State Consumer Disputes Redressal Commission
Mrs. S.Visakalakshmi, W/O.Late ... vs The General Manager, Bank Of Baroda, ... on 31 August, 2023
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Date of filing : 19.02.2015.
IN THE TAMIL NADU STATE CONSUMER DISPUTES REDRESSAL
COMMISSION, CHENNAI.
Present: Hon'ble Thiru Justice R.SUBBIAH ... PRESIDENT
C.C. No.46 of 2015
Wednesday the 30th day of August, 2023
Mrs. S.Visakalakshmi,
W/o Late Senthil Ganesh,
4/64, Second Main Road,
M.A.V.Mummorthy Avenue,
Kaspapuram, Selaiyur,
Chennai, Tamil Nadu - 600 073. ... Complainant
Vs.
1. The General Manager,
Bank of Baroda, Zonal Office,
Baroda Pride,
41, Luz Church Road,
Mylapore, Chennai - 600 004.
2. The Branch Manager,
Bank of Baroda,
32, Palani Andavar Koil Street
Vadapalani, Chennai-600 026.
3. India First Life Insurance Company Ltd.,
301, "B" Wing, The Qube,
Infinty Park, Dindoshi - Film City Road,
Malad (East), Mumbai - 400 097,
Rep. by its Head Claims. ... Opposite Parties
For Complainant : M/s. Rajashree
For Opp. Parties 1&2 : M/s. K.Ravikumar
For Opp. Party No.3 : M/s. Kishore Kumar
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This Complaint came up for final hearing on 25.08.2023 and, after
hearing the arguments and perusing the materials on record and
having stood over for consideration till this day, this Commission
passes the following:-
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ORDER
R.Subbiah, J. - President.
This complaint has been filed as against the opposite parties for the following reliefs:
(a) Directing the Opposite parties jointly and severally to pay the Insurance Claim amount of Rs.3,31,124.00 under Bank Account No.29900600000102 bearing Policy No.G00000091 and Rs.15,93,069.00 under Bank Account No.29900600000667 bearing Policy No.G0000091 for the loans availed by the Complainant's husband along with interest at the rate of 18% p.a from the date of the death of the Life Assured to the Complainant till the date of realization of the said amount.
(b) Directing the Opposite Parties herein jointly and severally to pay the complainant a sum of Rs.5,00,000/- towards compensation for deficiency in service for repudiating the claim amount; and (c) cost of the complaint.
2. The case of the complainant is that her husband late Senthil Ganesh was a software Engineer employed at M/s. Symantec Corporation Chennai. Her husband had initially applied for a Plot loan on 04 th October, 2007 to the second opposite party for a sum of Rs.8,44,000.00 for purchasing a plot situated at No.4/65, Plot-3, II Main Road, MAV Mummorthy Avenue, Kaspapuram, Selaiyur. The said Plot loan was sanctioned by the second opposite party on 17th October, 2007 and the EMI 3 for the Plot loan commenced from 19th November, 2007 and a sum of Rs.9070/- was deducted every month from the account of her husband. Thereafter, her husband had availed House Loan of Rs.17,06,140.00 on 06 th January, 2012 for construction of a house in the said Plot from the second Opposite Party. The house loan was sanctioned by the second opposite party on 31st January, 2012 and the EMI for the house loan commenced on 08 th June, 2012 and a sum of Rs.46,000/- was paid on 20.06.2012 and subsequently Rs.20,000/- was regularly repaid every month by her husband till his death. At the time of availing housing loan, the second opposite party had represented that the third opposite party Insurance Company is the joint venture of the second opposite party along with two others and that the Life Assured would be covered by the third opposite party on payment of a single premium towards the loan accounts. The said premium is insurance coverage for the loan amount by the third opposite party as part of risk coverage and protects the family from burden of liabilities against uncertainty. The second opposite party being the Master Policy holder, premiums would be collected by them and paid to the third opposite party. The loan documents provided by the second opposite party were duly submitted by the complainant with the necessary details required.
3. Since the second opposite party had stated that the insurance coverage is part of the loan availed, insurance premium of Rs.4,899.74 was 4 debited from the account No.29900600000667 of her husband on 07.03.2012 for the period 07.03.2012 to 06.03.2037 and Rs.25,139.62 for the house loan was debited from the account No.29900600000102 on 25.05.2012 for the period 25.05.2012 to 24.05.2028. The said single premiums were paid by her husband to the second opposite party being the Master Policy Holder. The loans were secured under the Master Policy Nos. G0000091 and G0000013 by the third opposite party for which certificates of insurance were duly issued on 25.05.2012 and 07.03.2012 respectively.
4. The loan documents did not contain either the Membership Form or Insurance Proposal Form and that the Life Assured was not asked to furnish health declaration to the effect at any time. The said insurance proposal forms were submitted by the second opposite party as Master Policy Holder to the third opposite party. The Life Assured was not aware about the existence of any such forms, nor copies of the said Forms were furnished to the Life Assured at the time of availing the said loans. Her husband/Life Assured had developed hyper-pigmentation on both his lower limbs in the month of October 2010. On consultation with Dr.Muralidhar Rajagopalan, her husband/Life Assured underwent various tests as per the doctor's advice on 08.10.2010 and subsequently he was then referred to Dr.R.Varadarajan, Consultant, Hematologist, Apollo Hospital Pvt. Ltd., Chennai for further evaluation on 18.10.2010. Dr.R.Varadarajan reviewed the Life Assured and 5 gave opinion on 30.11.2010 that the Life Assured had Nutritional Dimorphic Anemia, which is not serious or life-threatening ailment. The Life Assured was advised for intake of green leafy vegetables and was prescribed Fefol capsules, folvite tablets and Renerve injection for a particular period. The Life Assured showed improvement and the said medicines were continued till August 2011. The blood test reports were also normal and the Life Assured continued with his normal day to day activities. Her husband was not suffering from any ailment or had any symptoms of ailment which required medical attention and he was like any other person living his normal life.
5. The complainant's husband had availed loans in the year 2007 and 2012 and at the time of availing the said loans her husband was not suffering from any ailment which required medical treatment during the said period. At the time of availing the said loans, neither any proposal forms were given by the second opposite party to the complainant which required disclosure of health conditions nor had necessary columns in the copies of the said form relating to the health condition that had to be filled by the Life Assured at the time of availing the said loans were furnished to him. Moreover, there was no necessity for her husband to give any false or misleading information/ suppression of any material facts at the time of availing the said loans as her husband was not suffering from any Life threatening ailment or was undergoing treatment during the said 6 period. While so, during the evaluation for infertility in the month of March, 2013, and upon various tests conducted by doctors, her husband/Life assured was suspected to have Grade I Fatty Liver with enlarged spleen and was given medications by doctors concerned, and thereafter, the Life Assured was referred to Christian Medical College, Vellore, for further evaluation. The CMC, Vellore after examining and conducting various tests came to a conclusion that her husband/Life Assured had Auto Immune chronic liver disease - Hepatic Cirrhosis with Portal Hypertension. Life Assured was given medication and was in CMC, Vellore, from 04.11.2013 till 08.12.2013. The Life Assured was subsequently discharged from the said hospital on 08.12.2013 and was advised to continue the medicines prescribed by the said doctors. The Life Assured died on 05.02.2014 on the way to hospital and the cause of death was due to cardio respiratory arrest.
6. Since the Life Assured had availed two loans from the second opposite party, the Life Assurer's father had requested the second opposite party for closure of loan accounts by settlement of insurance claim vide letter dated 03.04.2014, enclosing all the necessary documents. Since there was no reply from the second opposite party, another representation dated 16.04.2014 addressed to the first opposite party was given for closure of the said loan accounts by settlement of the insurance claim. The first opposite party in its reply, through e-mail dated 17.04.2014, had sought for copies of 7 medical documents. Accordingly, Vide letter dated 19.04.2014 along with Death Certificate dated 15.02.2014, Medical Certificate dated 05.02.2014 and the Discharge Summary Report dated 04.12.2013 was handed over in person to the second opposite party and the same was acknowledged by the second opposite party. The aforesaid documents submitted would reflect that there has been no suppression of material facts as alleged by the third opposite party. A representative from the third opposite party for field investigation had called for the Life Assured's father Mr.G.Manoharan over phone and sought for relevant documents. The Life Assured's father had explained his inability to meet the said representative as he was on an important meeting at his office and had requested him to visit his house and collect the necessary documents on the next day. However, subsequently, there was neither any call from the third opposite party nor any representative visited the Life Assured's house to carry out field investigation. Finally, the third opposite party sent a reply rejecting the claim vide letter dated 30.04.2014 stating that the Life Assured was suffering from Pancytopenia and was undergoing treatment for the same prior to obtaining of the insurance policies. It is further stated that the Life Assured had suppressed material facts regarding his past medical history and has not declared truthfully and correctly about his health in the health declaration form prior to obtaining the said policies. Thus the claim has been repudiated by the third opposite party on the ground of non-disclosure of material 8 information at the time of the proposal. Complainant's father-in-law had also requested the second opposite party vide letter dated 14.05.2014 to furnish copies of the insurance proposal form, insurance policies and health declaration form alleged to have been signed by the Life Assured, but there was no reply from the second opposite party. Against the said rejection letter, the Life Assured's father had given a detailed representation to the Appellate Authority of the third opposite party vide letter dated 14.05.2014 and had also requested to furnish the copies of Master Policies, insurance proposal forms and health declaration purportedly signed by the Life Assured. The appeal was again repudiated by the said authority vide letter dated 02.06.2014, on the ground that the Life Assured had been suffering from Pancytopenia and that the same was not disclosed at the time of the proposal. The opposite parties have failed to furnish the copies of the said documents to the complainant despite her requests. The repudiation letters dated 30.04.2014 and 02.06.2014 have been issued by the same person of the third opposite party and the said repudiation letter reflects total non- application of mind by the Appellate Authority and the same has been pre- decided in a hasty manner. The said repudiation letter dated 02.06.2014 issued by the third opposite party is totally incorrect, improper, arbitrary and unjustified, and the same has been issued with a mala fide intention to evade the liability. Hence, the complainant was constrained to approach before the Insurance Ombudsman seeking claim of the insurance amount 9 and for closure of the loan account of her husband/Life Assured. The necessary documents along with the details of the complaint against the Nos. G0000013 and G0000091 issued by the third opposite party were filed before the Insurance Ombudsman on 20.09.2014. The Insurance Ombudsman after hearing the complainant and the third opposite party passed an award on 24.11.2014 granting an ex gratia amount of Rs.3,00,000/- under both the policies to be paid to the complainant by the third opposite party towards full and final settlement of the claim. The Insurance Ombudsman while passing the award has observed that the Life Assured's health condition was normal before taking the said policies and also the reports dated 16.02.2012 from the Madras Andrology & Assisted Reproduction Research Centre also do not reflect that the Life Assured has been treated for Pancytopoenia and further the consultation paper of Dr.Rajasekaran also does not reflect that the Life Assured suffered from Pancytopenia but subsequently he has arbitrarily concluded that the non disclosure of the pre-proposal illness has been clearly established.
7. The opposite parties have committed deficiency in service. The second opposite party despite being aware of the death of complainant's husband and that a genuine claim exists under the said policies and the same ought to have been settled by the third opposite party, has deliberately with mala fide intention and ulterior motive, has issued a notice under 10 Section 13(2) of the SARFAESI Act, 2002 in the name of the complainant's husband, who is no more and to the Guarantor of the loan accounts stating that the complainant's husband has defaulted in repayment of the loan amount, is a clear procedural deviation and deficiency of service, and has thus caused immense hardship and irreparable loss besides acute mental agony to the complainant. The third opposite party having received the premiums of Rs.4,899.84 and Rs.25,139.62 towards two policies was duty bound to settle the insurance claim on account of the death of the Life Assured since the said policies were in force. The second opposite party being the Master Policy Holder of the third opposite party having received the premiums from the complainant towards the said loans without any proposal forms to that effect reflects gross deficiency in service committed by the opposite parties by not sending the entire claim amount. Hence, for the alleged deficiency of service the present complaint has been filed for the reliefs stated supra.
8. Resisting the claim of the complainant the opposite parties 1 and 2 filed a common version, wherein, among other things, it is stated thus:-
One Mr.Senthil Ganesh availed housing loan from the second opposite party for a sum of Rs.8,44,000/- on 04.10.2007 for purchase of vacant plot and again the said Mr.Senthil Ganesh availed another housing loan for a sum of Rs.17,06,140/- on 06.01.2012 from the second opposite party for 11 construction of house. The opposite parties bank had facilitated the insurance cover to the said Mr.Senthil Ganesh with India First Life Insurance Company Limited for both the loans and the same was availed by Mr.Senthil Ganesh for both the loans. Mr.Senthil Ganesh filed the relevant application forms and other formalities in respect of obtaining insurance policy directly with the third opposite party's representative i.e. India First Life Insurance Company Limited. As part of banker the second opposite party have debited his account and transferred the premium amount to the third opposite party. While so Mr.Senthil Ganesh had died and one Mr.G.Manoharan sent a letter to the second opposite party on 03.04.2014 requesting for closure of the loan accounts by settlement of insurance taken from the third opposite party by Mr.Senthil Ganesh. Thereafter, on 17.04.2014 the second opposite party sent an e-mail to the said G.Manoharan requesting him to produce all the relevant documents for the claiming insurance amount. The said G.Manoharan had sent the documents to the second opposite party bank for further processing. The second opposite party had forwarded all the relevant documents submitted by the said G.Manoharan along with its letter dated 21.04.2014 to the third opposite party for settlement of claim. On 30.04.2014, the third opposite party directly sent a letter to the said G.Manoharan informing that "the Company is therefore repudiating the claim for Non disclosure of Material Information at the time of making the proposal and no benefits are payable as per policy terms and conditions". Again on 12 14.05.2014, the said G.Manoharan requested for settlement of claim and the same was sent by the second opposite party to the third opposite party for further course of action. Since the complainant was not satisfied with the reply of the Insurance Company, the complainant had approached the Insurance Ombudsman. The Insurance Ombudsman after hearing the complainant and the insurance company passed an award on 24.11.2014, granting ex gratia of Rs.3,00,000/- totally under both the policies by the insurance company. Thus, the opposite parties 1 and 2 have not committed any deficiency in service in facilitating the said Mr.Senthil Ganesh to get the insurance cover for him as a measure to safeguard and protect the interest of the family from the burden in the event of occurrence of any uncertainty.
The payment of premium from the said loan account of Mr.Senthil Ganesh was to ensure the insurance cover without any default. In fact the complainant is liable to pay the amount due in both the loan accounts of late Senthil Ganesh to the opposite parties 1 and 2 and since the third opposite party had rejected the claim of the complainant she cannot shift the burden on the opposite parties 1 and 2 by claim and compensation by way of complaint. The opposite parties 1 and 2 are committed to serve its customers to their satisfaction and continue to do in all its banking transactions. There is no deficiency of service on the part of the opposite parties 1 and 2 and thus, they sought for dismissal of the complaint. 13
9. The third opposite party has filed a version stating that the complaint had raised unreasonable objections and averments in the complaint which are baseless and devoid of any merit. The complainant has failed to demonstrate any deficiency in service on the part of the third opposite party. The deficiency as defined under Section 2(g) of the Consumer Protection Act, 1986 which means any fault, imperfection, shortcoming or inadequacy in the quality, nature and manner of performance; which is required to be maintained in pursuance of a contract. But in the present case the complainant had concealed the material facts before this Commission that the deceased Life Assured Late Mr.Senthil Ganesh had suppressed the material facts pertaining to past medical history that he was suffering from Hyper pigmentation in both lower limbs with enlarged liver with Pancytopenia (Low Haemoglobin, Low White Blood Cells and low Platelets), increased bilirubin level, Hepatomegaly, peripheral smear showing leucopenia, hyper pigmented neutrophils and bone marrow showed mild megaloblastic changes from 2010 and underwent treatment for the same till 2011 i.e. prior to inception of the policies in question. Further, the complaint is not maintainable and liable to be dismissed as the complainant has failed to demonstrate any deficiency in service of the third opposite party. In the present case the third opposite party repudiated the claim as per the terms and conditions of the service policies. Hence, there is no deficiency on the part of the third opposite party.
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10. The contract of insurance is based on a foundation of utmost good faith i.e. principle of uberrimae fides that means the life assured or proposer has to maintain and observe complete good faith in entering into an insurance contract with the insurer. The Life Assured or proposer is under solemn obligation to make full, complete true and correct disclosure of the material facts which may be relevant for the insurer to take into account while deciding whether the proposal should be accepted. If the Life Assured or Proposer failed to disclose the true and correct material facts to the insurer then the policy obtained by the Life Assured or Proposer stands vitiated and the Life Assured or any person claiming under it is not entitled for any benefits under the said policy. In the present case, it was revealed that the Life Assured had concealed the material fact pertaining to past medical history. Life Assured was suffering from Hyper pigmentation in both lower limbs, enlarged liver, Pancytopenia (Low Haemoglobin, Low White Blood Cells and low Platelets), increased bilirubin level, Hepatomegaly, peripheral smear showing leucopenia, hyper pigmented neutrophils and bone marrow showed mild megaloblastic changes in 2010 and underwent treatment for the same till 2011. The above illness suffered was a material fact towards the insurance of this policy and that the life assured had failed to disclose the said material fact while signing the proposal for insurance of the policies in question. If the life assured would have disclosed about the 15 past medical history, the opposite party No.3 would not have issued the subject policies.
11. In spite of having complete knowledge regarding the past medical history, the deceased life assured intentionally withheld the material information from the third opposite party and choose not to disclose the true and correct facts. The deceased Life Assured had fraudulent intentions from the very beginning to defraud the third opposite party and to extract undue benefit. This is further fortified by the fact that the insured had opted for insurance of first loan taken in 2007 only in 2012 which clearly shows the fraudulent intent. The insured should have had knowledge about the disease and had wantonly suppressed it. Thus, sought for dismissal of the complaint.
12. To substantiate the claim and counter claim, both sides have filed their respective proof affidavits and, while the complainant has marked 31 documents as Exs.A1 to A31, the opposite parties have marked 12 documents as Exs.B1 to B12.
13. Heard the submissions of the counsel for the parties and perused the materials available on record.
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14. The learned counsel for the complainant submitted that the complainant's husband had initially applied for a Plot loan from the second opposite party on 04.10.2007 for a sum of Rs.8,44,000.00 for purchasing a plot and had availed House Loan on 06.01.2012 for a sum of Rs.17,06,140.00 for construction of a house in the said Plot. At the time of availing housing loan on 06.01.2012, the second opposite party had represented that the third opposite party Insurance Company is the joint venture of the second opposite party along with two others and that the Life Assured would be covered by the third opposite party on payment of a single premium towards the loan accounts. The second opposite party being the Master Policy holder, premiums would be collected by them and paid to the third opposite party. A sum of Rs.4,899.74 was debited from the account No.29900600000667 of the Life Assured on 07.03.2012 for the period 07.03.2012 to 06.03.2037 and Rs.25,139.62 for the house loan was debited from the account No.29900600000102 of the Life Assured on 25.05.2012 for the period 25.05.2012 to 24.05.2028. The loans were secured under the Master Policy Nos. G0000091 and G0000013 by the third opposite party for which certificates of insurance were duly issued on 07.03.2012 and 25.05.2012 respectively.
15. The said loan documents did not contain either the Membership Form or Insurance Proposal Form and the Life Assured was not asked to 17 furnish health declaration to the effect at any time. The complainant's husband was not aware about the existence of any such forms, nor copies of the said Forms were furnished to the Life Assured at the time of availing the said loans. The complainant's husband had availed loans in the year 2007 and 2012 and at the time of availing the said loans her husband was not suffering from any ailment which required medical treatment during the said period. Only in the month of October 2010 her husband/Life Assured was taken treatment for hyper-pigmentation on both his lower limbs. On consultation with Dr.Muralidhar Rajagopalan, her husband/Life Assured underwent various tests and subsequently Dr.R.Varadarajan, Consultant, Hematologist, Apollo Hospital Pvt. Ltd., Chennai reviewed the Life Assured and gave opinion on 30.11.2010 that the Life Assured had Nutritional Dimorphic Anemia, and the same is not serious or life-threatening ailment. The Life Assured was advised for intake of green leafy vegetables and was prescribed Fefol capsules, folvite tablets and Renerve injection for a particular period. While so, the Life Assured continued the medicines till August 2011. Thereafter, in the month of March, 2013, upon various tests conducted by doctors, her husband/Life assured was suspected to have Grade I Fatty Liver with enlarged spleen and was given medications by doctors concerned, and thereafter, the Life Assured was referred to Christian Medical College, Vellore, for further evaluation and after examining and conducting various tests came to a conclusion that her husband/Life Assured 18 had Auto Immune chronic liver disease - Hepatic Cirrhosis with Portal Hypertension. The Life Assured was given medication and he was subsequently discharged from the said hospital on 08.12.2013 and he died on 05.02.2014. But the Insurance Company had repudiated the claim on the ground of non-disclosure of material information at the time of the proposal. Complainant's father-in-law had also requested the second opposite party vide letter dated 14.05.2014 to furnish copies of the insurance proposal form, insurance policies and health declaration form alleged to have been signed by the Life Assured, but there was no reply from the second opposite party. Against the said rejection letter, the Life Assured's father had given a detailed representation to the Appellate Authority of the third opposite party vide letter dated 14.05.2014 and had also requested to furnish the copies of Master Policies, insurance proposal forms and health declaration purportedly signed by the Life Assured. The appeal was again repudiated by the said authority vide letter dated 02.06.2014, on the ground that the Life Assured had suppressed material facts regarding his past medical history and has not declared truthfully and correctly about his health in the health declaration form prior to obtaining the said policies and non disclosure of health condition at the time of making the proposal. But the complainant's husband was not suffering from health threatening diseases while availing the two loans. While the loans were availed in the year 2007 and 2012, and the insurance premiums were collected by the second opposite party from the 19 loan accounts of the complainant's husband, he was not suffering from any ailment which required medical treatment. In the month of October 2010 the Complainant's husband had taken treatment for hyper pigmentation on both his lower limbs. After examining various medical tests, Dr.R.Varadarajan reviewed the Life Assured and gave opinion on 30.1.2010 that the Life Assured had Nutritional Dimorphic Anemia and the same is not a serious or life-threatening ailment. In the month of March, 2013, only CMC, Vellore had manifested on surmises and conjectures that the Life Assured had Auto Immune chronic liver disease. The tenor of the surmises and conjecture on the part of the third opposite party is only in order to absolve the opposite parties from their liability to make insurance claim. Thus, the counsel for the complainant meticulously stated that the claimant's husband was not suffering from any disease. Ignoring all these facts, the Insurance Company had repudiated the claim of the Complainant as if the complainant had suppressed the ailments suffered by him at the time of taking policy. In fact, there was suppression of material facts only on the part of the opposite parties. There is deficiency in service on the part of the opposite parties. Thus, he prays for the direction to the opposite parties to pay the insurance claim amount and for compensation.
16. Countering the same, learned counsel appearing for the opposite parties 1 to 2 bank submitted that the opposite parties bank had facilitated insurance coverage to the complainant's husband namely 20 Mr.Senthil Ganesh for both the loans and the same was availed by him for both the loans. The complainant's husband is liable to pay both loan accounts in the opposite parties 1 and 2 bank since the third opposite party repudiated the claim made by the complainant. Hence, the complainant is not entitled for any relief against the opposite parties 1 and 2. The opposite parties 1 and 2 are not liable to pay any insurance claim in fact the complaint itself is not maintainable against the opposite parties 1 and 2. Thus, they sought for dismissal of the complaint.
17. Counsel appearing for the third opposite party submitted that even before taking the policies the complainant's husband was suffering from Hyper pigmentation in both lower limbs, enlarged liver with Pancytopenia (Low Haemoglobin, Low White Blood Cells and low Platelets), increased bilirubin level, Hepatomegaly, peripheral smear showing leucopenia with hyper pigmented neutrophils and bone marrow showed mild megaloblastic changes in 2010 and underwent treatment for the same till 2011. It is pertinent to note that the complainant's husband had availed the first loan in the year 2007, whereas he had taken insurance policies in 2012. In spite of having complete knowledge regarding the past medical history, the deceased life assured intentionally withheld the material information from the third opposite party and choose not to disclose the true and correct facts. The 21 deceased Life Assured had fraudulent intentions from the very beginning to defraud the third opposite party and to extract undue benefit.
18. The learned counsel for the third opposite party also invited the attention of the Commission to Clause 3 of the "Membership Forms" - India First Group Credit Life Plan" to which the deceased/Life Assured answered negatively with regard to question put forth in respect of his health condition. He died on 05.02.2014 due to cardiac respiratory arrest. The death had occurred within one year nine months from the date of answering of the risk. The Life Assured had expired within two years from the date of inception of the insurance policies. From the death claim intimation by the complainant's father in law submitted along with medical records, it could be seen from the report dated 18.10.2010 the complainant's husband had been diagnosed with Pancytopenia c/o Cutaneous Hyperpigmentation Progressive+ which is a deadly disease. The Life Assured's Hemoglobin level in that said report was 8.2 mg./dl. The total Bilirubin of deceased was 1.56 mg./dl with progressive in nature. The Bone marrow aspiration cytology report of deceased clearly shows that he had dual deficiency caused by Anemia, combined with B12 and iron deficiency. The medical records produced by the deceased father would show that the deceased underwent medication for Auto Immune treatment but he knowingly suppressed those material facts 22 while issuing the policies. Therefore, there is clear suppression of material facts. Thus, sought for dismissal of the complaint.
19. Though very many contentions have been raised by both the parties on the factual aspects, the only question that has to be decided in this case is:
Whether there is suppression of material facts by the complainant's husband while taking insurance policies from the third opposite party?
If this issue is decided that would suffice to dispose of this complaint.
20. According to the counsel for the complainant, the complainant's husband was not suffering from any life threatening disease while availing the two loans i.e. on 17.10.2007 and 06.01.2012 respectively and also when the second opposite party enrolled the complainant's husband on 07.03.2012 and 25.05.2012 i.e. the date on which the insurance premiums were deducted from the accounts of the Life Assured's loan accounts. It is the further case of the complainant that neither the loan account had contained even Membership Form, Proposal Form nor the complainant's husband had given health declaration at the time of availing the loans. The complainant's husband is not aware about the existence of the insurance proposal forms. Therefore, the question of suppression of material facts regarding the 23 ailments suffered by him at the time of inception of policies does not arise in this case.
21. But it is the submission of the counsel for the opposite parties that the Life Assured had concealed the material facts that he was suffering from Hyper pigmentation in both lower limbs, enlarged liver, Pancytopenia (Low Haemoglobin, Low White Blood Cells and low Platelets), increased bilirubin level, Hepatomegaly, peripheral smear showing leucopenia with hyper pigmented neutrophils and bone marrow showed mild megaloblastic changes in 2010 and underwent treatment for the same till 2011. Further, the counsel for the opposite parties invited the attention of this Commission to Membership Forms for policies i.e. after the policy taken on 07.03.2012 and demonstrated that the complainant's husband had answered negatively to the question sought with regard to the past medical history and Clause 3 of the "Membership Forms" - India First Group Credit Life Plan" which are as follows:-
Question No:1:
Are you suffering or have you ever suffered from any illness/ disease/ ailment up to the date of making this health declaration or suffer from any physical or mental condition?
Answer: No Question No: 2.
Have you ever suffered in the past for symptoms of high blood pressure, diabetes, heart attack or disease, stroke, chest pain, kidney disease, AIDS or positive HIV test, cancer or tumour, asthma or respiratory disease, mental or nervous 24 disease, liver disease (including hepatitis B carrier), blood disease, digestive and bowel disorder, arthritis or deformities or any other not stated above?
Answer: No Question No: 3.
Have you ever been hospitalized up to the date of making this health declaration?
Answer: No The said form was signed by the Life Assured on 07.03.2012. Whereas the documents Ex.B.7 dated 18.10.2010 medical document would show that the Life Assured had been diagnosed with Pancytopenia c/o Cutaneous Hyper pigmentation Progressive+ which is a deadly disease. The Life Assured's Hemoglobin level in that said report was 8.2 mg./dl. The total Bilirubin of deceased was 1.56 mg./dl with progressive in nature. The Bone marrow aspiration cytology report of deceased clearly shows that he had dual deficiency caused by Anemia, combined with B12 and iron deficiency. The medical records produced by the deceased father would show that the deceased underwent medication for Auto Immune treatment but he knowingly suppressed those material facts while issuing the policies. Whereas policies were taken only on 07.03.2012 and on 25.05.2012 after availing the loan in between 2007 and 2012. But he has not mentioned these facts in the question put forth in the Membership Forms at the time of taking policy on 07.03.2012 and 25.05.2012. Therefore, I am of the considered opinion that there is clear suppression of material facts by the Life Assured at the time of issuance of policies. 25
22. It is well settled legal principle that, in matter of insurance policies like the present instance, suppression and misrepresentation of material facts would render the policy invalid in the eye of law. Such an instance enables the Insurance Company to repudiate the claim arising from the policy for the reason that the principle of uberrima fides/ utmost good faith is flouted due to suppression of material facts. If the insured has knowledge of facts which others cannot know, he should not resort to suppressio veri/suppression of truth. In the case on hand, since the insured had suppressed the material facts about his medical history which is the criterion for considering the issuance of the policy itself, the complainant cannot expect any positive consideration of the claim. With regard to the same, it would be appropriate to rely upon some of the following judgments submitted by the counsel for the appellants/opposite parties:
i) (2019) 6 SCC 175 [Reliance Life Insurance Co.
Ltd. & anr. Vs. Rekhaben Nareshbhai Rathod] wherein it is held that the failure of the insured to disclose the policy of insurance obtained earlier in the proposal form entitles the insurer to repudiate the claim under the policy.
ii) 2020 SCC Online SC 848 [Branch Manager, Bajaj Allianz Life Insurance Co. Ltd., & Ors Vs. Dalbir Kaur] wherein it is held that, "A contract of insurance is one of utmost good faith. A proposer who seeks to obtain a policy of life insurance is duty bound to disclose all material facts 26 bearing upon the issue as to whether the insurer would consider it appropriate to assume the risk which is proposed. It is with this principle in view that the proposal form requires a specific disclosure of pre-existing ailments, so as to enable the insurer to arrive at a considered decision based on the actuarial risk. In the present case, as we have indicated, the proposer failed to disclose the vomiting of blood which had taken place barely a month prior to the issuance of the policy of insurance and of the hospitalization which had been occasioned as a consequence. The investigation by the insurer indicated that the assured was suffering from a pre-
existing ailment, consequent upon alcohol abuse and that the facts which were in the knowledge of the proposer had not been disclosed. This brings the ground for repudiation squarely within the principles which have been formulated by this Court in the decisions to which a reference has been made earlier. In Life Insurance Corporation of India vs Asha Goel, this Court held:
"12...The contracts of insurance including the contract of life assurance are contracts uberrima fides and every fact of material (sic material fact) must be disclosed, otherwise, there is good ground for rescission of the contract. The duty to disclose material facts continues right up to the conclusion of the contract and also implies any material alteration in the character of risk which may take place between the proposal and its acceptance. If there is 27 any mis-statements or suppression of material facts, the policy can be called into question. For determination of the question whether there has been suppression of any material facts it may be necessary to also examine whether the suppression relates to a fact which is in the exclusive knowledge of the person intending to take the policy and it could not be ascertained by reasonable enquiry by a prudent person."
The above judgements are squarely applicable to the facts of this case also.
23. In this case the Life Assured has failed to disclose that he was suffering from Hyper pigmentation in both lower limbs, enlarged liver, Pancytopenia (Low Haemoglobin, Low White Blood Cells and low Platelets), increased bilirubin level, Hepatomegaly, peripheral smear showing leucopenia, hyper pigmented neutrophils and bone marrow showed mild megaloblastic changes in 2010 and was undergoing treatment for the same in the year 2010 and 2011. Whereas, it could be seen from the report dated 18.10.2010 the complainant's husband had diagnosed with Pancytopenia c/o Cutaneous Hyperpigmentation Progressive+ which is deadly disease. The Life Assured's Hemoglobin level in that said report was 8.2 mg./dl. The total Bilirubin of deceased was 1.56 mg./dl with progressive in nature. The Bone marrow aspiration cytology report of deceased clearly shows that he had dual deficiency caused by Anemia, combined with B12 and iron deficiency. 28 The medical records produced by the deceased father would show that the deceased underwent medication for Auto Immune treatment but he knowingly suppressed those material facts while issuing the policies, which is evident from the medical documents marked as Ex.B.7 which came into existence prior to taking of the policy in the year 2012. Therefore, there is clear suppression of material facts on the part of the Life Assured. Hence, there is no deficiency in service on the part of the Insurance Company/third opposite party in repudiating the claim made by the complainant. Therefore, the complaint is liable to be dismissed.
24. In the result, the complaint is dismissed. No costs.
R.SUBBIAH, J.
PRESIDENT.
29LIST OF DOCUMENTS MARKED ON THE SIDE OF THE COMPLAINANT Sl.No. Date Description of Documents Ex.A1 19.10.2007 Statement of Account-AC No.29900600000102 Ex.A2 05.10.2010 Report from Deptt. Of Histopathology Ex.A3 08.10.2010 Report from Deptt. Of Bio-Chemistry Ex.A4 08.10.2010 Report from Deptt. Of Haematology Ex.A5 09.10.2010 Report from Radiology Ex.A6 18.10.2010 Report from Centre for Blood Disorder-
Dr.R.Varadarajan Ex.A7 27.11.2010 Report from Centre for Blood Disorder-
Dr.R.Varadarajan Ex.A8 08.01.2011 Report from Centre for Blood Disorder-
Dr.R.Varadarajan Ex.A9 07.02.2012 Statement of Account -AC No.29900600000667 Ex.A10 16.02.2012 Report from Madras Andrology & Assisted Reproduction Research Centre Ex.A11 07.03.2012 Certificate of Insurance -G0000013-09377-AC No.29900600000667 Ex.A12 25.05.2012 Certificate of Insurance - G0000091-01784 -AC No.29900600000102 Ex.A13 -12.2013 Discharge Summary Report -CMC Vellore Ex.A14 05.02.2014 Certificate from Bethesda Hospital Ex.A15 25.05.2014 Death Certificate of Senthil Ganesh Ex.A16 -04.2014 Legal Heirship Certificate of Senthil Ganesh Ex.A17 03.04.2014 Letter from Mr.G.Manoharan to Second Opposite Party Ex.A18 16.04.2014 Letter from Mr.G.Manoharan to Zonal Manager, Bank of Baroda.
Ex.A19 16.04.2014 email from Mr.G.Manoharan to Zonal Manager, Bank of Baroda.
Ex.A20 17.04.2014 Reply from Second Respondent to Mr.G.Manoharan Ex.A21 19.04.2014 Letter from Mr.G.Manoharan to Zonal Manager, Bank of Baroda Ex.A22 30.04.2014 Repudiation of Claim from Third Opposite Party Ex.A23 15.04.2014 Letter from Mr.G.Manoharan to Second Opposite Party Ex.A24 02.06.2014 Repudiation of Claim from Third Opposite Party Ex.A25 10.06.2014 Application from G.Manoharan to The Public Information Officer - RTI Act, 2005 Ex.A26 16.07.2014 Appeal Under RTI Act 2005 Ex.A27 20.09.2014 Representation by Complainant before Insurance Ombudsman Ex.A28 13.10.2014 -do-
Ex.A29 06.11.2014 Minutes of the hearing before Insurance Ombudsman 30 Ex.A30 24.11.2014 Award passed by Insurance Ombudsman Ex.A31 13.01.2015 Notice under Sec.13(2) of the SARFAESI Act issued by Second Opposite Party.
LIST OF DOCUMENTS MARKED ON THE SIDE OF THE OPP. PARTIES Sl.No. Date Description of Documents Ex.B1 25.05.2012 Certificate of Insurance (Policy No.G0000091) Ex.B2 07.03.2012 Certificate of Insurance (Policy No.G0000013) Ex.B3 07.03.2012 Member Form for Policy No.G0000013 Ex.B4 -- Policy document Ex.B5 -- Policy document Ex.B6 24.02.2014 Death claim intimation along with death certificate Ex.B7 18.10.2010 Medical Documents Ex.B8 08.12.2013 Discharge summary Ex.B9 19.04.2014 Letter received from nominee father Ex.B10 17.06.2015 Underwriting opinion Ex.B11 30.04.2014 Repudiation Letter Ex.B12 02.06.2014 Consideration repudiation letter R.SUBBIAH, J.
RESIDENT.
Index: Yes/No GR/TNSCDRC/Chennai/Orders/AUGUST/2023