12.08.2003 and then he was suffering from LL Hansen disease for only 5 weeks, though in the history, it is recorded that he was treated for LL Hansen in the year 2002, however, no clear dates are mentioned. Thus, it seems that the disease was not active at the time of filing of the proposal form. In addition, this disease of LL Hansen has no relationship with the actual cause of death i.e. "Cardio Respiratory Arrest" and in the light of judgement of the Hon'ble Supreme Court in Sulbha Prakash Motegaonkar And Ors. Vs. Life Insurance Corporation of India (supra), its suppression would not lead to total denial of the claim. So, I am of the view that even if any information was suppressed in the proposal form, it cannot be treated as material information. Therefore, the petitioner/ complainant would be entitled to the insurance claim. In the circumstances, I do not intend to provide any interest on this insurance amount.
15. Based on the above discussion, the revision petition No.4461 of 2012 is allowed and order dated 03.08.2012 of the State Commission is set aside. The respondent Insurance Company/opposite party shall only pay the insurance amount of Rs.5,00,000/- (rupees five lakhs) to the petitioner/complainant within a period of 45 days from the date of receipt of this order. The compensation of Rs.25,000/- (rupees twenty five thousand only) and cost of Rs.5000/- (rupees five thousand only) as awarded by the District Forum are maintained. The order of the District Forum stands modified accordingly. If this order is not complied within time granted, amount of Rs.5,00,000/- (rupees five lakhs only) shall attract an interest @8% p.a. from the date of this order till actual payment. No order as to costs for this revision petition.
...................... PREM NARAIN PRESIDING MEMBER