State Consumer Disputes Redressal Commission
Urvashi Goyal vs M/S Met Life Insurance Company Private ... on 11 January, 2012
STATE CONSUMER DISPUTES REDRESSAL COMMISSION, PUNJAB,
DAKSHIN MARG, SECTOR 37-A, CHANDIGARH.
Consumer Complaint No.46 of 2009
Date of institution : 11.6.2009
Date of decision : 11.1.2012
1. Urvashi Goyal widow of Late Shri Dinesh Goyal son of Shri Suresh Goyal,
resident of Railway Road, Jagraon, District Ludhiana.
2. Shimla Devi wife of Shri Suresh Goyal son of Shri Girdhari Lal, resident of
Railway Road, Jagraon, District Ludhiana.
3. Amisha Goyal (aged 11 years) daughter of Late Shri Dinesh Goyal,
4. Bukal Raj Goyal (aged 8 years) son of Late Shri Dinesh Goyal,
Both residents of Railway Road, Jagraon, District Ludhiana.
(Complainants No.3 and 4 being minors represented through their mother
and natural guardian Smt. Urvashi Goyal wife of Late Shri Dinesh Goyal).
.......Complainants
Versus
1. M/s Met Life Insurance Company Private Limited, 5 Vani Vilas Road,
Basava Nagudi, Bangalore through its General Manager.
2. M/s Met Life Insurance Company Private Limited, SCO No.13, Shingai
Tower, 5th Floor, Feroze Gandhi Market, Opposite Ludhiana Stock
Exchange, Ludhiana through its Branch Manager.
......Opposite Parties/Respondents
Complaint under Section 17 of the Consumer
Protection Act, 1986.
Before :-
Hon'ble Mr. Justice S.N. Aggarwal President.
Mr. B.S. Sekhon, Member.
Present :-
For the complainants : Shri Sanjiv Ghai, Advocate.
For the respondents : Shri Anurag Chopra, Advocate.
JUSTICE S.N. AGGARWAL, PRESIDENT:
Version of the complainants:
Dinesh Goyal now deceased (in short "life assured") was the husband of Urvashi Goyal complainant No.1, son of Shimla Devi complainant No.2 and father Consumer Complaint No.46 of 2009. 2 of complainants No.3 and 4. He came in contact with Ashish Garg who was the Sales Manager of the respondents. On the representation of Ashish Garg, the life assured decided to purchase the insurance policy from the respondents under the Met Life Small Premier Plan for a sum of Rs.20.00 lakhs. The life assured accordingly paid an amount of Rs.1,00,000/- as premium in cash to Ashish Garg on 26.3.2007 for which the respondent Insurance Company had issued the receipt dated 26.3.2007. The payment acknowledgement slip dated 28.3.2007 for Rs.1,00,000/- was also issued by the respondents. The proposal form was signed by the life assured. It was blank at that time and was signed by the life assured at the instance of Ashish Garg, Sales Manager.
2. It was further pleaded that as a pre-requisite, the medical examination of the life assured was got conducted by Ashish Garg, Sales Manager from Dr. Gaurav Sachdeva of Ludhiana Mediciti Hospital, Ludhiana on 7.4.2007. The said doctor had also conducted certain medical tests which were found to be normal. Dr. Gaurav Sachdeva had submitted the medical examination report dated 7.4.2007. Reports of the medical tests which were conducted by Dr. Gaurav Sachdeva on 7.4.2007 included the liver function test (in short "LFT"). However even after the medical tests and medical examinations conducted by Dr. Gaurav Sachdeva on the life assured on 7.4.2007, the life insurance policy was not received on which the life assured had written letter to the respondents on 11.4.2007 under postal certificate asking for the issuance of life insurance policy. There was no response from the respondents. Thereafter the life assured had sent reminder to the Sales Manager of the respondents on 25.4.2007 for expediting the life insurance policy which was required for him for income tax purpose. In spite of that the insurance policy was not received.
3. It was further pleaded that unfortunately the life assured fell ill and was admitted in Sat Guru Partap Singh Apollo Hospital, Ludhiana (in short "Apollo Consumer Complaint No.46 of 2009. 3 Hospital"). The G.G.T. test was conducted on 8.6.2007 and also on 12.6.2007. However the life assured died on 13.6.2007.
4. It was further pleaded that after the death of Dinesh Goyal life assured, complainant No.1 who was the nominee lodged the insurance claim on 15.6.2007 but neither this letter was replied by the respondents nor the insurance claim was settled. Thereafter complainant No.1 sent letter dated 30.7.2007 through registered post requesting respondent No.1 to settle the claim. It's copy was also sent to respondent No.2 but still there was no response.
5. The Insurance Regulatory and Development Authority vide notification dated 26.4.2002 had released Insurance Regulatory and Development Authority (Protection of Policyholders' Interests) Regulations, 2002 by which certain norms were laid down for the protection of the interests of the policyholders. As per clause 6 of regulation No.4 of these regulations, the proposals for the issuance of the life insurance policy were to be expedited and communicated within a reasonable time but not exceeding 15 days.
6. It was further pleaded that complainant No.1 filed the complaint before the Insurance Ombudsman, Chandigarh on 26.9.2007 against the respondents alleging deficiency in service on the part of the respondents and also with the prayer for settlement of the insurance claim Rs.20.00 lakhs along with interest. The respondents, however, submitted before the Insurance Ombudsman, Chandigarh that the report of G.G.T. test of the life assured received on 10.4.2007 was 512 against the normal range of 11-49. The high range of G.G.T. was confirmed on 14.6.2007 i.e. a day after the death of the life assured on 13.6.2007. It was also pleaded that the proposal form of the life assured was postponed for the period of six months on 20.6.2007 and the premium amount of Rs.1,00,000/- was returned to complainant No.1. It was received back undelivered through the courier service by the respondents. The respondents had also shown their ignorance about the death of the life assured or of any insurance claim lodged by complainant No.1 and Consumer Complaint No.46 of 2009. 4 denied having received any letter from life assured for the issuance of the insurance policy or of the letter sent by complainant No.1 for the insurance claim. These submissions made by the respondents before the Insurance Ombudsman were false. Even Ashish Garg, Sales Manager of the respondents was also present on the funeral of the life assured. Even the G.G.T. test conducted on the life assured in the Apollo Hospital was normal.
7. It was further pleaded that the Insurance Ombudsman without holding a detailed enquiry dismissed the complaint vide order dated 4.1.2008 on flimsy grounds and failed to take into consideration the factum that the respondents had intentionally delayed the issuance of the insurance policy. Hence the complaint for the insurance claim of Rs.20 lakhs. Hence the complaint for the insurance claim of Rs.20 lakhs. Compensation, interest and costs were also prayed. Version of the respondents:
8. The respondents filed the written reply. Preliminary objections were pleaded that the complaint was false and malicious. The facts were incorrect and it was filed with mala fide intention. The complaint was an abuse of the process of law. The complainants intended to avail undue advantage. Therefore the complaint was liable to be dismissed. The complainants were not the consumers under the Consumer Protection Act, 1986. The proposal form of the life assured was not accepted for medical reasons. Therefore there was no concluded contract between the life assured and the respondents. The complaint was neither maintainable in law nor on facts. Therefore the same was liable to be dismissed in limine. The contract of insurance takes place only when the offer is accepted by the respondent Insurance Company. Reliance was placed on the judgment of the Hon'ble National Commission reported as "ELSA Tony Philip v. LIC of India and Others" I (2009)CPJ 18 (NC). It was also alleged that the complainants have not come to the Forum with clean hands. It has been filed with mala fide intention on baseless allegations.
Consumer Complaint No.46 of 2009. 5
9. It was admitted that Dinesh Goyal life assured had filled up and signed the proposal form on 28.3.2007 bearing No.108719003 for a Met Smart Premier policy giving all relevant details and information in the prescribed proforma. On page 6 of the proposal form he had given an undertaking that commencement or risk will not take effect until policy was issued by the Insurance Company and that the life assured would undergo all medical tests required by the insurer as per their guidelines including HIV-ELISA test. After filling the proposal form, the life assured had undergone medical examination. It was conducted by Dr. Gaurav Sachdeva on behalf of the respondents on 7.4.2007. The reports were received on 12.4.2007 and 24.4.2007. The amount of insurance was very high i.e. Rs.20 lakhs. Therefore the respondents had requested the life assured to forward copies of his income tax returns. These were received on 23.5.2007. The medical report was received from Ludhiana Mediciti on 24.4.2007 in which it was mentioned that Gamma Glutamyl Transpeptidase (GGT) of the life assured was 512 as against the normal range of 11 to 49. The respondents after noticing the high abnormality in the G.G.T. sought for confirmation of the same which was again confirmed by the test report dated 13.6.2007 issued by the Mediciti, a unit of I.A.A. Hospitals Private Ltd., Ludhiana and received by the respondents on 14.6.2007.
10. It was further pleaded that based on above mentioned medical reports, the respondents had decided to postpone the proposal form for six months. It was communicated to the life assured on 20.6.2007 and a refund cheque for Rs.1,00,000/- was also sent along with it. However the letter dated 20.6.2007 along with the cheque was received back undelivered through the courier service.
11. It was further pleaded that the complainants had initiated action against the respondents in the Insurance Ombudsman, Chandigarh. The Insurance Ombudsman, Chandigarh had heard the parties and after deliberating on the facts and issues of the matter passed an order with an opinion that the non-acceptance of the proposal and refund of the premium amount of Rs.1,00,000/- was in order. Consumer Complaint No.46 of 2009. 6 The death summary report of the life assured from Apollo Hospital, Ludhiana also revealed that the life assured was a chronic smoker and chronic alcoholic for 12 years with history of ileo-transverse anastmosis and short bowel syndrome. However these facts were kept concealed by the life assured while filling the proposal form. In compliance with the order of the Insurance Ombudsman, Chandigarh the respondents had again sent letter dated 21.1.2008 along with the cheque for Rs.1,00,000/- dated 21.1.2008 in favour of the complainants for the refund of the initial deposit. It was again received back by the respondents as the complainant had refused to accept the same.
12. On merits also similar allegations were made and dismissal of the complaint was prayed.
13. The complainants filed the affidavit of Urvashi Goyal complainant No.1. The complainants also produced documents Annexure C-1 to Annexure C-11.
14. On the other hand, the respondents filed the affidavit of Anil. P.M., Associate Director-Legal and duly constituted attorney of the respondents dated 3.12.2009. The respondents also filed documents Ex.OP-1 to Ex.OP-5.
15. On the basis of these documents it was submitted by the learned counsel for the complainants that the complaint be accepted and the respondents be directed to pay the insurance claim along with compensation, interest and costs. Reliance was placed on the Insurance Regulatory and Development Authority (Protection of Policyholders' Interests) Regulations, 2002 and Code of Conduct for Insurance Agents Licensing of Insurance Agents Regulations, 2000. Reliance was also placed on the judgment of the Hon'ble U.T. State Consumer Disputes Redressal Commission, Chandigarh reported as "Life Insurance Corporation of India v. Smt. Baljit Kaur" 1997(2) CPC 426, judgment of this Commission reported as "Dev Dutt Dhiman and M.R. Dhiman v. State Bank of India" 1997(1) CPC 612, judgment of Hon'ble National Commission reported as "Life Insurance Corporation of India v. Mrs. V. Jeeva" 1997(1) CPC 100 and unreported Consumer Complaint No.46 of 2009. 7 judgment of the Hon'ble High Court of Punjab and Haryana at Chandigarh dated 22.3.2011 passed in CWP No.3996 of 2011 (Oriental Insurance Company Limited, Chandigarh v. Khursheed and another).
16. On the other hand, the submission of the learned counsel for the respondents was that there was no merit in the present complaint and the same be dismissed.
17. Record has been perused. Submissions have been considered.
18. The admitted facts are that Ashish Garg was the Sales Manager of the respondents. Dinesh Goyal life assured was the husband of Urvashi Goyal complainant No.1, son of Shimla Devi complainant No.2 and father of complainants No.3 and 4. The respondents are the Insurance Company.
19. The life assured had filled the proposal form for the issuance of life insurance policy under the Met Life Small Premier Plan policy on 28.3.2007. Urvashi Goyal complainant No.1 was shown as the nominee. The proposal form was filled for the life insurance policy for Rs.20 lakhs. Ashish Garg, Sales Manager of the respondents had also signed the proposal form on 28.3.2007. This proposal has been proved by the respondents themselves as Ex.OP-1.
20. It is also alleged by the complainants and not denied by the respondents that Dinesh Goyal life assured had made the payment of Rs.1,00,000/- to the respondents on 26.3.2007 against his application form No.108719003 which was issued by the respondents (Annexure C-1). After the filling of the proposal form on 28.3.2007 the respondents had issued the document Annexure C-2.
21. As all the Insurance Companies do before accepting the proposal form, they get subjected the life assured to medical examination and medical tests. Similarly Dinesh Goyal life assured was got subjected to medical examinations/medical tests. The medical examination/medical tests of Dinesh Goyal life assured were admittedly conducted by Dr. Guarav Sachdeva on 7.4.2007. The medical examination report given by Dr. Gaurav Sachdeva has been proved as Annexure C- 3 which reveals that there was no medical problem with the life assured. This Consumer Complaint No.46 of 2009. 8 report is dated 7.4.2007. ECG medical test was also done in Ludhiana Mediciti Hospital, Ludhiana on the same day i.e. 7.4.2007. The medical tests were also conducted and the report was given by Ludhiana Mediciti, Ludhiana on 7.4.2007. Various reports were given by Ludhiana Mediciti, Ludhiana.
22. After the premium was paid by the life assured to the respondents on 26.3.2007 and after the proposal form was filled and signed by him on 28.3.2007 and after he had got himself subjected to medical examination and subjected to medical tests on 7.4.2007 the life assured had not received the insurance policy. On this, the life assured had written letter dated 11.4.2007 to the respondents under postal certificate with the prayer that life insurance policy be issued to him which was required for income tax purposes. A copy of the letter dated 11.4.2007 and a copy of the UPC have been proved as Annexure C-5.
23. The complainants have alleged that the medical reports dated 7.4.2007 were received by the respondents on 12.4.2007. The respondents in para 4 of the written reply have pleaded that medical examination report of Dr. Gaurav Sachdeva conducted on 7.4.2007 was received by the respondents on 10.4.2007 and 24.4.2007. The respondents, however, have not specified as to which reports were received on 10.4.2007 and which reports were received on 24.4.2007 nor any document has been produced by the respondents to show if some of the medical reports/test reports were received on 24.4.2007. It means therefore that the medical examination reports/medical test reports were received by the respondents either on 10.4.2007 as pleaded by the respondents or on 12.4.2007 as pleaded by the complainants.
24. Even if these reports were received on 24.4.2007, there was no reason for the respondents to hold back the issuance of the life insurance policy in favour of the life assured. If the medical reports of the life assured were doubtful then it was the duty of the respondents to have written a letter to the life assured that since the medical reports were doubtful, therefore, the issuance of the life insurance policy Consumer Complaint No.46 of 2009. 9 was being postponed or the issuance was not possible and the amount of premium to the tune of Rs.One lakh would have been refunded immediately after 24.4.2007 but nothing of that sort was done.
25. If the respondents had found that the G.G.T. level was, on the higher side, as alleged by them, the respondents either would have informed the life assured that he should again subject to the medical test or he would have been informed that since the G.G.T. level was on the higher side, they were waiting for the confirmation but no such step was taken by the respondents. Neither any letter was written to the life assured nor his letter dated 25.4.2007 was replied. Even no letter was sent to Ludhiana Mediciti Centre immediately after 24.4.2007 to confirm the G.G.T. report. At least no such letter has been placed on the file. Therefore this version of the respondents was totally false. They adopted unfair trade practice by remaining silent for a period of about 2 months in violation of the relevant regulations.
26. The complainants had pleaded in para 8 of the complaint that since the life assured had not received the insurance policy even after 7.4.2007 he had written letter dated 11.4.2007 to the Sales Manager of the respondents (Annexure C-5) for issuance of the insurance policy. Reply of para 8 of the complaint was given by the respondents in para 7 of the written reply on merits but it is nowhere pleaded by them if they had not received this letter. Similarly it was pleaded by the complainants in para 9 of the complaint that even after the non-receipt of the life insurance policy from the respondents after 11.4.2007 and after receiving no reply to this letter dated 11.4.2007 the life assured had written another letter dated 25.4.2007 to the respondents as a reminder (Annexure C-6) which was again sent under postal certificate that the insurance policy was not received and it was required. The reply to this para is given in para 8 of the written reply by the respondents and it was pleaded that the respondents duly suggested to the deceased proposer and also communicated to him the fact of non-acceptance of his proposal Consumer Complaint No.46 of 2009. 10 form on account of medical reasons along with a refund cheque for the entire amount received.
27. This reply given by the respondents is totally false. The respondents have not placed on the file any document to show if they had replied either to letter dated 11.4.2007 or to the letter dated 25.4.2007. It is also falsely pleaded by the respondents that in response to letter dated 25.4.2007, they had communicated to the life assured the fact of non-acceptance of his proposal form on account of medical reasons or if the respondents had also sent along with the reply, the refund cheque for the entire amount received.
28. On the one hand, in para (g) of the preliminary objections the respondents have taken the plea that they had sent the cheque for Rs.1,00,000/- to the complainants vide letter dated 20.6.2007 but in para 8 of the written statement on merits they have pleaded that they had sent the cheque to the complainants for Rs.1,00,000/- in response to his letter dated 25.4.2007. Therefore the contradictory stand taken by the respondents leads only to the conclusion that they are taking totally false plea to save themselves from their liability.
29. In any case, if the version of the respondents is believed that the medical examination reports/medical test reports of the life assured were received by the respondents on 10.4.2007 and 24.4.2007 and that they had found that G.G.T. level was 512 against the normal range of 11-49, it was the duty of the respondents to have informed to the life assured that since his GGT level was high, therefore, they have kept the life insurance policy pending. The respondents have not taken this plea if after the receipt of the medical examination reports/medical test reports of the life assured on 10.4.2007 and on 24.4.2007 or in response to the letter dated 11.4.2007 and 25.4.2007 received from the life assured, they had ever communicated to the life assured that his medical test report was doubtful and they were keeping the matter pending. The respondents have also not placed on the file Consumer Complaint No.46 of 2009. 11 any document which they might have sent to him in those days. Therefore the version of the respondents is proved to be totally false.
30. The respondents have taken the plea that high level of G.G.T. of the life assured was confirmed by the test report dated 13.6.2007 issued by the Mediciti, a Unit of IAA Hospitals Pvt. Ltd., Ludhiana. This report (OP-5) appears to have been manipulated by the respondents to avoid their liability. The respondents have nowhere pleaded if the life assured had subjected himself to the medical test to the Mediciti Hospital after 7.4.2007, then how the report of the Mediciti Hospital dated 13.6.2007 could be received by the respondents from the Mediciti Hospital. The life assured had submitted himself for medical tests in Mediciti Hospital on 7.4.2009 and whatever reports were given by Dr. Gaurav Sachdeva or by Mediciti Hospital were received by the respondents on 10.4.2007 or on 24.4.2007.
31. The story of the respondents that they had received another report from the Mediciti Hospital on 13.6.2007 is totally manipulated as it is nowhere pleaded even by the respondents if the life assured Dinesh Goyal had gone to Mediciti Hospital for medical test after 7.4.2007 nor it is proved if the respondents had written any letter to the Mediciti Hospital for confirming the G.G.T. level of the life assured. Assuming the respondents had written such letter the confirmation report would have been received within a week and not after two month. Therefore the report dated 13.6.2007 allegedly sent by the Mediciti Hospital to the respondents is totally a manipulated and a forged document. This document has been forged by the respondents to justify their stand for causing delay in issuance of the insurance policy.
32. Even as per the guidelines issued by the Life Insurance Corporation of India, Northern Area, New Delhi or by the Insurance Regulatory and Development Authority, the respondents were to accept or refuse the acceptance of the proposal form within a reasonable time and not exceeding 15 days. When the proposal form Consumer Complaint No.46 of 2009. 12 has been filled, when the first installment of premium has been paid, when the life assured had submitted himself to medical examination/medical tests and when the medical examination reports/medical test reports were received by the Insurance Company at the maximum on 24.4.2007, the life insurance policy should have been issued by the respondents within 15 days from 24.4.2007 i.e. before the mid of May 2007 or the respondents should have refused to accept the proposal form by that time. But the respondents did none of them.
33. Therefore the version of the respondents that since the insurance policy was not issued in favour of the life assured till his death on 13.6.2007, therefore, no concluded contract between the life assured and the Insurance Company, is totally fictitious and unbelievable. If this submission is accepted, it would mean that the respondent Insurance Company after completing all the formalities could sit silent and might not issue the insurance policy for the period of one year or till the casualty takes place and still they would be able to say that there was no concluded contract between the life assured and the Insurance Company.
34. The respondents have also taken a false plea that since the amount of insurance policy was very high, therefore, the respondents requested the life assured to send the respondents the copies of his income tax returns and these were received on 23.5.2007. The respondents have of course placed on the file some income tax returns but they have not placed on the file any letter which might have been written by the respondents to the life assured asking him to send them the income tax returns. If the amount of insurance policy was very high, the respondents knew it on 28.3.2007 itself when the proposal form was filled by the life assured for seeking the insurance policy for Rs.20 lakhs. If the income tax returns were required as the amount of insurance policy was very high, the respondents should have asked the life assured for these income tax returns before asking the life assured to subject himself to medical examination and medical tests on 7.4.2007.
Consumer Complaint No.46 of 2009. 13
35. It is very strange that the respondents accepted the premium amount of Rs.1,00,000/- on 26.3.2007, accepted the proposal form on 28.3.2007, asked the life assured to undergo medical examination/medical tests and accepted the reports on 10.4.2007 and 24.4.2007 and thereafter asked the life assured to submit the income tax returns. It appears to be ludicrous. This story of the respondents is totally false. They have merely arranged the income tax returns of the life assured from some source and used it as a plea that they had demanded the income tax returns from the life assured. If it had been so, there would have been some letter written by the respondents to the life assured and some letter of the life assured to the respondents by which the income tax returns were sent by him to the respondents. Therefore there being no such document, the only possible conclusion is that this version of the respondents is totally false.
36. It appears, therefore, that after the respondents received the information about the death of the life assured on 13.6.2007, they started concocting stories and forging documents to find the escape route and save themselves from making the payment of the assured amount forgetting all principles of ethics or legal duties. The respondents should have behaved like the true insurers. Rather they acted very cleverly and wrote letter dated 20.6.2007 to the life assured that they would be considering his request after six months and, therefore, they were returning the amount of Rs.1,00,000/-. By 20th June, 2007 when the respondents had written this alleged letter, complainant No.1 nominee had already written letter dated 15.6.2007 to the respondents thereby lodging the insurance claim. A copy of the letter dated 15.6.2007 has been proved by the complainant as Annexure C-10. When the respondents received this letter, they devised the manners and methods to repudiate the claim one way or the other. Therefore the version of the respondents is totally false.
37. Since the respondents had intentionally delayed the issuance of the insurance policy for the period of more than 2 months, therefore, it will be Consumer Complaint No.46 of 2009. 14 presumed in these circumstances that a concluded contract had actually taken place. If the life assured had died within 4/5 days or say within 15 days, then it could be believed that there was no concluded contract. In this context reference may be made to the judgment of the Hon'ble Supreme Court reported as "Life Insurance Corporation of India v. Raja Vasireddy Komalavalli Kamba and others" AIR 1984 (SC) 1014 but in that case the life assured had died the next day after paying the amount of premium, the facts of which have been narrated by the Hon'ble Supreme Court in para 1 of the judgment as under:-
"One late Raja Basireddi Chandra Dhara Prasad (hereinafter referred to as 'deceased') died intestate on 12th January, 1961. He had filled a proposal for insurance for Rs.50,000/- on 27th December, 1960. There was medical examination by the doctor of the life of the deceased on 27th December, 1960. The deceased had issued two cheques for Rs.300/- and Rs.220/- respectively in favour of the appellant as first premium. Cheque for Rs.300/- was encashed by the appellant on 29th December, 1960. Cheque for Rs.220/- was dishonoured three times and finally encashed on 11th January, 1961. As mentioned hereinbefore, the deceased died on the day following i.e. on 12th January, 1961. On 16th January, 1961, the widow of the deceased, respondent No.1 herein, wrote to the appellant intimating the death of the deceased and demanded payment of Rs.50,000/-. The Divisional Manager, Masulipatam Branch, denied liability on behalf of the appellant Corporation on 28th January, 1961. Thereafter there was correspondence between the parties between 1st Consumer Complaint No.46 of 2009. 15 February, 1961 to 23rd December, 1963 wherein the respondent plaintiffs had claimed the payment and the appellant had denied liability for the same."
38. In that case the life assured had died the next day after paying the amount of premium and, therefore, it was held that no concluded contract had taken place. Therefore this judgment is not applicable to the facts of the present case as in the present case the respondents had failed to issue the insurance policy even after the expiry of about two months from the date when the life assured got subjected himself to medical examination/medical tests on 7.4.2007 and about 45 days after the respondents had received the medical examination reports/medical test reports on 24.4.2007. Therefore there was no justification for the respondents to hold back the issuance of the insurance policy for 45 days nor they can be allowed to escape by taking wrong/false pleas.
39. Clause 4(6) of the Insurance Regulatory and Development Authority (Protection of Policyholders' Interests) Regulations, 2002 reads as under:-
"(6) Proposals shall be processed by the insurer with speed and efficiency and all decisions thereof shall be communicated by it in writing within a reasonable period not exceeding 15 days from receipt of proposals by the insurer."
40. Therefore the only conclusion which possibly can be drawn in these circumstances is that the contract of insurance had in fact taken place after the expiry of 15 days from 24.4.2007 i.e. on 10.5.2007. The life assured had died on 13.6.2007. Therefore the respondents are liable to pay the insurance claim.
41. So far as the judgment of the Hon'ble National Commission in ELSA Tony Philip's case (supra) on which reliance was placed by the respondents is concerned, the facts of that case were also different. Tony Philip had purchased the insurance policy on 29.3.1995 for an amount of Rs.3,00,000/-. Proposal form was filled by him. A cheque of Rs.1662/- was given. Tony Philip had met with an accident on Consumer Complaint No.46 of 2009. 16 17.4.1995 and had died. It is also mentioned in the end of para 2 that signatures on the medical report accompanying the proposal form also varied with the signatures of the deceased on other documents. Therefore the liability to pay the amount claimed was denied. In the present case neither there was any difference in the signatures on the medical reports nor there was delay of 45 days after the receipt of medical examination reports/medical test reports. Even the Insurance Regulatory and Development Authority (Protection of Policyholders' Interests) Regulations, 2002 had not come into force which required the insurers to communicate the acceptance within 15 days. Therefore the judgment in ELSA Tony Philip's case relied upon by the respondents is not applicable to the facts of the present case.
42. In the present case, the respondents remained silent for 45 days after the receipt of the amount of premium on 26.3.2007 accepting the proposal form on 28.3.2007, getting the proposer to medical examination/medical test on 7.4.2007, receiving the medical reports on 10.4.2007 and 24.4.2007 and they failed to issue the insurance policy till the death of the life assured on 13.6.2007. However in the intervening period from 24.4.2007 to 13.6.2007 the respondents had not communicated either the acceptance or the refusal of the life insurance policy to the life assured nor they had communicated any objection to the life assured which may amount to refusal. Therefore the silence of the respondents for such a long time amounted to acceptance of the insurance policy particularly in view of clause 4(6) of the Insurance Regulatory and Development Authority (Protection of Policyholders' Interests) Regulations, 2002, the respondents were bound to take a decision within 15 days of the receipt of the claim.
43. Hon'ble High Court of Punjab and Haryana at Chandigarh in Khursheed's case (supra) also was pleased to observe as under:-
" Insurance Companies are charging hefty premium for insuring the vehicles. Once the question of liability arises, the Consumer Complaint No.46 of 2009. 17 companies resort to one technical objection and the other. These Companies really chase people and literally promise everything at the time of selling policy. It is usual to see people struggle to run after agents and surveyors to get their rightful claims. Such agents then look other way and make insurers to make rounds to Company offices. Insurers are then made to approach the Courts and are even dragged to this Court on one technical plea or the other. No one really is made to read the terms while making him to sign on the printed forms for selling policies. This attitude must change. At least, the Courts should not be burdened with this uncalled for litigation."
44. It is, therefore, held that the respondents had intentionally withheld the issuance of the insurance policy and the concluded contract had taken place between the parties.
45. In these circumstances complaint is accepted with costs of Rs.10,000/-. The respondents are directed to pay the insurance claim of Rs.20.00 lakh with interest at the rate of 9% per annum from 20.6.2007 till the date of payment.
46. The respondents are burdened with another amount of Rs.20,000/- as compensation payable to the complainants for concocting false stories and preparing forged documents and thereby adopting unfair trade practice.
47. The arguments in this case were heard on 3.1.2012 and the order was reserved. Now, the order be communicated to the parties.
48. The complaint could not be decided within the statutory period due to heavy pendency of court cases.
(JUSTICE S.N. AGGARWAL)
PRESIDENT
January 11 , 2012 (BALDEV SINGH SEKHON)
Bansal MEMBER
Consumer Complaint No.46 of 2009. 18