State Consumer Disputes Redressal Commission
Life Insurance Corporation Of India vs Smt. Sushma Dilip Arole on 11 June, 2013
BEFORE THE HON'BLE STATE CONSUMER DISPUTES REDRESSAL
BEFORE THE HON'BLE STATE CONSUMER DISPUTES
REDRESSAL
COMMISSION, MAHARASHTRA, MUMBAI
First Appeal No. A/12/582
(Arisen out of Order Dated 24/02/2012 in Case
No. 89/2011 of District Pune)
1. LIFE INSURANCE
CORPORATION OF INDIA
COMMONWEALTH BUILDING,
LAXMI ROAD, SADASHIV PETH, PUNE - 411030
...........Appellant(s)
Versus
1. SMT. SUSHMA DILIP
AROLE
THROUGH SHRI PRASAN
DILIP AROLE,
BUILDING NO. 1 FLAT
NO. 6, LAKE VIEW PARK, SUTARWADI, PASHAN,
PUNE - 411021
...........Respondent(s)
BEFORE:
HON'BLE MR. Dhanraj
Khamatkar PRESIDING MEMBER
HON'BLE MR. Narendra
Kawde MEMBER
PRESENT:
A S VIDYARTHI,
Advocate for the Appellant
Mr.Prasanna Arole,
A/R
......for the
Respondent
ORDER
(Per Shri Narendra Kawde, Honble Presiding Member ) (1) This is an appeal filed by the original opponent Life Insurance Corporation of India (hereinafter referred to as appellant/opponent LIC) challenging dated 24/02/2012 in Consumer Complaint No.89/2011 (Sou.Sushma Dilip Arole vs. LIC of India) passed by District Consumer Disputes Redressal Forum, Pune. The District Forum while allowing the consumer complaint filed by present respondent/original complainant directed the appellant/opponent LIC to pay compensation of `25,000/- and additionally `1,000/- as costs of the litigation.
(2) Aggrieved thereby, this appeal has been preferred on the ground that no concluded contract was ever-reached between the parties as the proposal form was not accepted for issue of the policy, yet the District Forum erroneously allowed the consumer complaint with directions to pay compensation as narrated in para 1, supra. Moreover, as pleaded in the appeal memo, it is prerogative of the appellant/opponent LIC to issue or reject (depending on the nature of the case) the proposal submitted by the proposed life assured.
(3) Heard both the parties and perused the record placed before us.
(4) Admittedly, the respondent/complainant decided to subscribe to the Wealth Plus Police Plan
- Unit Link Insurance plan after reading press release issued by the appellant/opponent LIC. The complainant initially established contact with agent of the appellant/opponent LIC and submitted the proposal form as advised by the agent on 08/03/2010. The said proposal form was also verified by the medical practitioner of the appellant/opponent LIC and together with requisite documents submitted for the onward process. In the proposal form, the complainant disclosed the disease of diabetes against the query in para 6(e) of the proposal form. Additionally, the confidential report from the medical examiner was also obtained stating that the health of proposed life assured as good against the query in para 2(a) of the Confidential Report. The complainant also, as advised, submitted the pathological report of diabetes from Jeevandeep Medicare Centre. Not satisfied with the report, the appellant/opponent LIC decided to subject the proposed life assured for further medical examination which was carried out on 29/03/2010. It was found that operation of hysterectomy was carried in the year 1985 with the scar as healthy. There is no other deformity shown in the second medical examination report. Yet third time cardiogram was obtained by the opponent LIC with finding as normal and conclusion within normal limits. However, the complainant was suffering since last 9 year with diabetes were the observations made at the time of Electro Cardiogram. Further report of Dr.Girish Shah and medical confidential report of Dr.Sunita Ghule was also obtained by LIC. In the confidential medical report, it was observed against query No.13 as H/o T2 DM on R - 9 yrs. On obtaining several medical reports and confidential examination reports, LIC decided not to accept the proposal of the complainant and accordingly letter dtd. 23/11/2010 was issued to the complainant conveying the regret for not accepting the proposal. The complainant was aggrieved as no final decision was conveyed within the time after submission of original proposal in March 2010 and therefore filed consumer complaint which finally came to be decided holding deficiency against the appellant/opponent LIC.
(5) It was submitted during the course of arguments by the authorized representative of the respondent/complainant that the negative decision of the LIC was conveyed only in the month of October 2010 though the proposal form for Unit Linked Insurance Plan-Wealth Plus was submitted in the month of March 2010. Complainant was subjected to medical tests from time to time. However, as provided under Sub-regulation 5 of Regulation 4 of IRDA (Policy Holders Interest) Regulation, 2002, the LIC failed to process the proposal and convey their decision within 15 days as reasonable period. Learned advocate for the LIC submitted that the final confidential medical report of Dr.Smita Ghule was received only on 29/09/2010 with adverse findings about the health condition of the complainant. The final decision regretting non-acceptance of the complainants proposal was communicated on 23/11/2010. Be that as it may be, the fact remains the original proposal was submitted somewhere in the month of March 2010, the complainant was subjected to various repeated medical examination and finally the confidential medical report was obtained from the panel doctor in the month of September 2010. Till the receipt of confidential medical report, the proposal was process for under-writing according to the learned advocate. Yet decision of non-acceptance of the proposal could have been conveyed as early as possible under the Regulations relied by complainant within the reasonable period not existing 15 days. This shows that guidelines are followed more in breach than in observance as can be seen from the perusal of record. However, as rightly pleaded, it is prerogative of underwriters whether to accept or reject the proposal submitted by the proposed life assured. Since the proposed life assureds health was graded as sub-standard life, the LIC in it is own wisdom decided not to accept the proposal and finally conveyed the regrets in writing with option to the complainant for accepting alternative plan. The complainant did not respond to the offer of LIC for alternative plan and chosen to pursue the case of deficiency against the LIC in the District Forum. District Forum has ignored the process of issuing policy and underwriting process of insurance proposal and erroneously held deficiency in service against the LIC. Therefore, the order impugned is bad in law which deserves to be quashed and set aside. Hence, the order.
ORDER (1) Appeal is allowed.
(2) The impugned order dated 24/02/2012 passed in Consumer Complaint No.89/2011 by District Consumer Disputes Redressal Forum, Pune is quashed and set aside. Consumer Complaint No.89/2011 stands dismissed.
(3) No order as to costs.
Pronounced on 11th June, 2013.
[HON'BLE MR. Dhanraj Khamatkar] PRESIDING MEMBER [HON'BLE MR. Narendra Kawde] MEMBER pgg