State Consumer Disputes Redressal Commission
Mukesh Sharma & Ors. vs Icici Prudential Life Insurance Co Ltd & ... on 3 July, 2017
CHHATTISGARH STATE
CONSUMER DISPUTES REDRESSAL COMMISSION,
PANDRI, RAIPUR (C.G.)
Complaint Case No.CC/2017/02
Instituted on : 03.02.2017
1. Mukesh Sharma, S/o Shri Shyamlal Sharma,
Mahaveer Nagar, Atal Bihari Vajpai Ward No.38,
Chitrakote Road, Dharampura No.1, Near P.G.
Jagdalpur 494001 (C.G.)
2. Shyamlal Sharma, S/o Late Jwala Prasad Sharma,
Age 62 years, Caste Badhai
Vajpai Ward No.38, Chitrakote Road,
Dharampura No.1, Near P.G.
Jagdalpur 494001 (C.G.)
3. Smt. Ramkala Sharma,
W/o Shri Shyam Lal Sharma, Age 60 years,
Vajpai Ward No.38, Chitrakote Road,
Dharampura No.1, Near P.G.
Jagdalpur 494001 (C.G.) ... Complainants.
Vs.
1. I.C.I.C.I. Prudential Life Insurance Co. Ltd.,
Unit No.1A & 2A, Raheja Tipco Plaza,
Rani Sati Marg, Malad (East),
Mumbai 490 097
2. I.C.I.C.I. Prudential Life Insurance Co. Ltd.,
Through : Branch Manager,
Devendra Nagar Road, Sai Nagar,
Raipur (C.G.) .... Opposite Parties
PRESENT: -
HON'BLE SHRI JUSTICE R.S. SHARMA, PRESIDENT
HON'BLE SHRI D.K. PODDAR, MEMBER
HON'BLE SHRI NARENDRA GUPTA, MEMBER
COUNSEL FOR THE PARTIES:
Shri Rakesh Puri, Advocate for the complainant.
Shri Saurabh Shukla, Advocate for the opposite parties.
// 2 //
ORDER
Dated : 03/07/2017 PER :- HON'BLE SHRI JUSTICE R.S. SHARMA, PRESIDENT. The complainant filed this consumer complaint under Section 17 of the Consumer Protection Act, 1986 against the OPs seeking following reliefs :-
(1) To direct the OPs to pay the sum assured of Rs.50,00,000/-
(Rupees Fifty Lakhs) along with interest.
(2) To direct the OPs to pay the amount of Rs.5,00,000/-(Rupees Five Lakhs) for deficiency in service, unfair trade practice and mental harassment.
(3) The cost of the suit.
(4) Any other relief which the Hon'ble Commission deems fit and proper, may also be awarded.
2. Briefly stated the facts of the complaint of the complainants are that the complainant No.1 is son of complainant No.2 & 3 and the complainant No.2 & 3 are husband & wife. Ramdas Sharma has taken insurance policy for the sum assured of Rs.50,00,0000/-. The said policy was for 30 years and accordingly the premium of Rs.12,226/- was paid. The premium was yearly and date of commencement of policy was 28.10.2014 and last premium date was 28.10.2043. The OPs issued the policy to the deceased Ramdas Sharma, policy holder and Policy No.18943901 and the said policy was in non medical category.
// 3 // The proposal form was taken from policy holder and after verifying all the documents and details, the policy was issued. The policy holder Ramdas Sharma suddenly fell ill on 04.10.2015 and he was taken for the treatment at Ramkirshna Care Hospital, Raipur where the treatment was given to him and he was admitted upto 12.10.2015. The policy holder Ramdas Sharma expired in Ramkrishna Care Hospital, Raipur on 12.10.2015. The intimation was given to the Insurance Company and the documents were submitted with the Insurance Company, which they have demanded. The complainant has submitted all the documents of medical treatment and the documents which were demanded by the OPs. The OPs sent intimation to the complainant regarding repudiation of their claim on the ground that Life Assured has suppressed the material fact regarding his health condition. The complainants were shocked by receiving the said repudiation letter because no suppression was made by the deceased. The deceased has not suppressed any information regarding his health. The OPs by repudiating the claim of the complainant on wrong ground has committed deficiency in service. The OPs by repudiating the genuine claim of the complainant has committed unfair trade practice. The policy holder was not having knowledge regarding his disease, therefore, ground taken by the OPs for repudiation of the claim, is not correct. The complainants have requested the OPs to pay the claim amount, but the OPs have not paid // 4 // the claim amount, hence, the complainants have filed the instant complaint before this Commission.
3. The OPs have filed their written statement and averred that the complainants i.e. Shyamlal Sharma and Ramkala Sharma have no locus standi to file the present complaint as they are not nominee under the policy in dispute. The nominee under the Policy is Mukesh Sharma i.e. brother of the Life Assured. The complaint being frivolous and vexatious is liable to be dismissed under Section 26 of the Consumer Protection Act, as the complainants have failed to make out a case of deficiency of service as alleged or otherwise, within the meaning of The Consumer Protection Act, 1986, hence the present complaint is not maintainable. The Life Assured (LA) in his proposal form had suppressed information related to his health. The Insurance Company relied on the information provided by the Proposer / Life Assured in the proposal form. Since there were no adversities mentioned in the proposal form, the policy was issued under non- medical category i.e. without conducting any medical examination. In any case, it is a settled law that the medical examination is only for additional comfort and by any stretch of imagination it does not absolve the policyholder for making true and correct disclosures in the proposal form. Further there are certain ailments which cannot be determined by basic medical tests. On investigation, it was found that the life assured was suffering from a medical condition called // 5 // Hemophilia. Hemophilia A is a condition which occurs since birth. The Life Assured had undergone multiple blood transfusions, which is considered to be one of the treatment for Hemophilia patients. This history was suppressed by the Life Assured at the proposal and policy issuance stage. The policy was clearly obtained by fraudulent suppression of relevant material information. The fraudulent suppress of material facts related to health clearly shows the fraud played to the Insurance Company. The non-disclosure made by the Life Assured had a direct impact on his mortality and accordingly on the underwriting decision of the company. The complainants have admitted that the Life Assured was suffering from Hemophilia A since childhood. The complainants have themselves annexed with the complaint documents A-2, A-3 and A-4 i.e. the medical documents of M.P.M. Hospital, wherein it is clearly mentioned that the Life Assured was a case of Hemophilia since childhood. The complainants have also annexed document A-10 to A-13m the medical documents of Ramkrishna Care Hospital, wherein it is clearly mentioned that the Life Assured was a known case of Hemophilia A and he had history of multiple blood transfusion. The Life Assured availed the said policy through online channel and intentionally suppressed facts related to his health and medical condition. There is a deeper underlying fraudulent intent in the present case, as the Life Assured had not revealed about his health condition of Hemophilia A and multiple // 6 // blood transfusions, at the proposal stage. The Life Assured had projected himself to be a very healthy individual and deliberately and intentionally did not provide information relating to his health to the OPs, of which he had complete knowledge. The Life Assured who was projected to be a very healthy individual died within one year of issuance of the said policy. It is extremely surprising that the life assured underwent multiple blood transfusions, but the family of the Life Assured has no record of the same. The Life Assured was not taken to his family physician neither to the doctor who used treat him, but was taken to a new hospital M.P.M Hospital, in Jagdalpur, where he was under treatment of Dr. Vinay Kumar Kachhap, who then referred the life assured to higher centre for treatment and the Life Assured was taken to Ramkrishna Care Hospital, Raipur which is 284 kms away from Jagdalpur. The pertinent section of certificate from Dr. Vijay Kumar Kachhap shows that the Life Assured with full knowledge suppressed information related to his medical condition at the policy issuance stage. If the relevant information was disclosed at the policy issuance stage, the Insurance Company would not have issued the policy at all. Since the Life Assured did not perform his duty to disclose all material information, the contract of insurance between the OPs and the Life Assured is a void contract. On receiving the death claim within one year from the policy date, the OPs investigated the claim, which was within the legal framework. Under // 7 // the provisions of Section 45 of the Insurance Act, 1938, a Life Insurance Policy can be called in question on the ground of concealment of material facts if such facts were concealed fraudulently and that the policyholder knew at the time of making it that the statement was false. Since the claim falls in the category of early claim, it is duly investigated. During the verification, it was noticed that the life assured had not declared his true and correct health condition. Therefore, the OPs have rightly repudiated the claim raised by the complainant on the ground of suppression of material facts. As per the policy terms and conditions, in case of misrepresentation, the Insurance Company the right to cancel the policy. The OPs have rightly repudiated the claim. Therefore, the present complaint is devoid of any substance and is liable to be dismissed. The captioned complaint has been filed for Policy No.18943901. however the life assured had also taken one more policy from the Insurance Company bearing No.18943113 for which no complaint has been filed till date against the Insurance Company. The Insurance Company had received a dully filled online application form along with a duly signed CDF (Consumer Declaration Forum. This is an online platform through which OPs sales representative has the facility to assist the prospect to fill an online proposal form. The prospect also signs a physical CDF confirming the truthfulness and correctness of the details provided in the online proposal form and that any mis-statement or // 8 // suppression or non-disclosure of material information will lead to repudiation of the claim. Relying on the replies / declaration provided in the proposal for insurance, the proposal was accepted and policy was issued. The insured Ramdas Sharma was a Post Graduate and was an educated person. He had applied for policy after understanding all policy terms and conditions. If he was not agreeable to the term and conditions of the subject policy, he could have approached the OPs within the free look period but failed to do so which clearly implied that he was agreeable to the terms and conditions of the subject policy and that the policy was issued as per his satisfaction and requirements. It is pertinent to note that Insurance is a Contract of utmost good faith and that the Life Assured / Proposer being a party to the Contract is bound to disclose all material facts known to him at the time of proposal. Further the proposal form submitted by Life Assured had the declaration and authorization stating that in case of any mis-statement or suppression of material information, the Insurance Company has the right to repudiate the claim under the policy. The Insurance Company has received the claim intimation informing that the Life Assured expired on 12.10.2015 i.e., within a year of the policy issuance due to haemorrhagic shock with intra-abdominal bleeding being immediate cause of death and hemophilia being antecedent cause of death. The insured also gave his consent to the investigation by signing declaration in the claim // 9 // statement form. Since the claim falls under the category of early claim i.e. (within 2 years from policy issuance), the Insurance Company as per the procedure drawn by it, requested the complainants to submit additional documents required for claim processing and also appointed an investigator, to investigate about the genuineness of the said claim. The Insurance Company sent a letter dated 14.12.2015 to the complainants asking to submit additional documents. However, the complainants did not submit the medical records for last five years of the Life Assured. On investigation at claims stage, it has been noted that the life assured was suffering from Hemophilia A since childhood and was under treatment for the same. The above mentioned medical history is prior to the policy issuance. The Life Assured was suffering from Hemophilia and this fact was concealed and suppressed from the Insurance Company at the time of obtaining the said policy. This medical history is prior to proposing the said policy and was not disclosed to the insurer at the time of proposal. The OPs had approached Dr. C.H. Asrani, for his expert opinion. As per the expert opinion submitted by Dr. C.H. Asrani, it is categorically mentioned in the medical records that the Life Assured was suffering from Hemophilia A since childhood and had undergone multiple blood transfusions and hence it is evident that he had clear knowledge of his illness. The relevant questions from the proposal form is // 10 // reproduced below where the Life Assured did not disclose any health condition that he was suffering from :-
Q. No. Question Answer E Health Declaration
18. Do you have or have you ever had any disease No or disorder of the blood (like deep vein thrombosis (DVT), sickle cell, thalassemia major or intermediate thalasemia) and bleeding disorders, rheumatoid arthritis, systemic lupus erythematous (SLE) or any other auto immune or connective tissue disorders ?
If the above stated history would have been disclosed at the time of submission of the proposal form, the Insurance Company would not have issued the above mentioned policy at all. The Insurance Company has been deliberately misled to accept the proposal and issue the policy by suppression of material facts. The answer related to the health of the life assured i.e. Q No. E 18 has been found to be false. The contract of insurance is based on utmost good faith and the Life Assured cannot be absolved from his duty to provide material information to the Insurance Company about his health for the issuance of the policy. The Insurance Company, therefore, repudiated the death claim of the complainants on the basis of suppression of material facts and non-disclosure of material information and communicated its decision vide order dated 18.02.2016 repudiated the said claim and accordingly declared the contract / policy as void from // 11 // inception. The Life Assured had deliberately misled the Insurance Company to accept the proposal form by concealing material information about his pats medical history and furnishing false replies while filling up the proposal form, which were very essential for underwriting the proposal for the life insurance. The Insurance Company relied on and believed that the information given by the Life Assured in the proposal form was true and correct in all aspects. The Life Assured had not disclosed the full, complete and correct facts regarding his health. The Life Assured being a party to the insurance contract had a duty to adhere to the principle of "Uberrima Fide"
(utmost good faith) and make true and correct disclosures of all facts at the proposal stage. It was the solemn obligation and duty of the Life Assured to disclose true and correct information about his health in the proposal form. From the documents on record, it is evident that there is clear breach of the principle of utmost good faith by the Life Assured. The Insurance Company has rightly repudiated the claim of the complainants. The deceased life assured, despite being specifically asked about the material information, had not disclosed his details of previous ailments. Thus the life assured had deceived the Insurance Company into believing that he was a healthy individual and obtained life insurance policy by mis-representation Had the life assure disclosed his medical history at the proposal stage, the Insurance Company would not have issued the subject policy. The complainants // 12 // had concealed and suppressed the material and relevant facts of the case. The complainants are guilty of suggest vari suppresso falsi. The complaint therefore deserves no fate other than outright dismissal. The life assured fraudulently, dishonestly and by mis-representation obtained the policy on the basis of which the complainants are seeking claim. Since the policy is an outcome of fraud and mis- representation, therefore, the claim of the complainants is liable to be dismissed. The instant complaint before this Commission has been instituted by the complainants for undue gains with malicious intentions and to cause harassment to Insurance Company of high repute and stature. In view of deliberate and malafide concealment of material facts, the said policy has been treated as void and thus any claim arising therefrom, is not tenable and that the Insurance Company is not liable to pay any amount of whatsoever nature to the complainants. The life assured died on 12.10.2015 and that the death claim intimation was received by the Insurance Company. Vide letter dated 14.12.2015, the OPs called for additional documents, related to Life Assured's health. The complainants did not provide any earlier medical records for 5 years before life assured's death. The Insurance Company conducted investigation under Section 45 of the Insurance Act, 1938 and it was revealed that the life assured had pre-existing disease of Hemophilia A and he had done multiple blood transfusion. This was a material fact which was important for the OPs in deciding if // 13 // a policy should be issued to the proposer. Hence the claim was rightly repudiated for suppression and mis-representation of facts. The life assured was a known case of Hemophilia A since childhood. The life assured and his family members right from childhood knew that he was suffering from Hemophilia. The Insurance Company was deceived into providing risk cover, to the life assured, and was denied a fair chance to assess the risk on life of life assured. Had the correct details of the health of the life assured were provided, the sad policy would not have been issued at all. Due to fraudulent suppress and mis-representation of important material fact, the contract between life assured and OPs is invalid, void-ab-initio, inoperative and unenforceable, hence the complainants are not entitled to receive any benefit under the said policy. The present complaint is nothing but a fraud played to the OPs. The exorbitant amount of damages claimed show very clearly the complainants' intention to ruse monies from the OPs. There has been no deficiency in service on the part of the OPs. The complaint is devoid of any substance and is liable to be dismissed.
4. The complainants filed documents. Document A-1 is copy of insurance policy, document A-2 is Doctor's Order / Admission Card, document A-3 is Discharge Note issued by M.P.M. Hospital, Jagdalpur, document A-4 is clinical laboratory report, document A-5 is Medical Certificate of Cause of Death, document A-6 is Death Certificate of Ramdas Sharma, document A-7 is Certificate of Hospital // 14 // Treatment, document A-8 is Medical Attendant's Certificate, document A-9 is Certificate issued by M.P.M. Hospital, Jagdalpur, document A- 10 is Registration Data of Ramkrishna Care Hospital, document A-11 are Clinical Pathology Report dated 04.10.2015 issued by Ramkrishna Care Hospital, document A-12 is Inpatient Final Bill Summary (Duplicate), document A-13 is clinical notes of Ramkirshna Care Hospitals etc. document A-14 is letter dated 18.02.2016 by the OPs to Mr. Mukesh Sharma.
5. The OPs have filed documents. Annexure 1 is Proposal Form, Annexure 2 is Certificate under Section 65-B of Evidence Act, 1872, Annexure 3 is Certificate of Insurance, Annexure 4 is Claimant Statement Form (Death Claims), Annexure 5 is letter dated 14.12.2015 sent by the OPs to Mr. Mukesh Sharma, Annexure 6 is Doctor's Order / Admission Chart etc. Annexure 7 is Certificate issued by M.P.M. Hospital, Jagdalpaur, Annexure 8 is discharge note, Annexure 9 is Registration Data of Ramkrishna Care Hospitals, Annexure 10 is Investigator's report, Annexure 11 is Medical Attendant's / Hospital Certificate. The OPs have filed affidavit of Dr. C.H.Asrani and his opinion.
6. Shri Rakesh Puri, learned counsel appearing for the complainants have argued that late Ramdas Sharma, obtained insurance policy from the OPs for 30 years for sum assured // 15 // Rs.50,00,000/-. The annual premium of Rs.12,226/- was paid to the OPs. The date of commencement of the policy was 28.10.2014 and the last premium date was 28.10.2043. The insurance policy was issued in favour of Ramdas Sharma. The policy was in non-medical category. The proposal form was taken from the policy holder and after verifying all the documents and details, the insurance policy was issued. On 04.10.2015, Ramdas Sharma suddenly fell ill and he was taken for the treatment at Ramkrishna Care Hospital, Raipur where he was admitted till 12.10.2015 and he expired on 12.10.2015. The intimation regarding death of Ramdas Sharma was given to the OPs and all the documents were submitted to the OPs, but the OPs did not settle the claim of the complainants and repudiated the claim of the complainant and thus committed deficiency in service, therefore, the complainants are entitled for the reliefs as prayed by them in the relief clause of the complaint.
7. Shri Saurabh Shukla, learned counsel appearing for the OPs has argued that the complainant No.2 and complainant No.3 have no locus standi to file the instant complaint as they are not nominee of deceased Ramdas Sharma, therefore, the complaint is liable to be dismissed. He further argued that deceased insured Ramdas Sharma was suffering from Hemophilia since childhood, but in the proposal form he had not mentioned regarding his health condition and suppressed the material facts, therefore, the OPs have rightly // 16 // repudiated the claim of the complainants. The complaint of the complainants be dismissed.
8. We have heard learned counsel appearing for both the parties and perused the documents filed by the parties in the complaint case.
9. The complainants have not specifically pleaded that what relationship they have with the deceased Ramdas Sharma. In para 3 of the complaint they simply pleaded that the complainant No.2 & 3 and brother of complainant No.1,. has taken one policy from the OPs, but the complainants have not pleaded regarding their relationship with deceased Ramdas Sharma. In the proposal form, the marital status of deceased Ramdas Sharma, is mentioned "unmarried" and his father's name is mentioned Shyamlal Sharma. Document A-1 is Insurance Policy. In the insurance policy the date of birth of Ramdas Sharma is mentioned 16.10.1982 and his age is mentioned 32 years. In the insurance policy, the name of nominee is mentioned Mukesh Sharma (complainant No.1). Mukesh Sharma (complainant No.1) is nominee of the deceased Ramdas Sharma, in the insurance policy and Shyamlal Sharma (complainant No.2) and Smt. Ramkala Sharma (complainant No.3) are respectively father and mother of deceased Ramdas Sharma. The complainant No.1 is nominee in the policy and complainant No.2 and 3 are father and mother of deceased life assured, therefore, they are also beneficiary. They are also consumers of the OPs and they are competent to file instant complaint under // 17 // Section 17 of the Consumer Protection Act, 1986 against the OPs , therefore, the complaint is maintainable.
10. The main objection raised by the OPs is that the deceased insured Ramdas Sharma was suffering from Hemophilia since childhood.
11 In Loyal's Medical Dictionary by Dr. Sri Nandan Bansal published by International Publishing House, "Hemophilia is defined as "A hereditary hemorrhagic disease in which blood fails to clot due to deficiency of a blood coagulation factor and abnormal bleeding occurs with swelling of the joints.
12. The OPs have filed copy of insurance policy along with terms and conditions of the policy and proposal form filled up by the deceased Ramdas Sharma. At Sl. No.18 of the proposal form under the head E "Health Declaration", it is mentioned thus :-
18. Do you have or have you ever had any disease or No. disorder of the blood (like deep vein thrombosis (DVT), sickle cell, thalassemia major or intermediate thalassemia) and bleeding disorders, rheumatoid arthritis, systemic lupus erythematosus (SLE) or any other auto immune or connective tissue disorders.
13. The complainants have not filed copy of any declaration. The OPs have filed investigation report dated 05.01.2016 given by Investigation Services, against the column marital status, "unmarried"
is mention and against the column of nominee name of Mukesh // 18 // Sharma is mentioned and in the column of age and relation with L.A. "29 years and brother" is mentioned. In the Investigation Report, it is also mentioned that "Investigator met with the family doctor of LA and enquired from him about insured illness so he told that LA was suffering from haemophilia but he did not have any medical record available with him". It is also mentioned under the head list of documents and photographs collected - Medical documents from Ramkrishna Hospital, Medical documents from MPM Hospital and MAC filled by doctors.
14. The OPs have filed affidavit of Dr. CH Asrani, in which it is mentioned thus :-
"Opinion required :
1. What is haemophilia A and what causes Hemophilia A?
As explained with suitable references above, Hemophila A is a genetic X-linked, recessive disorder caused by deficiency of functional plasma clotting factor VIII (FVIII) and is presence since birth.
2. Was the LA suffering from Hemophila or Hemophilia A?
From documents available, it can be opined that LA was suffering from Hemophilia A.
3. What is the difference between Hemophilia and Hemophilia A ?
Hemophilia is the umbrella term under which are both Hemophilia A and Hemophila B. Hemophila A is type of Hemophilia.
// 19 //
4. Is there a non - disclosure ?
Yes, As established from various medical documents available, the patient was suffering from Hemophilia A at the time of taking the policy (RCD 28/10/2014). As explained with suitable references above, Hemophila A is an inherited disorder, which is presence since birth. The patient was well aware of his condition before taking the policy as he had been on regular blood transfusions (taken as treatment for Hemophilia A) as per medical documents available and the fact that he chose not to disclose it at the time of taking the policy is a non-disclosure of a material fact.
The sequence of events in this case will be Patient a known case of Hemophilia A (present since birth with deficiency of clotting factor VII) prone to bleeding episodes - develops large retroperitoneal hematoma - hospitalized and Left lumbar inter segmental artery embolisation done - starts bleeding from femoral sheath - bleeding cannot be controlled due to underlying bleeding disorder - hemorrhagic shock - death.
5. If yes, is this non -disclosure significant ?
Yes! As explained with suitable references above, Hemophilia A is an inherited disorder, which is present since birth, and the patient had been on regular blood transfusions for its treatment. Had this fact been disclosed at the time of taking the policy, it would have lead to a very different underwriting decision.
6. Does Hemophilia occurs only since birth or can it also happen at a later stage ?
// 20 // As referenced above, Hemophilia is an inherited disorder, which occur due to faulty genes being transferred to fetus; inherited disorder occur since birth and cannot occur at later stage.
Conclusion : Mr. Ramdas Sharma was a known case of Hemophila A, which is a genetic X-linked, recessive disorder caused by deficiency of functional plasma clotting factor VIII (FVIII) and is present since brth. He chose to intentionally not disclose its existence at the time of taking the policy (RCD 28/10/2014) and this is a significant non- disclosure."
15. In Revision Petition No.2877 of 2013 - M/s. Aviva Life Insurance Company India Pvt. Ltd. vs. Smt. Phool Kunwar, vide order dated 04.08.2015, Hon'ble National Commission, has observed thus :-
"15. As apparent from the record of Apollo Hospital, the deceased was suffering from diabetes mellitus and hypertension for last two years prior to his death. So, it stands clearly proved that deceased life assured had concealed and suppressed material facts at the time of obtaining the insurance policy.
16. In this regard, observations made by Hon'ble Supreme Court in "Satwant Kaur Sandhu Vs. New India Assurance Company Ltd. (2009) 8 SCC 316" which are quite relevant to the present case, are quoted as under :-
"Thus, when an information on a specific aspect is asked for in the proposal form, an assured is under a solemn obligation to make a true and full disclosure of the information on the subject which is within his knowledge. It is not for the proposer to determine whether the information sought for is material for the purpose of the policy or not. Of course, // 21 // obligation to disclose extends only to facts which are known to the applicant and not to what he ought to have known. The obligation to disclose necessarily depends upon the knowledge one possesses. His opinion of the materiality of that knowledge is of no moment."
In para 29 of Satwant Kaur Sandhu's case (Supra), the Hon'ble Apex Court has held that :
"29. Judged from any angle, we have no hesitation in coming to the conclusion that the statement made by the insured in the proposal form as to the state of his health was probably untrue to his knowledge. There was clear suppression of material facts in regard to the health of the insured and, therefore, the respondent - insurer was fully justified in repudiating the insurance contract. We do not find any substance in the contention of learned counsel for the appellant that reliance could not be placed on the certificate obtained by the respondent from the hospital, where the insured was treated.
17. This Commission in Life Insurance Corporation of India Vs. Smt. Minu Kalita, R.P. No.1167 of 1997 decided on 19.03.2012" has held that :-
"It is settled law that the contract of insurance is based on good faith. The information as to the insured having suffered from Cancer before the policy was taken and the hospitalization for the same came to light afterwards and the petitioner is not to know this by an examination of their medical officer. It is for the respondent to give the correct information on his health which he did not disclose at that time. This ground of incorrect information and false statements regarding age of the insured and income make the insurance contract null and void. We find there is no deficiency of service by the petitioner Life Insurance Corporation of India. Both the District Forum and the State Commission have not appreciated the facts brought out by the petitioner in repudiating the claim."
// 22 //
16. In Gurmeet Kaur @ Meeto & Anr. vs. Life Insurance Corporation of India, III (2015) CPJ 246 (NC), Hon'ble National Commission has observed that "Deceased had been suffering from diabetes for the last 14-15 years and suffered from chronic renal failure for last 4-5 years. No evidence on record to prove that information given by Doctor regarding health status of insured was incorrect. Violation of conditions of policy established. Repudiation justified."
17. In Life Insurance Corporation of India v. Shahida Khatoon & Anr., IV (2013) CPJ 370 (NC), Hon'ble National Commission observed thus :-
"12. We have relied upon several judgments of Hon'ble Supreme Court in cases Satwant Kaur Sandhu v. New India Assurance Co. Ltd., IV (2009) CPJ 8 (SC) = VI (2009) SLT 338 = (2009) 8 SCC 316, P.C. Chacko and Anr. v. Chairman, LIC of India, III (2008) CPJ 78 (SC) = IX (2007) SLT 533 = IV (2007) ACC 773 (SC) = (2008) 1 SCC 321, LIC of India v. Smt. Asha Goel, I (2001) SLT 89 = (2001) 2 SCC 160, have discussed the term "Material Fact" as fact which goes to the root of the contract of insurance and has a bearing on the risk involved would be material. The term material fact is not defined in the Act and, therefore, it has been understood and explained in general terms to mean as any fact which influence the judgment of a prudent insurer in fixing the premium or determine whether he would like to accept the risk.
13. Therefore, we do not find any force in the arguments of Counsel for complainant/respondent. Both the Fora below have erred in not considering the non-disclosure of material facts by the deceased and // 23 // filled the proposal form. Accordingly, we set aside the orders passed by Fora below and allow this revision petition by dismissing the complaint.
No order as to cost".
18. In L.I.C. of India v. Pratima Mishra, IV (2013) CPJ 161 (Chha.), this Commission observed thus :-
"8. Even if we presume that the deceased was required to notify anything to the Insurance Corporation as per terms and conditions of the acceptance, as per printed material available in the bottom of receipt of deposit of premium, even then requirement was only this that if there is any change in the occupation of the insured, then it was required to be notified and if there is any adverse circumstances connected with financial position or the general health of the proposer or that of any members of his family then if that circumstance may be very much unimportant, but the same if occurred between the date of proposal and date of this receipt or if on a proposal for assurance or an application for revival of a policy on the life made to any office of the Corporation, then it was required to be notified. Thus, what was required to be notified was any change in the occupation of the insured or any adverse circumstances affecting the insured or his family members. If deceased insured suffered a road accident, but immediately after treatment it was found that he was not having any bony injury. When no adverse circumstances relating to his health was stated by any of the doctors to the deceased insured, then it was not required for him to notify anything to the Insurance Corporation. Even in the receipt, which was obtained by the deceased after deposit of the premium, only such terms and conditions were printed.
9. Documents in respect of treatment of deceased insured, which have been brought on record by the appellant before the District Forum are photocopies of the treatment of the deceased insured in Ramkrishna // 24 // Care Hospital, Raipur as well as Chandulal Chandrakar Memorial Hospital, Bhilai. From these documents, it appears that as per noting of Ramkrishna Care Hospital, Raiapur on C.T. Scan, it was found that there was no bony injury and all four limbs could be raised by him. Pupil of both eyes were normal. Thus, nothing substantial was noted by the Hospital for which it can be said that it was a circumstance which had adversely affected the health of the insured and was required to be notified by him to the Insurance Corporation. Later on he was treated with Chandulal Chandrakar Memorial Hospital, Bhilai from 15.03.2008, where ultimately he died on 16.03.2008. Thus, from record of the treatment given in Ramkrishna Care Hospital, it appears that it is not containing any such information which can be said to be relating to circumstance adversely affected the health of the deceased insured and was required to be notified by him to the Insurance Corporation."
19. In L.I.C. of India v. MU Jakia, IV (2013) CPJ 129 (NC), Hon'ble National Commission observed thus :-
"15. It is an undisputed fact that Shri Akhil Khan the deceased had taken LIC policy from the respondent for a sum of Rs.51,000/- on 1.1.2004. It is also an admitted fact that as per the bed head ticket of Maharana Bhopal Hospital, Udaipur the deceased was admitted to the hospital on 3.6.2003 for the treatment of chronic renal failure, hypertension, septicaemia, nephritis and was discharged from the hospital on 6.6.2003. While the State Commission has correctly come to the conclusion that the petitioner were justified in repudiating the claim of the respondents on the ground of suppression of material fact regarding health and that the finding of the District Forum rejecting the claim of the respondents were based on correct appreciation of entire material evidence available on record and they do not suffer // 25 // from any basic infirmity or illegality or perversity and hence, no interference is called for with the same and appeal was dismissed. The State Commission erroneously went on to award an ex gratia payment on humanitarian consideration of Rs.15,000/-. This is beyond the pleadings of the respondents. Further, in P.C. Chacko and Anr. v. Chairman Life Insurance Corportion of India and Ors., IV (2007) ACC 773 (SC) = IV (2007) CLT 229 (SC) = IX (2007) SLT 533 = III (2008) CPJ 78 (SC) = 2007 XAD (SC) 429, in which paragraph 20 which is relevant to us in this case reads as under :
"We are not unmindful of the fact that Life Insurance Corporation being a state within the meaning of Article 12 of the Constitution of India, its action must be fair, just and equitable but the same would not mean that it shall be asked to make a charity of public money, although the contract of insurance is found to be vitiated by reasons of an act of the insured. This is not a case where the contract of insurance or a clause thereof is unreasonable, unfair or irrational which could make the Court carried the bargaining powers of the contracting parties. It is also not the case of the appellants that in framing the aforesaid questionnaire in the application/proposal form, the respondents had acted unjustifiably or the conditions imposed are unconstitutional."[See also Life Insurance Corporation of India & Anr. v. Vinod Devi, IV (2013) CPJ 142 (NC)].
16. The National Commission in RP Nos. 858, 894, 995, 1435, 1446, 1503, 1504, 1505, 1553, 1554, 1679, 1680, 1722, 1723, 3631 of 2009, 1504 of 2006, 3147, 3789, 3855, 3858 to 3860, 3917, 3918, 4662, 4663, 4726, 4727, 4836, 4837, 5009, 5010, 5030 of 2008, 23, 164, 331, 359, 1909, 1926, 2945, 2946, 3094, 3097 of 2009 decided on 17.12.2009 have stated as under :-
// 26 // "We are afraid in terms of provisions of Consumer Protection Act 1986, we are not free to do a 'favour' to a party. As, far as the moral obligation is concerned, that has to be done 'voluntarily' by the authority concerned. The Consumer Fora cannot pass or give direction or order to give a 'favour' otherwise the word more grounds are voluntarily will lose its very meaning.
While going through the aim and objectives of the Consumer Protection Act, 1986, as highlighted by the learned Counsel for the respondent we are of the view that a distinction needs to be made between justice - natural or otherwise and 'favour'. There is no room for favouritism while dispensing justice. The word ' ex gratia' has been interpreted / understood to mean favour', rendered 'voluntarily' and on 'moral grounds', thus, clearly ousting the jurisdiction of quasi-judicial bodies like ours to direct a party to show favour. If we do this, this will not only run counter to the letter and spirit of Consumer Protection Act but also assume / confer powers which are not conferred upon us by Law / mandate. Any direction by Consumer Fora to the party concerned to grant ex gratia payment will defeat the very purpose and meaning of 'ex gratia', i.e., favour, grace shown voluntarily on moral grounds.
However, this order would not deter directing payment of ex gratia' basis by the Consumer Forums, provided, the concurrence of the sanctioning authority of insurance company, is obtained through their Counsel (Counsel for the Insurance Company) for making the payment on 'ex gratia' basis."
// 27 //
20. The complainants have filed Discharge Note issued by M.P.M. Hospital, Jagdalpur, which is marked as document A-3 in which it was diagnosis "intrapoeritoned bleed, Haemophelia, S. Anemia."
21. In document A-5 which is Medical Certificate of Cause of Death, the cause of death of Ramdas Sharma is mentioned "Haemorragic Shock"
22. In document A-9 which is Certificate issued by Dr. Vinay Kumar Kachhap, Physician, M.P.M. Hospital, Jagdalpur (C.G.), it is mentioned that "This is to certify that late Ramdas Sharma, S/o Shri Shyamlal Sharma, aged around 33 years, Resident of Mahaveer Nagar, Atal Bihari Vajpai Ward, Chitrakote Road, Jagdalpur (C.G.) was known case of Hemophilia since childhood and did Multiple Blood Transfusion." The complainants have also filed medical records of Ramkrishna Care Hospital, Raipur in which it is also mentioned that Ramdas Sharma was suffering from Hemophilia intra abdominal bleed.
23. Looking to the medical reports of the deceased and opinion given by Dr. C.H. Asrani, it appears that the deceased insured was suffering from Hemophilia since childhood, but he did not disclose regarding the above disease at the time of making proposal for the insurance.
// 28 //
24. The OPs have filed terms and conditions and copy of the proposal form, in which health condition is essentially required to be disclosed. Looking to the above documents, it appears that health condition is essential to be disclosed in the proposal form before obtaining insurance policy, but the Life Assured did not disclosed the above facts while making proposal statement and has violated the terms and conditions of the insurance policy, and suppressed the material facts, therefore, the OPs have rightly disallowed the claim of the complainants. The complainants are not entitled for insurable benefit under the insurance policy, therefore, the complainants are also not entitled to get any amount from the OPs under the insurance policy.
25. On the basis of above discussions, the complaint filed by the complainant against OPs, is liable to be dismissed, hence the same is dismissed. Parties shall bear their own costs.
(Justice R.S. Sharma) (D.K. Poddar) (Narendra Gupta)
President Member Member
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