State Consumer Disputes Redressal Commission
1. Smt. Susheela Muda vs 1. M/S. Hdfc Standard Life Insurance Co. ... on 24 July, 2024
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BEFORE THE TELANGANA STATE CONSUMER DISPUTES
REDRESSAL COMMISSION: HYDERABAD.
C.C.NO.107 OF 2016
Between:
1.Smt.Susheela Muda W/o Late Nageswamy Muda, Age:30 years, Occ: Household
2.M.Shivalal S/o. Late Nagaswamy Muda, Aged 10 years, Occ: Student
3.M.Harilal S/o. Late Nagaswamy Muda, Aged 8 years, Occ: Student
4.M.Baby Shivani D/o. Late Nagaswamy Muda, Aged 6 years, Occ:Student.
(2 to 4 are being minors represented by their natural mother Smt. Susheela M) All are R/o. H.No.1-8-1/B/94/29 Lambadi Tanda, Baghlingampally Hyderabad-44 ... Complainants And
1.M/s. HDFC STANDARD LIFE INSURANCE CO.LTD. Rep. by its Branch Manager Khammam-Kaman Bazar Branch 1st Floor, Door No.9-7-48 to 51, J.L. Towers Kaman Bazar, KHAMMAM-507 001.
2.M/s. HDFC STANDARD LIFE INSURANCE CO.LTD. Rep.by its Branch Manager Malakpet Branch, Hyderabad.
3.M/s. HDFC STANDARD LIFE INSURANCE CO.LTD. Rep.by its Manager 11th Floor, Lodha Excelus, Apollo Mills Compund N.M.Joshi Road, Mahalaxmi, Mumbai-400011.
... Opposite parties Counsel for the Complainants : M/s Koukuntla Siva Kumar Counsel for the Opposite Parties 1 to 3 : M/s. P. Ramachandran QUORUM: Hon'ble Sri K.Ranga Rao, Member-(J), & Hon'ble Smt.R.S.Rajeshree, Member (N-J).
WEDNESDAY , THE TWENTY FOURTH DAY OF JULY, TWO THOUSAND TWENTY FOUR.
Order : (Per Hon'ble Smt.R.S.Rajeshree, Member-Non -Judicial) 2 ******
01). This is a complaint filed by the Complainant u/s. 17(1)(a)(i) of Consumer Protection Act,1986 on 09.06.2016 against the opposite parties to direct them as follows:
i) To direct the opposite parties to pay the death claim for an amount of Rs.20,00,000/- to the complainants covered under the policy bearing No.16860193.
ii) To direct the opposite parties to pay an amount of Rs.10,00,000/- towards compensation towards causing mental agony to the complainants.
iii) To award costs.
02). Briefly stated facts of the case are that: The complainant no.1 is the wife of Nagaswamy Muda and complainant no.2 to 4 are his children and minors hence are being represented by their natural mother Smt. Susheela M. The deceased Nagaswamy Muda shall here in after be referred to as deceased insured. That the deceased life assured was working in M/s BSR Pharma Distributers situated at Kothapet, Hyderabad and drawing a salary of Rs 25,000/- per month. That during his life time he had purchased a insurance policy from HDFC Standard Life Insurance Company Ltd, Branch Khammam District, Telangana i.e. opposite party No.1 bearing No. 16860193, "HDFC Life Click to Protect." For a sum assured of Rs 20,00,000/-. The premium payable was Rs. 4,861/-
per annum for a period of 20 years where in the complainant No.1 was shown as nominee. That the opposite party being satisfied by the details submitted and the documents submitted by the deceased insured, had issued a policy on 17/06/2014. That unfortunately on 04/08/2014 the deceased assured died due to heart attack. That after the death of the insured, complainant No.1 approached the nearby opposite party office, who advised to make a claim by submitting the original death certificate and some other documents. Upon such advise she had submitted her claim to 2nd opposite party who had issued her a acknowledgement dated 13/08/2015. Taking advantage of the illiteracy and poor family back ground of the complainants the opposite parties dragged the issue of settling the death claim on one or the other pretext, finally on 20.01.2016 the opposite party No.3 had repudiated the claim by 3 way of a letter date 20.01.2016 on false and baseless grounds. Being aggrieved by the same the complainants got issued a legal notice on 08/02/2016. The notice of opposite party No.1 was returned with an endorsement addressee left but the notice sent to claims review committee was received but they failed to reply, that the deceased insured was the only bread winner of the family and all the complainants were dependent on him. That this act of repudiation of a genuine claim by the opposite parties amounts to deficiency of service which has caused severe inconvenience and mental agony to the complainants, as such having no other alternative the complainants are before this commission seeking insurance amount along with interest, compensation and costs.
03). The opposite party filed their written version while admitting the issuance of policy, premium amount and the sum assured, had opposed the complaint on the ground that the same is not maintainable either on law and on facts and further expressed their unawareness whether the complainants are the legal heirs of the deceased insured. The opposite parties further plead that they have never dragged or postponed the payment of insurance as alleged by the complainant, but were making inquiries with regard to the death of the insured and the genuineness of the claim. That the deceased life assured had obtained the policy with mala fide intention to cheat the opposite parties he had suppressed the true facts and despite not having the capacity to pay the premium amount he had suppressed the fact and obtained the policy, as such the complainants are not entitled for any relief. That upon verification it has been revealed that the deceased life assured was not working in a private firm but was actually working as a Rickshaw puller and his annual income was only Rs.20,000/- which is evident from his Ration card, by suppressing the said fact the policy was obtained. The deceased life assured has given a false statement in the proposal form that he is a private employee and that his annual income is Rs.3,00,000/- per annum.
That the insurance is a subject matter of solicitation, the agent collects the information from the proposer after briefing the customer with the terms and conditions of policy and after fully understanding the terms and conditions the deceased policy holder 4 had submitted the proposal and had given a declaration that he had read and understood the terms and conditions of the policy. The opposite parties further pleads that the deceased life assured had obtained the policy by misrepresenting the material facts in order to defraud the opposite parties. The opposite parties had relied on the Apex court judgement Satwant Kaur Sandhu Vs New India Assurance Co. Ltd. Where in the Hon'ble supreme court had held that it was obligatory on the part of the proposer to disclose all the facts in the proposal form which helps the insurer to assess the risk and to take a decision whether to accept the proposal or reject the same. That the deceased life assured had mis-stated the material facts in his proposal form as such the complainants are not entitled for any relief, hence prayed that the complaint be dismissed.
04). The complainant No.1 filed evidence affidavit and got marked Exs.A1 to A9. B. Kumar, authorized Assistant Manager Legal of opposite party no.1 filed his evidence affidavit as RW.1 Exs.B1 to B4 are marked on behalf of the opposite parties.
05). Heard the counsel for opposite parties. Complainant failed to appear & conduct their case since 05.01.2022 as such the arguments of complainants were treated as heard. Perused the record.
06). The points for consideration:
i. Whether the opposite parties have been deficient in their services?
ii. Whether the complainant is entitled for the reliefs sought for in the complaint?
iii. If yes, to what relief? 07). Point No.i: the specific case of the complainants is that the
deceased life assured during his life time has taken a life insurance policy from the opposite parties, to which the complainant no.1 is the nominee. That after the death of the deceased life assured the nominee had made a claim before the opposite parties by submitting all the required documents, but the opposite parties have repudiated their claim on false and baseless grounds. In support of their case the complainants got marked Ex A1 to A9.5
Issuance of policy, sum assured and premium amount are not in dispute. The only ground on which the opposite parties have repudiated the claim is that the deceased life assured has misstated the details of his occupation and income in the proposal form which was later revealed during the claim investigation, had the proposer stated the correct facts the insurance company would not have issued the policy. To substantiate their case the opposite parties had drawn our attention to Ex B1 proposal form, Ex B2 investigation report, and Ex B3 Ration card. Under Ex B1 proposal from the personal details of the life to be assured are mentioned as follows :
Present Occupation details : Self employed/Business Designation : Private Employee Gross Yearly Income from all sources (Rs) : 300000 Name of present employer/business : Private Job Whereas under Ex B3 Ration card the deceased life assured's occupation is mentioned as Rickshaw Puller and annual income is mentioned as Rs 20,000/- Ex B2 is the surveyor report consisting of two reports one issued by Stellar insurance management services Pvt. Ltd. Dated 15/09/2015 and another by Accurate Facts Management Services dated 14/12/2015 by relying on Ex B2 and B3 the opposite party had repudiated the claim. A keen perusal of the details mentioned in the proposal form as stated supra reveal that the proposer had stated that he is self employed and at column, Name of the employer he just filled as private job without specifying any details of the company he is working.
There is no dispute that it is an early claim. As per section 45 of Insurance act, in a claim that arises within 3 years of availing of insurance policy the insurance company can question the policy and repudiate the policy on the ground of suppression of material facts, provided the insurance company is able to prove that the proposer had suppressed the material facts that were in the exclusive knowledge of the proposer. Now the points that arise are :
whether the above referred questions in the proposal form are 6 material facts and whether the insurance company had proved the suppression of facts.
In a very recent judgement Mahakali Sujatha Vs The Branch Manager, Future Generali India Life Insurance company Limited & another, Civil Appeal No. 3821 of 2024,order dated 10/04/2024 the Hon'ble supreme court had dealt with these two issues and had explained in detail at Para no. 21, as to what can be considered to be material facts and finally concluded that the material facts should be construed based on the facts of each case and further it is settled law that it is the insurance company which decides which facts that are material for it to issue a policy. Further at Para no. 41 to 46 The Hon'ble Supreme court has dealt in detail with regard to Burden of proof and Onus of proof and after thorough discussion on Section 101 to 106 of Indian Evidence Act, 1872, concluded that it has to be analysed if the insurance company had discharged its burden of proof about the fact of suppression of a fact. Considering the discussions done by the Hon'ble Supreme court in the above referred case, in the instant case the opposite party had substantiated their case by filing Ex B3, Ration card & B2, Surveyor report. Even if it is presumed that the details mentioned in Ex B3, Ration card are wrong and were mentioned only to avail the benefits under the Ration card, but in the surveyor report dated 04/12/2015 The surveyor had specifically reported as under
LA was an auto driver and was not working with BSR Pharma Distributors as mentioned in the proposal. We had visited the given address in the BSR Pharma Distributors letter but did not find any business establishments. We visited the Drug Control Administration, vegal Rao nagar to verify the dealer's license of BSR Pharma Distributors i.e. AP/15/05/2013- 105488 and found to be genuine but the address is mentioned as Dno:-12-1-485, Anand Nagar, Co Op Bank Colony, Nagole road, Bandlaguda village, Uppal, Hyderabad and the proprietor as Mr. S Santhosh Reddy (9160205346). The license expires on 2018. At the said address we did not find any BSR Pharma Distributors office. we tried to contact Mr. S.Santosh Reddy through phone but the name number was not valid.7
We contacted the number 8978959890 which is mentioned in the WWW.Zonaliinfo.com for BSR Pharma Distributor where the phone receiver replayed by saying wrong number.
We had also contacted the number mentioned in the employment certificate submitted at the time of proposal i.e. 9494238055 who is not responding properly and saying that the company has been shut down.
08). When the opposite party had come up with such investigation report, the burden shifts on the complainant to prove that the proposer/ insured was working at BSR Pharma Distributors as on date of making the proposal. In fact as per section 101 of Evidence act, the burden of proving a fact always lies on the person who asserts the same. In the instant case the complainant herself states in her complaint and Evidence affidavit that her deceased husband i.e. life assured, during his life time was working in BSR Pharma Distributors, in such case the initial burden is on the complainant to prove that her deceased husband was working at BSR Pharma Distributors. Further when the opposite party had come up with the Ex B2 investigation report, it becomes more obligatory on the part of the complainants to come up with valid documentary evidence to prove that the life assured, was working with BSR Pharma Distributors. But there is no such proof coming forth from the complainants. Though it is true that the opposite parties have not proved substantially that the Deceased insured was an Auto Driver, but the complainants cannot rest their complaint on the weakness of the opposite party, the complainants have to prove the facts asserted by them. No scrap of paper is filed by the complainant to prove that the deceased life assured was working with BSR Pharma Distributors and that his annual income was Rs 3,00,000/- per annum. We fail to understand what stopped the complainants from filing either the identity card, salary certificate, statement of account showing the salary received from BSR Pharma Distributors or at least an affidavit from the employer to show that the deceased life assured was working with BSR Pharma Distributors. Therefore in the absence of any proof coming forth from the complainant to prove that the deceased life assured was working at BSR Distributors and 8 that his Annual income was Rs. 3,00,000/- on the other hand the opposite party by filing Ex B2 & B3 had proved that the deceased life assured was not employed at BSR Pharma Distributors.
09). Based on the above discussion though we have sympathy for the complainants that the complainant no. 1 had lost her husband and complainant no.2 to 3 have lost their father, but since the complainants who are pleading that the deceased life assured was working at BSR Pharma Distributors and that his income was Rs 3,00,000/- per annum had failed to prove the same.
Therefore we have no hesitation to conclude that the deceased life assured had suppressed the material facts and had obtained the policy, hence the policy is voidable at the instance of the opposite party. However here we make it clear at the cost of repetition that the complainants did not choose to appear to conduct their case since 05.01.2022 and failed to prove their case with substantial & cogent evidence.
Hence we are of the emphatic view that the complaint is liable to be dismissed.
In the result, the complaint is dismissed however the opposite parties are directed to return the premium amount paid by the deceased husband of Complainant No.1 within 30 days from the date of receipt of this order.
Typed to the dictation to the Stenographer on system, corrected and pronounced by us in the open bench on 24.07.2024.
SD/- SD/-
----------------------- ----------------- MEMBER (J) MEMBER (M-NJ) Dated:24.07.2024.
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APPENDIX OF EVIDENCE
Witnesses examined
Evidence affidavit of Evidence affidavit of
The Complainants: Opposite party:
PW1: Smt. Susheela Muda RW1: B.Kumar
Exhibits marked on behalf of the complainant:
Ex.A1 : Photostat copy of Policy Bond bearing No.16860193 issued by opposite party.
Ex.A2 : Photostat copy of Death Certificate of Nagaswamy Muda. Ex.A3 : Photostat copy of Ration Card of the complainant. Ex.A4 : Photostat copy of Aadhaar Card of the Complainant. Ex.A5 : Photostat copy of Acknowledgement issued by the opposite party dt.13.08.2016.
Ex.A6 :Photostat of claim rejected letter issued by opposite party dt.20.01.2016.
Ex.A7 : Photostat Copy of legal notice dt.08.02.2016. Ex.A8 : Photostat Copy of served Acknowledgement. Ex.A9 : Photostat copy of Returned Envelope addressed to opposite party No.1.
Exhibits marked on behalf of the opposite parties:
Ex.B1 : Photostat copy of Proposal Form.
Ex.B2 : Photostat copy of Investigator's Report in Life Insurance Claim Case.
Ex.B3 : Photostat copy of Ration Card.
Ex.B4 : Photostat copy of Repudiation letter.
MEMBER(J) MEMBER(NJ)
---------------------------------------- Dated : 24.07.2024