State Consumer Disputes Redressal Commission
Bharati Axa Life Insurance Company Ltd. vs Ankam Yadagiri on 25 February, 2026
1
BEFORE THE TELANGANA STATE CONSUM ER DISPUTES
REDRESSAL COM M ISSION : HYDERABAD.
F.A.No. 455 OF 2023
AGAINST ORDERS IN C.C.454/2022
DISTRICT CONSUM ER COM M ISSION-III, HYDERABAD
Between:
The Manager, Bharti AXA Life Insurance Company Limited,
Spectrum Towers, 3rd Floor, Malad Link Road,
Malad (West) Mumbai- 400 064, Maharastra,
As per Cause Title in CC 454/2022
Bharti AXA Life Insurance Company Limited,
Having its registered office at "Unit No.1902,
19th Floor, Parinee Crescenzo, G Block,
Bandra Kurla Complex, BKC Road,
Opposite MCA Ground, Bandra (East),
Mumbai, Maharastra- 400 051.
Represented through its Authorized Representative
Ms.Snehal Sawant, D/o S.Sawant,
Aged about 33, Occ.: Senior Manager-Legal,
O/o Bharti AXA Life Insurance Co., Ltd.,
...........Appellant/ Opposite Party
And:
Sri Ankam Yadagiri, S/o Ramulu,
Aged about 73, Occ.: Nil,
R/o Flat No.202C, Gowtham Towers,
Bapunagar, Chikkadpally, Hyderabad-500 020.
........Respondent/Complainant
Counsel for the Appellant/Opposite Party : M/s.Manav Gecil
Thomas
Counsel for the Respondent/Complainant : M/s. K. Srinivas
QUORUM:
HON'BLE SM T. JUSTICE DR.G.RADHA RANI, PRESIDENT
HON'BLE SM T. M EENA RAM ANATHAN, M EM BER (NJ)
W EDNESDAY, THE 25th DAY OF FEBRUARY
TW O THOUSAND TW ENTY SIX
******
2
Order:
PER HON'BLE SM T. JUSTICE DR.G.RADHA RANI, PRESIDENT
1.The appeal is filed by the opposite party Insurance Company, aggrieved by the order dated 01.05.2023 in CC 454/2022 on the file of District Consumer Disputes Redressal Commission-III, Hyderabad, wherein the complaint filed by the Respondent/complainant was allowed in part, directing the opposite party to pay Rs.15,72,034/- along with interest at 6% p.a. from the date of repudiation letter till the date of realization and to pay costs of Rs.5,000/-.
2. The parties are herein after referred as arrayed before the District Consumer Commission as complainant and the opposite party.
3. (a) The case of the complainant in brief was that the complainant was the husband and nominee of the deceased by name Ankam Nagamani. On 19.06.2019, the deceased Ankam Nagamani had taken Life Insurance policy from opposite party vide policy No.501-9265916. The deceased Nagamani paid 1 st premium of Rs.1,54,480/- on 19.06.2019 and 2nd premium of Rs.1,51,318.71ps. on 30.07.2020 (wrongly mentioned as 20.06.2021). The opposite party assured a sum of Rs.15,72,034/- towards death benefit and 40 days hospital cash benefit rider. On 22.10.2020 the deceased Ankam Nagamani suffered with Covid-19, due to which she was admitted in ICU Ward of Continental Hospital, Hyderabad as in-patient. While undergoing treatment in the said hospital, the deceased Nagamani succumbed due to cardiac arrest on 07.11.2020. The complainant spent an amount of Rs.9,77,111.34 ps towards medical treatment of the deceased in the said hospital. After the death of the deceased life assured, Ankam Nagarmani, the complainant submitted claim intimation to 3 the opposite party on 15.12.2020 claiming death benefit and hospital treatment expenses of Nagamani. After a gap of 15 days, on 31.12.2020, the opposite party sent claim repudiation letter on the ground of "non-disclosure of material information at the time of making proposal". On 25.02.2021 the complainant sent his complaint to opposite party Grievance Redressal Cell, Mumbai . But the said Greivance Redressal Cell not replied and dodged the matter. Vexed, the complainant approached the office of Insurance Ombudsman, Hyderabad and filed a complaint. However, the Insurance Ombudsman dismissed the complaint on 09.06.2021. As such, the complainant was forced to approach the District Commission for legal remedy against the opposite party.
(b) The complainant further submitted that the proposal form was not signed by deceased life assured Nagamani, the agent of the opposite party did not choose to take the same from her, for the reasons known to him. The opposite party did not refund premium amount paid. As per the policy condition 7, in case of repudiation, on ground of mis-statement and not on fraud, the premium collected on policy shall be paid to the insured or legal representative or nominee or assignees of insured within the period of 90 days from the date of repudiation. The opposite party violated the said condition. The deceased Nagamani was treated as in- patient in ICU ward in Continental Hospital from 22.10.2020 to 07.11.2020. Therefore, the opposite party was liable to pay 17 days of ICU benefit Rs.4,000 x 17 days = Rs.68,000/-, but the said amount was not paid. There was absolute deficiency of service on the part of the opposite party as such, the complainant claimed an amount of Rs.15,72,034/- towards sum assured for death benefit of deceased, Rs.2,00,000/- towards mental agony and Rs.1,59,966/- towards costs of the complaint, in total claimed an amount of Rs.20,00,000/- with interest at 24% per annum from the date of claim intimation i.e. 15.12.2020 till realization.
44. a) The opposite party filed written version raising preliminary objections that the complaint would not fall under "Consumer Dispute" as defined u/s 2 (8) of the Consumer Protection Act, 2019. At the time of issuance of policy, the policy holder after reading the terms of the policy only signs the proposal form and therefore, the policy holder is bound by the terms and conditions of the policy. The deceased life assured had subscribed to the "Bharti AXA Life Elite Advantage" which offers financial security in case of death, as well as a vehicle for saving and growing wealth in their best mental and physical capacity. The opposite party Company received claim from the complainant that the life assured died due to Covid-19. Upon receipt of the claim, the opposite party Company duly investigated the claim and found that the deceased life assured has suppressed the information about her health. In furtherance of malafide intent, the deceased life assured mis-led the fact of her health and treatment that she was diagnosed as Atypical LRTI as well as a known case of hypertension and diabetes and also suffering from Rheumatoid Arthritis and was on insulin which was prior to issuance of the policy in question which was a material fact. The claim repudiation was justified on the ground of violation of "Uberrimae - fides" principal and Sec.45 of the Insurance Act, 1938 which categorically mentions suppression of fact as a ground for repudiation of insurance contract.
b) The opposite party further contended that as per the discharge summary received from Aditya Hospital dated 01.01.2018, the Deceased Life Assured (DLA) was suffering from Atypical LRTI as well as was a known case of hypertension and diabetes and was also suffering from Rheumatoid Arthritis and was on insulin. If the same was known to the opposite party during the proposal stage, they would have declined rider as well as base plan to the DLA. The suppression of the said material information about her health condition amounts to an attempt to commit fraud on the Company and to gain unlawfully at the expense of the Company. The provisions of the Contract Act, 1872 stipulates that 5 where any contract has been entered into on the basis of a fraud, then such contract is voidable at the option of the aggrieved party and hence, the opposite party was justified in repudiating the claim of the complainant and the complaint deserves to be dismissed at the threshold and prayed to dismiss the complaint with exemplary costs.
5. Before the District Commission, the complainant was examined as PW1 and Ex.A1 & A2 are marked on his behalf. The Senior Manager, Legal of the Insurance Company was examined as DW1 and Ex.B1 to B8 are marked on behalf of the opposite party.
6. The District Commission on considering the evidence on record and the oral & written submissions of both the parties, allowed the complaint in part as stated supra.
7. Aggrieved by the said order, the opposite party preferred this appeal contending that there was no denial on the part of the complainant on the factum of concealment of medical illness, therefore, such concealment can be assumed to be true.
The District Commission failed to appreciate that the complainant suppressed the material facts and that the policy was repudiated for the said reason.
The District Commission failed to appreciate the settled position of law as held by the Hon'ble Apex Court in the case of Reliance Life Insurance Co., Ltd., and Ors. vs. Rekhaben Nareshbhai Rathod, (2019 ) 6 SCALE 734. The District Commission failed to appreciate that Deceased Life Assured (DLA) was diagnosed with Atypical LRTI as well as a known case of hypertension and diabetes and suffering from Rheumatoid Arthritis and was on insulin which was prior to issuance of the policy in question which was a material fact.
The District Commission had placed reliance on Manmohan Nanda vs. United India Insurance, I (2022) CPJ 20 (SC) 6 which was not applicable to this case. The facts were distinct. In this case, the disclosure was made by the insured.
The District Commission erroneously held that there was no nexus between the death and suppression of earlier diseases and failed to appreciate that the existing diseases added to co-morbidity factor which was vital for Covid-19 infection and thus the question of nexus was also answered. The District Commission failed to appreciate that the question of nexus between the death and suppression of earlier disease does not even arise when there was express/active concealment on the part of Deceased Life Assured (DLA) which rendered the insurance agreement void ab initio and prayed to allow the appeal.
8. Heard the learned counsel for the appellant M/s Manav Gecil Thomas and the learned counsel for the respondent/complainant M/s K.Srinivas.
9. Now the points for consideration are :-
1) Whether the impugned order suffers from any error or illegality to set aside the same?
2) To what result?
10. Point No.1:- On a perusal of the record, the complainant got marked the photocopy of the Claim Repudiation Letter issued by the opposite party dated 31.12.2020 as Ex.A1 and photocopy of the order of the Insurance Ombudsman, Hyderabad, dated 09.06.2021 as Ex.A2. As per Ex.A1, the repudiation was made on the basis of the medical documents procured by them, wherein it was established that the life insured was a known case of hypertension, diabetes mellitus, Rheumatoid Arthritis and was under treatment for the same and the said history was prior to her proposal for insurance and that she replied in the proposal form in negative to question No.7 (4) a & b.
711. Question No.7 pertains to the health records of the life insured. It is as follows:-
7. Health Records of Life to be Insured
4. Have you ever had or received medical advice or treatment for any of the following:-
a) disorders of blood Yes No
pressure, chest pain, any heart √
disease, stroke, epilepsy,
Cancer (including skin cancers)
or any tumor, lump, cyst,
polyps or growth of any kind.
b) Asthama any respiratory Yes No
disease, kidney or urinary tract
disease, mental or any nervous
disease, any liver disease, any
√
blood disorders (including
anemia), any digestive and
bowel disorder, raised blood
sugars, any metabolic or
endocrine disorder (including
thyroid disorders) , disorders of
ears & eyes, problems of stones
in any organ in the body.
12. The opposite party contended in the said letter that the life insured had given false and misleading information to the Company. If she had replied to the aforesaid questions truthfully and correctly in the proposal form, the Company would not have issued the policy at all, as such they repudiated the claim for non -
disclosure of the material information at the time of making the proposal.
13. As seen from Ex.A2, the order of the Insurance Ombudsman dated 09.06.2021, it was recorded that "It was clear that the complainant had taken treatment for multiple heath issues before taking the policy but she did n't disclose the same in the proposal form. The life assured had replied in negative for question No.7(4) (a) & (b) wherein she was asked whether she had ever received medical advice or treatment for any 8 respiratory disease, kidney disease, liver disease, urinary tract disease or nervous disease. The complainant didn't dispute the health history and medical records of the life assured submitted by the insurer, but his contention was that, while taking the policy the sales person was informed that the life assured suffered from diabetes and hypertension. This contention of the complainant can't be accepted as he didn't submit any evidence to establish that the sale person was informed about the pre-existing ailments of the life assured. Hence, the Forum has no other option but to agree with the submission of the insurer that the life assured had suppressed material facts regarding her health and medical history while taking the policy.
A contract of insurance is governed by the principle of "Uberima fides'. In other words, it is a contract of utmost good faith wherein the life assured was duty bound to disclose all facts material to the contract while taking the policy. But it was clearly evident from the medical records that the life assured had withheld material information pertaining to her health and medical history while taking the policy".
14. The documents marked by the opposite party are as follows:-
Ex.B1 is the proposal form;
Ex.B2 is the claim form along with claim investigation reports and medical records;
Ex.B3 is the claim repudiation letter , dated 31.12.2020;
Ex.B4 is the copy of the award of the Insurance Ombudsman.
Ex.B5 is the copy of the proposal form for life insured;
Ex.B6 is the copy of Department of Molecular Biology report issued by Aditya Hospital, dated 13.10.2020.
Ex.B7 is the claim repudiation letter and Ex.B8 is the copy of the death claim of Ms.Ankam Nagamani.
15. Ex.B6 is the record of discharge summary issued by Aditya Hospital. It would disclose that the deceased life assured Mrs.Ankam Nagamani was admitted in the said hospital on 30.12.2017 and was discharged on 01.01.2018 and at the time of admission, she was diagnosed with Atypical LRTI, known case of hypertension and DM-II, Rheumatoid Arthritis. This was prior to obtaining the policy by the insured on 19.06.2019. Death of the deceased due to Covid-19 on 07.11.2020 is also not in dispute. As 9 per the death summary, the patient was admitted in ICU in view of dyspnea and respiratory insufficiency. Her condition worsened on 04.11.2020 and she was put on mechanical ventilator. On 07.11.2020 she developed hypotension and sustained cardiac arrest. The cause of death was recorded as "severe covid pneumonia".
16. As seen from the above documents, the life assured was suffering from atypical lower respiratory tract infection and Rheumatoid Arthritis an auto immune disease, prior to obtaining the policy. The proposal form required disclosure of any past or present ill-ness,, but the life assured answered the relevant columns in the negative making a false declaration. The discharge summary of the Aditya Hospital produced by the opposite party, clearly reveal pre-policy treatment and diagnoses which were within the knowledge of the insured. It is settled law that suppression of material facts render the contract voidable at the instance of the insurer. In Satwant Kaur Sandhu vs. New India Assurance Company Ltd., (2009) 8 SCC 316, the Hon'ble Apex Court held that "non-disclosure of the material information in the proposal form entitles insured to repudiate policy. Incorrect answers in the proposal form regarding health conditions, amounts to suppression of material facts".
17. The life assured died due to Covid-19 infection affecting the respiratory system. The Atypical LRTI and Rheumatoid Arthritis which was an auto immune disorder could affect multiple organs including lungs and may lead to compromised immunity and increased susceptibility to severe respiratory infections. Therefore, both the above diseases had a direct bearing on the underwriting risk. There was a clear nexus between the suppressed illnesses and the eventual cause of death, which materially aggravated the risk and contributed to vulnerability. If the opposite party was aware that the life insured was suffering with the said disease s, they might have declined the proposal or called for a detailed medical under writing. Treatment taken by the life assured and 10 prior diagnosis of the above diseases demonstrate knowledge on the part of the insured.
18. It is settled law that the Consumer Fora cannot rewrite the terms of the insurance contract. As the repudiation was based on verified medical records and policy terms, the same cannot be considered as deficiency of service. The Hon'ble Apex Court in several judgments held that "the contract of insurance is contract "Uberrimae-fides (utmost god faith)" and there must be complete good faith on the part of the assured. The assured is thus under a solemn obligation to make full disclosure of material facts which may be relevant for the insurer to take into account while deciding whether the proposal should be accepted or not. While making a disclosure of the relevant facts, the duty of the insured to state them correctly cannot be diluted".
19. The reliance placed by the District Forum with regard to the judgment of the Hon'ble Apex Court in Manmohan Nanda vs. United India Insurance, I (2022) CPJ 20 (SC) was mis-placed as the said facts were distinct. In the said case, the columns in the proposal form were left blank. But in the present case, the columns were answered in negative. The contention of the complainant that the columns were filled by the agent and not by the deceased life assured, doesn't stand to merit in view of the judgment of the Hon'ble Apex Court in Reliance Life Insurance Co., Ltd., vs. Rekhaben Nareshbhai Rathod, (2019) 6 SCC 195, wherein it was held that:
36. "Finally, the argument of the respondent that the signatures of the assured on the form were taken without explaining the details cannot be accepted. A similar argument was correctly rejected in a decision of a Division Bench of the Mysore High Court in V.K.Srinivasa Setty vs. Premier Life and General Insurance Co., Ltd., wherein it was held : (SCC Online Karnataka paras 80-81).
80. Now it is clear that a person who affixes his signature to a proposal which contains a sta tement which is not true, cannot ordinarily escape from the consequence arising there from by pleading that he chose to sign the proposal containing such statement without either reading or understanding it. That i s because, in filling up the proposal form, the agent normally ceases to act as agent of the insurer but becomes the agent of the insured and 11 no agent can be assumed to have authority from the insurer to write the answers in the proposal form.
81. If an agent nevertheless does tha t, he becomes merely the amanuensis of the insured and his knowledge of the untruth or inaccuracy of any statement contained in the form of proposal does not become the knowledge of the insurer. Further, apart from any question of imputed knowledge, the insured by signing that proposal adopts those answers and makes them his own and that would clearly be so, whether the insured signed the proposal without reading or understanding it, it being irrelevant to consider how the inaccuracy arose if he has contracted, as the plaintiff has done in this case that his written answers shall be accurate".
20. Thus, we are of the considered view that the District Commission committed an error and material illegality by allowing the complaint as against the terms and conditions of the policy, when the repudiation was made basing on verified medical records supported by documentary evidence.
21. Point No.2:- In the result, the appeal is allowed setting aside the order passed by the District Consumer Disputes Redressal Commission-III, Hyderabad in CC 454/2022 dated 01.05.2023.
The appellant is permitted to withdraw the amount deposited by them at the time of filing the appeal along with the accrued interest thereon, after the appeal time.
Dictated to the Stenographer and transcribed by her on the System; corrected by me and pronounced by us in the Open Court on this the 25th day of February' 2026.
Sd/- Sd/-
PRESIDENT M EM BER (NON-JUDICIAL)
Dated : 25.02.2026
*AD