State Consumer Disputes Redressal Commission
Life Insurance Corporation Of India, vs Smt.Chhaya Hanmayya Ghante, on 4 December, 2008
1 F.A.No.:695/04
Date of filing :20.04.2004
Date of order :04.12.2008
MAHARASHTRA STATE CONSUMER DISPUTE REDRESSAL
COMMISSION,MUMBAI, CIRCUIT BENCH AT AURANGABAD.
FIRST APPEAL NO. :695 OF 2004
IN CONSUMER COMPLAINT NO.:81 OF 2003
DISTRICT CONSUMER FORUM :PARBHANI & HINGOLI.
Life Insurance Corporation Of India,
Branch no.986(Jalna B.O.),
Parbhani,
Through its Zonal Manager,
Western Zonal Office,
Yogakshema,
Mumbai 400 021. ...APPELLANT
(Org.Opponent)
VERSUS
Smt.Chhaya Hanmayya Ghante,
R/o Kalyan Nagar,
Parbhani. ...RESPONDENT
(Org.Complainant)
CORAM : Shri.S.G.Deshmukh, Hon`ble Presiding Judicial Member.
Mrs.Uma S.Bora, Hon`ble Member.
Present : Adv.Shri.S.R.Malani for appellant, Adv.Shri.P.N.Kalani for respondent.
O R A L O R D E R Per Mrs.Uma S.Bora, Hon`ble Member. 1. Life Insurance Corporation of India, Branch Parbhani
challenges in this appeal order passed by District Forum, Parbhani & Hingoli in complaint case No.81/03 decided on 27.2.2004. By this order, Forum directed L.I.C. to pay Rs.1,00,000/- with interest @ 6% from 23.9.2001 till realisation of the amount.
2. The facts of the case are as under.
2 F.A.No.:695/04Complainant Chhaya Hanmayya Ghante is the wife of deceased life assured. Life assured Dr.H.C.Ghante obtained insurance policy on 29.3.1999 for sum assured of Rs.1,00,000/-. Policy number is 982866312. Life assured died on 23.9.2001. Complainant being nominee filed the claim with the insurance company which was repudiated on 20.01.2003. The ground for repudiation is suppression of material fact about the health of life assured. Life assured died because of Jaundice. As the claim was repudiated by L.I.C. Complainant approached the District Forum and demanded insurance amount with Rs.10,000/- for compensation.
3. Insurance Company appeared before the Forum and resisted the claim. It is submitted by L.I.C. that life assured was suffering from fibrosis alveolitis before taking policy. Due to suffering of said disease he was on leave from 4.12.97 to 26.2.1998. He was taking treatment at Government Hospital, Parbhani. This fact was suppressed by life assured while taking the policy. Therefore the claim was repudiated rightly.
4. After hearing both the parties the District Forum allowed the complaint.
5. Being aggrieved by the judgment and order passed by District Forum, Parbhani & Hingoli, L.I.C. came in appeal.
6. Notices of final hearing of appeal were issued to both the parties. Adv.Shri.S.R.Malani appeared on behalf of appellant.Adv.Shri.P.N.Kalani appeared on behalf of respondent. We heard both the counsels at sufficient length. Adv.Shri.Malani submitted that, medical certificate was produced on record which clearly mentions that, life assured was taking treatment for fibrosis alveolitis and pulmonary infection from 18.2.1998 to 20.2.1998. One more certificate is also on record which mentions that life 3 F.A.No.:695/04 assured was taking treatment from 4.12.1997 to 17.2.1998. This clearly shows that life assured was admitted in the hospital on medical ground. This fact was suppressed by life assured while taking policy. He submitted that, the contract of insurance is based on good faith. Therefore it is obligatory on the part of life assured to provide true information. Leave record of life assured was produced before Forum which shows that, he had obtained leave from 21.5.2000 to 21.8.2000 and 1.11.2000 to 30.11.2000. Life assured was in medical profession. Therefore he has knowledge of his illness even then he suppressed said fact while taking policy.
7. In support of his argument he relied on the ratio in National Commission in ' Panni Devi -Vs- LIC of India' reported in Legal Digest, January 2004 in which it is held that suppression of material fact at the time of taking policy-the doctor records what the insured tells-doctor would not know unless it is visible-petition dismissed. This authority is not helpful to the present case as the ailment from which life assured was suffering was not existing at the time of taking policy.
He also relied on the ratio in 'Avtar Singh -Vs- Life Insurance Corporation of India' reported in Legal Digest, July 2007, in which it is held that, the claim had been rightly repudiated as the appellant/life assured had misrepresented the facts in the proposal form and there is no deficiency on the part of respondents. This authority is also not helpful to the present case as in the reported case deceased was admitted in the hospital after bone marrow immediately before taking policy and was absent for 22 days from the school.
He also relied on the ratio in 'L.I.C. -Vs- Raksha Goyal' reported in Legal Digest, April 2002, it is held that, repudiation of life insurance policy-compassion that a concern for the sufferings or misfortune of the complainant is one thing but that cannot overturn the law'. In the present case there is no question of compassion.
4 F.A.No.:695/048. Adv.Shri.Kalani submitted that, life assured was suffering from fibrosis alveolitis in the year 1997. Life assured died on 23.9.2001. he obtained policy on 29.3.1999. There was period of 2 years for L.I.C. to check the facts mentioned in the proposal form. No policy can be called in question after expiry of 2 years. He referred Section 45 of Insurance Act. As per provision of Sec.45 of Insurance Act, "no policy can be effected after the coming into force of this Act shall, after the expiry of 2 years from the date on which it was effected be called in question by an insurer on the ground of statement made in the proposal for insurance or in any report of medical officer, or referee, or friend of the insured, or in any other document leading to the issue of the policy, was inaccurate or false, unless the insurer shows that such statement (was on material matter or suppressed facts which it was material to disclose and that it was fraudulently made) by the policy holder and that the policy holder knew at the time of making it that the statement was false(Or that it suppressed facts which it was material to disclose)."
9. Suppression must be fraudulently made by the complainant. The policy holder must have been known at the time of making statement that it was material to disclose. In the instant case, policy holder was suffering from ailment in the year 1997. It is certified that he is fit to resume his duty from 27.2.1998. The said ailment was completely cured before obtaining policy. There was no mention of any ailment by life assured. It is submitted by Adv.Shri.Kalani that fibro alveolitis is pre-existing disease. It has come on record that, life assured was fit to resume his duty. He submitted that, pre-existing disease is that it should not only have existed few years before but also should existed at the time of obtaining insurance policy.He relied on ratio in 'L.I.C. -Vs- Asha Goyal' reported in AIR 2001 Supreme Court 549 in which it held by the Hon`ble Supreme Court that, "merely on the ground that deceased had withheld correct information regarding his health at the time of effecting insurance with Corporation-
5 F.A.No.:695/04not proper-matter of repudiation of policy should not be dealt with in mechanical and routine manner but should be one of extreme care and caution."
10. Life assured died due to Jaundice. There was no nexus between cause of death and ailment from which he was suffering previously. Before obtaining the policy life assured was checked by doctors on pannel. There is no proof that life assured was suffering from any ailment at the time of taking policy. Therefore repudiation of claim by L.I.C. is not proper. Appeal be dismissed.
11. In L.I.C. of India V-s Patel Ganeshbhai Ramji, repored in 2007(II) CPR page 123(NC), Hon`ble National Commission has observed that "history recorded by Dr.Shah which has been relied by appellant is neither supported by and corroborative evidence in the form of affidavit nor does it prove that the said treatment has any reasons to the cause of death."
12. We perused the record. Medical certificate produced on record were of the period from 4.12.1997 to 17.2.1998. Life assured was taking treatment in General hospital, Parbhani and Civil Surgeon mentioned in the certificate that, life assured is fit to resume his duty from 27.2.1998. It is clear that life assured was cured completely from said disease. Policy was taken on 24.3.1999 i.e. after one year of the period of ailment. No evidence produced by LIC to show that life assured was taking any treatment after 27.2.1998 or he had undergone any surgery or any treatment for said disease before taking policy. It is also not proved that life assured was suffering from said ailment at the time of taking policy. As life assured was in medical profession he is having knowledge of his ailment, might have mentioned his disease but as disease was not existing at the time of taking policy, he rightly mentioned in the proposal form in negative. We are of the view that, pre-existing disease should not only have 6 F.A.No.:695/04 existed few years before but also should exist at the time of taking policy. In the light of above discussion and document on record we are inclined to dismiss the appeal. District Forum also considered all these facts in right perspective while allowing the complaint. We do not want to interfere the order passed by the Forum. Hence we pass the following order.
O R D E R 1. Appeal is dismissed.
2. Appellant to pay cost of Rs.1000/- to the respondent in the appeal.
3. Copies of the judgment be issued to both the parties.
Mrs.Uma S.Bora S.G.Deshmukh
Member Presiding Judicial Member.
Mane