State Consumer Disputes Redressal Commission
Life Insurance Corporation Of India vs Smt. Vidya Devi on 6 April, 2010
STATE CONSUMER DISPUTES REDRESSAL COMMISSION UTTARAKHAND
DEHRA DUN
FIRST APPEAL NO. 306 / 2007
Life Insurance Corporation of India
having one of its Divisional Office at
Jeevan Prakash Building, Haridwar Road
Dehradun through its Authorised Signatory
...... Appellant / Opposite Party
Versus
Smt. Vidya Devi W/o late Sh. Sukhram
R/o Nai Basti, Indira Colony
Dehradun
......Respondent / Complainant
Sh. T.S. Bindra, Learned Counsel for the Appellant
Sh. J.P. Kansal, Learned Counsel for Respondent
Coram: Hon'ble Justice Irshad Hussain, President
C.C. Pant, Member
Smt. Kusum Lata Sharma, Member
Dated: 06/04/2010
ORDER
(Per: Justice Irshad Hussain, President):
Insurer filed this appeal against the order dated 17.08.2007 passed by the District Forum, Dehradun, allowing consumer complaint No. 100 of 2004, so as to award assured sum of Rs. 1,00,000/- each against the two insurance policies with interest to the nominee - complainant, by rejecting the contention of the insurer that at the time of making proposals to purchase insurance policies, the insured late Sh. Sukhram had not acted in good faith and suppressed information about his ailments with which he was then suffering and went on to purchase two insurance policies of Rs. 1,00,000/- each. Claim under the policies, after the death of the insured on 03.11.2000, was repudiated on the said ground, regarding which the District Forum accepted the complainant's plea that the 2 insurer made deficiency in service in repudiating the claim by communication dated 27.03.2002. Complaint was thereafter filed on 16.07.2004, which was allowed as aforesaid by the order impugned.
2. We have heard the learned counsel for the parties and have considered their submissions in the light of the facts, circumstances and legal aspects of the case. Proposals for the insurance policies were made on 29.02.2000 and the insured late Sh. Sukhram died on 03.11.2000 in the ONGC Hospital, where he had been admitted for treatment of disease on account of his being an employee of the ONGC. In the proposal form, the insured gave answers to the relevant questions as under:
Question Answer 11(a) During the last five years did you consult No
a Medical Practitioner for any ailment requiring treatment for more than a week?
(c) Have you remained absent from place of No work on grounds of health during the last 5 years? (d) Are you suffering from or have you ever No suffered from ailments pertaining to Liver, Stomach, Heart, Lungs, Kidney, Brain or Nervous system? (i) What has been your usual state of health? Good
3. Referring to the above answers to the questions, the claim was repudiated on the ground that the insured had been suffering from cirrhosis of liver for more than three years, for which he had consulted a medical man and that the insured, however, did not disclose these facts in his proposals and gave false answers therein, as stated above.
34. Learned counsel for the insurance company persuasively urged that the certificate of hospital treatment as well as medical attendant's certificate (Paper Nos. 41 and 42), duly issued by the Medical Superintendent of ONGC Hospital, Dehradun, prove that the insured had not acted in good faith while entering into contract of insurance and suppressed the fact of his suffering from cirrhosis of liver from before the purchase of the insurance policies. According to the learned counsel, the District Forum fell in error in not properly taking into consideration the probative value of the endorsements made in these certificates, which fully justify that the claim deserve to be repudiated on the ground mentioned in the claim repudiation letter and as referred above. On the other hand, learned counsel for the complainant supported the finding of the District Forum, by submitting that the endorsements made in the certificates relied upon by the insurance company regarding the ailments with which the insured was shown to have been suffering from before taking the insurance policies, have not been proved by any admissible evidence of the medical practitioners, who may have treated the insured; any record of hospitalization of the insured pertaining to his treatment after admission in the hospital and any record of the leave, either medical or otherwise availed for admission in any hospital for treatment of any disease prior to taking the insurance policies. The learned counsel, therefore, urged that the insurance company had no justification to repudiate the claim and the District Forum has rightly held that the deficiency in service has been made by the insurance company in repudiating the claim.
5. Considering the totality of the circumstances of the case, we see merit in the submission of the learned counsel for the complainant rather than the argument advanced on behalf of the insurance company and record our decision that the order impugned regarding 4 award of assured sum under the policies to the complainant, is fit to be upheld.
6. The reasons for the aforesaid decision are that the proposals were made for taking the insurance policies in the month of February, 2000 and whereas the insured died due to illness on 03.11.2000 after he remained admitted in the hospital for a period of about 20 days, as is evident from the certificate of hospital treatment referred above. The endorsement in this certificate indicate that the disease of the insured diagnosed was cirrhosis of liver and hepatic encephalopathy. Medical attendant's certificate further describe that primary cause of death of the insured was hepatic encephalopathy and secondary cause was cardio respiratory failure and the insured was suffering from this disease approximately four weeks from before his death. It further describe that the symptoms of the disease were observed about six weeks back and further that the insured remained intermittently under treatment for the previous six months. This would indicate that the insured started taking treatment of any disease few months after purchasing the policies and there is no evidence on record to indicate that at the time of purchasing the policies, the insured knew that he was suffering from any disease of liver, as referred thereto in the certificate. Even otherwise, had the insured been suffering from liver disease for long, he would have availed leave from his job for medical treatment by getting himself admitted in the hospital from time to time, but there was nothing on record as may have indicated that the insured took leave and remained hospitalized for treatment of disease of liver during the period of six months prior to his death. Under these circumstances, endorsement in the medical attendant's certificate that the insured was suffering from cirrhosis of liver for a period of more than three years prior to his death, can not safely be said to have been supported by any admissible 5 evidence, either of the doctor, who treated him or hospital record of his taking treatment for such a long period for any disease of liver referred to as cirrhosis of liver with hepatic encephalopathy. In other words, the insurance company has not been able to produce any cogent evidence as may have unfolded the suppression of fact of the insured suffering from cirrhosis of liver at the time of making the proposal for purchase of the insurance policies and also knowing it very well that he has been suffering from such disease at that time.
7. Considering the totality of the circumstances of the case and the material on record, we are convinced that the insurance company has failed to discharge the burden of proving that the insured suppressed material fact as regards his ailment and gave wrong answers to the relevant questions in the proposal forms submitted for purchase of the insurance policies. It shall not be out of place to mention that at the time of submission of the proposal forms, the insured was thoroughly examined by the panel doctor of the insurance company and the insured was reported to be medically fit not suffering from any serious disease. Under these circumstances, we are convinced that the District Forum was fully justified in rejecting the contention of the insurance company and rightly held that the insurance company made deficiency in service in repudiating the complainant's claim and rightly went on to award the assured sum under the policies to the complainant by the order impugned.
8. It was also submitted by the learned counsel for the insurance company that the interest awarded @9% p.a. was on the higher side, in view of the fact that no court is granting interest at the rate of more than 7% p.a. these days. We agree with the submission because we have also, in number of cases, awarded interest @7% p.a. only. To that extent, the appeal succeed.
69. Appeal is partly allowed. Order impugned dated 17.08.2007 of the District Forum is modified to the extent that the rate of interest is reduced from 9% p.a. to 7% p.a. Rest of the order of the District Forum is maintained. No order as to costs.
(SMT. KUSUM LATA SHARMA) (C.C. PANT) (JUSTICE IRSHAD HUSSAIN) K