National Consumer Disputes Redressal
Lic Of India vs Smt.Rukma on 1 March, 2012
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI REVISION PETITION NO.1526 OF 2007 (From the order dated 17.01.2007 in Appeal No.454/1999 of the State Commission, Rajasthan) LIC of India Petitioner(s) Versus Smt.Rukma Respondent(s) BEFORE : HONBLE MR.JUSTICE ASHOK BHAN, PRESIDENT HONBLE MRS. VINEETA RAI, MEMBER For the Petitioners(s) : Mr.U.C. Mittal, Advocate For the Respondent(s) : NEMO. Pronounced on 1st March, 2012 ORDER
PER VINEETA RAI, MEMBER This revision petition has been filed by LIC of India (hereinafter referred to as the Petitioner) being aggrieved by the order of the State Consumer Disputes Redressal Commission, Rajasthan (hereinafter referred to as the State Commission) in Appeal No.454/1999 in which Smt.Rukma who was the original complainant before the District Forum, is the Respondent.
In her complaint before the District Forum, Respondent had stated that her late husband, Rameshwar Lal Chaudhary (hereinafter referred to as insuree) had obtained an insurance policy from Petitioner/Insurance Corporation for Rs.50,000/- for the period from 26.11.1994 under New Jan Raksha Plan (Profit with Accidental Benefit). The premium was regularly paid and there was no default.
The insuree expired on 26.10.1995 and the Respondent as his nominee filed an insurance claim with the Petitioner along with relevant information and documents as required by the Petitioner. However, on 21.02.1997, Petitioner/Insurance Corporation repudiated the claim of the Respondent on the grounds that the insuree had suppressed material information regarding his health at the time of filling up the insurance proposal form by not divulging in the relevant column that 4 years and 8 months prior to his taking the insurance policy, he had suffered from a head injury for which he had taken treatment in a hospital and had also filed a case in the Motor Accident Claims Tribunal(MACT) in which he had cited the facts regarding his head injury.
Respondent, however, challenged the repudiation letter on the grounds that the cause of death of her husband due to Epilepsy was not related to the injury sustained in the accident. Under the circumstances, no material fact or information was concealed and since the claim was wrongly repudiated, Respondent filed a complaint before the District Forum on grounds of deficiency in service and requested that Petitioner be directed to pay her a sum of Rs.50,000/- towards the insurance claim of the insuree with interest @ 24% per annum, Rs.1 lakh towards mental agony and harassment and Rs.2,200/- as litigation cost.
The above contentions were denied by the Petitioner who stated that there was evidence on record including in the case filed by the insuree before MACT claiming Rs.3,86,500/- for loss of memory and understanding power because of the head injury which he had suffered in the accident on 18.03.1990. Since, this important information had been withheld while filling-up the insurance proposal form and the insuree had given incorrect information the claim was rightly repudiated.
The District Forum after hearing both parties and considering the evidence on record dismissed the complaint on the grounds that there was adequate evidence on record to prove that the insuree had suffered a head injury and the Epilepsy due to which he expired was a result of the earlier head injury. Further, the facts pertaining to the head injury had not been disclosed in the proposal form and since an insurance policy is a contract entered in utmost good faith between the parties, by not disclosing that he had suffered a head injury, insuree had breached the contract of insurance and therefore, the claim was rightly repudiated.
Aggrieved by this, Respondent filed an appeal before the State Commission which allowed the same by observing as follows:
In our considered opinion, since there is no documentary proof or evidence available on record to show that the deceased was admitted in the hospital for treatment of disease epilepsy prior to 29.10.94, therefore, it could not be said that the deceased was guilty of suppressing material facts about his health especially when there is nothing on record to show that the attack of epilepsy was the direct result of head injury that had taken place in the month of March, 1990.
Apart from that epilepsy is recurrent disorder of cerebral function characterized by sudden, brief attacks of altered consciousness, motor activity or sensory phenomena. Apart from that attempt to find a cause for the sudden abnormal discharge of cerebral neutons is not possible in all types of epilepsy.
Therefore, in this case attack of epilepsy could be due to so many reasons and that could not be confined alone to that head injury that is alleged to have taken place more than four years back in March, 1990.
Thus, from every point of view it could not be said that if the deceased had suppressed his head injury of the year 1990, it would not amount to suppression of material facts on his part in the manner that suppression must be fraudulently and mere concealment of some facts does not amount to concealment of material facts.
The result is that respondents had failed to prove any nexus between the disease of the deceased which had taken place on 25.10.95 with the accident that had taken place in the month of March, 1990.
Hence, the present revision petition.
Counsel for Petitioner was present. Despite service of notice, none appeared on behalf of the Respondent.
Since service is complete, the case is being decided ex parte.
Learned Counsel for Petitioner pointed out that the State Commission erred in concluding that the insuree had not suppressed any material fact regarding his head injury because Respondent had failed to prove any nexus between the disease (Epilepsy) because of the which the insuree expired and the accident that had taken place on 18.03.1990 and mere concealment of some facts does not amount to concealment of material facts.
On the other hand, as per medical literature on the subject, it is well established that Epilepsy is often caused because of head injuries or any trauma to the brain so there is a clear nexus between the insurees earlier head injury and his death due to Epilepsy. In any case, the accident resulting in the head injury was quite serious because in his claim before the MACT, the insuree had admitted that it had resulted in loss of memory and other medical problems. It is well established in a catena of judgments of the Apex Court as well as of this Commission that the fundamental principle of insurance law is that utmost good faith must be observed by the contracting parties and suppression of any material facts justifies repudiation of an insurance claim. In the instant case, in the insurance proposal form it is not in dispute that the insuree had written No against the query Did you ever have any accident or injury? Therefore, there was no deficiency in service and the claim was rightly repudiated.
We have considered the averments made by the learned Counsel for Petitioner and have gone through the evidence on record. The fact that the insuree died of Epilepsy and that he had met earlier with an accident in which he had suffered a head injury are not in dispute. The latter fact is also confirmed by the claim filed by the insuree before the MACT where he himself has admitted that he suffered a fracture in the head in the accident causing loss of memory and understanding power because of which he was compelled to take treatment in a hospital and to incur huge expenses. On the other hand in the insurance proposal form which is before us, the insuree in response to a specific query whether he had suffered any accident or no, had replied No. He had also stated in the same form that he never consulted a medical practitioner for any treatment requiring more than a week. These are clearly false statement because as stated above, he had suffered a serious head injury and had also taken treatment for the same well before taking the insurance policy.
Regarding the nexus between Epilepsy and brain/head injury, it is medically well established that one of the most frequent causes of Epilepsy is head injury/trauma of the brain and this can occur either immediately or even much later (Source: Michael Kaplan, Chairperson, Brain Injury Association, Understanding Medical and Legal Aspects of Traumatic Brain Injury). Even though medical evidence to prove the nexus between the insurees injury and Epilepsy has not been p[roduced by Petitioner in the instant case, the contention of the State Commission that there can be no nexus is perhaps, medically speaking, not tenable. However, even if this aspect is not taken into account while deciding the case, we are of the view that it is very clear from the evidence on record that the insuree had suppressed material facts pertaining to his previous head injury and health. Admittedly, he suffered a head injury in an accident over 4 years prior to his having taken the insurance policy and it is not in dispute that in the relevant column, insuree had replied in the negative to the query whether he had any accident or injury etc. As stated earlier, it is well established that an insurance is a contract between two parties entered into in utmost good faith and breach of the terms and conditions of the same would entitle the Insurance Company to repudiate the claim. In the instant case, the insuree breached the terms and conditions of the insurance policy by suppressing material facts and therefore, Petitioner/Insurance Corporation was fully justified in repudiating the claim. The State Commission erred in not appreciating these facts and we therefore, have no option but to set aside the order of the State Commission. The Revision Petition is, therefore, allowed with no order as to costs.
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(ASHOK BHAN J.) PRESIDENT Sd/-
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(VINEETA RAI) MEMBER /sks/