State Consumer Disputes Redressal Commission
Life Insurance Corporation Of India vs Smt. Bina Joshi on 22 December, 2008
STATE CONSUMER DISPUTES REDRESSAL COMMISSION UTTARAKHAND
DEHRA DUN
FIRST APPEAL NO. 300 / 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. Bina Joshi W/o late Sh. Suresh Chandra Joshi
R/o Tewari Niwas, Nawabi Road
Haldwani
.....Respondent / Complainant
Sh. T.S. Bindra, Learned Counsel for the Appellant
Sh. Arun Uniyal, Learned Counsel for Respondent
Coram: Hon'ble Justice Irshad Hussain, President
C.C. Pant, Member
Smt. Kusum Lata Sharma, Member
Dated: 22/12/2008
ORDER
(Per: C.C. Pant, Member):
This appeal is directed against the order dated 14.08.2007 passed by the District Forum, Nainital, partly allowing the consumer complaint No. 94 / 2006 and directing the Life Insurance Corporation of India to pay to the complainant sum of Rs. 1,00,000/- together with interest @9% p.a. from the date of filing of the complaint till the date of actual payment and Rs. 2,000/- as cost of litigation.
2. The facts of the case, in brief, are that the husband of the complainant Smt. Bina Joshi, had taken an insurance policy from Life Insurance Corporation of India (for short "LIC") - opposite party on his own life for a sum of Rs. 1,00,000/- on 26.06.2002. The policy holder - insured Sh. Suresh Chandra Joshi died on 26.03.2005 due to 2 jaundice. The complainant submitted a claim for the insured sum, but the LIC repudiated the claim on 29.11.2005. The complainant submitted a review application to the LIC, which was pending till the date of filing of the consumer complaint. However, during the pendency of the appeal, it was told that the review application has also been rejected. During the pendency of the review application, the complainant filed the consumer complaint before the District Forum, Nainital, which was decided by the District Forum per impugned order, as stated above. Aggrieved by the said order, the LIC has preferred this appeal.
3. We have heard the learned counsel for the parties and perused the material placed on record in the light of the legal aspects of the case.
4. The learned counsel for the appellant - LIC contended that the primary cause of the death of the insured, as certified by the Physician, were Diabetes and Hepatitis and Koch's Lung (T.B. Lung) and ADS and the immediate cause of the death of the insured was jaundice. The policy holder was admitted in Soban Singh Jina Base Hospital, Haldwani from 12.03.2002 to 22.03.2002 for the treatment of Diabetes Mellitus and Partial Motor Seizure. He was discharged from the hospital on 22.03.2002 and was advised to take complete rest from 23.03.2002 to 05.04.2002. The policy holder had taken medical leave for this period, i.e., from 12.03.2002 to 05.04.2002. The insurance policy was taken on 26.06.2002, but the deceased (policy holder) had concealed the material fact about his health in the proposal form. Since the insurance policy was taken fraudulently, the LIC has rightly repudiated the claim.
35. The learned counsel for the complainant - respondent argued that the policy holder's health was perfect at the time of submitting the proposal form and he had never received any treatment for a period of more than a week. In reply to the interrogatories / questionnaire regarding the health, he had answered correctly, but the proposal form was not filled by the policy holder himself. The agent of the LIC had obtained the policy holder's signatures on the proposal form and the various entries of the proposal form were filled in by the said agent. The learned counsel, thus, argued that no material facts regarding the health of the insured, were concealed. The immediate cause of the death of the insured, has been clearly certified as jaundice and it can not be said that this disease was pre-existing, because the death of the policy holder had occurred after a period of more than two and a half years from the date of taking the policy. The learned counsel, thus, urged that the order of the District Forum, be upheld. Alternatively, he also prayed that if the impugned order is not found fit to be upheld for any reason, the appellant be directed to pay the paid-up value of the policy / the premiums paid upto the date of the death of the policy holder.
6. We considered the respective submissions made by the parties. The first dispute is whether the policy holder had made a willful concealment of the material facts regarding his health or not. The District Forum, after an appreciation of the facts, has concluded that the policy holder had replied correctly to all the questions related with policy holder's health and had not made any willful concealment. Since, as inferred by the District Forum, the proposal form was filled up by the agent, it was the agent, who had not filled the correct information, as stated by the policy holder.
47. In respect of the second dispute regarding the pre-existing disease at the time of taking the policy, the insurance company has relied upon the certificate issued on 19.04.2005 (Paper Nos. 50 to 51) by the Doctor Incharge of the Soban Singh Jina Base Hospital, Haldwani. The District Forum has held that this certificate, can not be treated as a conclusive evidence, because the facts given by the doctor, are contradictory in itself. While the primary cause of death has been stated as "Diabetes Mellitus and Hepatitis and Koch's Lung and ADS", the immediate cause has been stated as "jaundice". On the one hand, the certifying doctor has also stated that the policy holder was suffering from diabetes for the last five and a half years, but at the same time, in reply to question Nos. 6(a) and 6(2), which are in respect of other diseases, the patient was suffering from and details thereof, the certifying doctor has stated that such diseases were not known to him. No affidavit of the certifying doctor has been submitted for these reasons. The District Forum has held that the policy holder was in perfect state of health at the time of taking the policy and he had not concealed any material facts about his health willfully. The District Forum has relied upon the decision of the Hon'ble National Commission in the case of Life Insurance Corporation of India Vs. Vinod Rani; I (2007) CPJ 58 (NC). In the said case, the insurance company could not prove that the policy holder could obtain the policy fraudulently and a period of 2 years had lapsed after taking the policy. Thus, the complainant was given the benefit of Section 45 of the Insurance Act, 1938.
8. We are also of the view that the District Forum's conclusion in respect of the dispute regarding willful concealment of material facts and pre-existing disease at the time of taking the policy, has a logical basis. Apart from the above facts, on further perusal of the record more minutely, we find that the policy holder had replied to the 5 questions relating to his parents' death correctly and sincerely. If the interrogatory / questionnaire, as prescribed by the LIC in proposal form, has any bearing on the acceptance or rejection of the proposal, then the said information, should also be significant in taking a decision as to whether the risk was bad or not. The policy holder had informed the LIC that his father had died at the age of 56 years due to fever and dysentery and his mother had died at the age of 48 years due to jaundice. Inspite of this information, the proposal was accepted. It shows that the LIC and its agents play a foul game with the proposer. The proposals are not scrutinized properly and the main objective of the insurance companies remains to fetch more and more business. We agree with the finding of the District Forum that entries of the proposal form, were filled in by the agent and, therefore, the policy holder should not be blamed for concealing information in respect of leave taken by him from the office or any previous treatment. The policy remained effective for a period of 2 years and 9 months and, therefore, the ratio of the decision of the Hon'ble National Commission in the case of Vinod Rani (supra) shall squarely apply to the facts of the instant case.
9. A further perusal of the record, shows that the policy holder had remained admitted in Soban Singh Jina Base Hospital, Haldwani from 12.03.2002 to 22.03.2002 and the doctor had advised him to take rest for 12 days after discharge from the hospital. The photocopies of the papers at Sl. Nos. 69 to 75, do not specifically tell that the policy holder had suffered from Diabetes, Hepatitis, Kochs etc. Generally, doctors do not tell the patient about the ailments. Moreover, if the ailment, for which the patient (insured) was treated, was so fatal that it may cause death, then the patient can not recover after a 10 days' treatment. There is no evidence on record to prove that the treatment of the insured continued even after discharge from the hospital. The 6 policy had been taken on 26.06.2002, i.e., after a period of 3 months from the treatment. After taking the policy, the insured survived for 2 years and 9 months and for this period, the LIC could not collect any evidence to the effect that the policy holder had taken any treatment for Hepatitis and Kochs. The LIC has obtained two certificates from the doctors on its prescribed form Nos. 3784 and 3816 (Paper Nos. 50 to 53). In form No. 3784, the history of the patient has been mentioned as "Diabetes - 5 years, Koch's Lung - 2 years, Hepatitis and Jaundice - 1 month". The certifying doctor has also stated in this form, in reply to question Nos. 6 and 7, that the details of treatment taken earlier by the policy holder, name of the doctors etc., were not known to him. Thus, the past history of the policy holder, without an affidavit of the certifying doctor, can not be made basis for the repudiation of the complainant's claim. Otherwise also, the Koch's Lungs stated to have occurred to the policy holder 2 years ago. That means, it had occurred after taking the policy and, therefore, it can not be said that the policy holder had concealed the said fact at the time of submitting the proposal form. In form no. 3816, the doctor himself has stated that the policy holder was treated for Koch's. Hepatitis / Jaundice has been stated to have occurred only 1 month ago. The appellant has failed to prove that after taking the policy, the policy holder was ever admitted in the hospital for the treatment of these diseases. As far as the diabetes is concerned, it is a most common disease and is always controllable. A similar view has been expressed by Delhi State Consumer Disputes Redressal Commission, New Delhi in the case of Oriental Insurance Co. Ltd. Vs. Madhusudan Sharma; I (2006) CPJ 494. The Hon'ble National Commission has also laid down a principle in deciding such cases. In the case of Life Insurance Corporation of India Vs. Sajida Begum; III (2007) CPJ 319 (NC), the LIC had alleged that insured had been suffering from hypertension for 15 years and diabetes for 10 years. The policy holder had died due to 7 cardio respiratory arrest and acute renal failure. The LIC also produced medical leave certificates given by the same doctor over the years. The Hon'ble National Commission, after an appreciation of the facts and circumstances of the case, observed that the policy holder was examined and certified as keeping good health and, therefore, found that the insurance company made deficiency in service in repudiating the claim. Further, if that was the exact past history of the policy holder, the patient could not have survived without taking regular treatment for the period of 2 years and 9 months. In such a situation, an affidavit of the certifying Physician, was necessary. In absence thereof, the decision of the District Forum, is quite just and proper.
10. The view of the District Forum, which we also endorse, is further supported by the following decisions:
(i) The Hon'ble National Commission in the case of Life Insurance Corporation of India Vs. Badri Nageswaramma (Deceased) and others; II (2005) CPJ 9 (NC), has held that doctor's certificate without affidavit in support, can not be made basis for repudiating the claim.
(ii) The Hon'ble National Commission in the case of LIC of India Vs. Joginder Kaur and others; II (2005) CPJ 78 (NC), has held that the contention of the insurer that the deceased was suffering from diabetes mellitus, was chronic alcoholic and had an attack of jaundice, was not acceptable in absence of any legally admissible evidence in support thereof.
(iii) The Hon'ble National Commission in the case of L.I.C. of India Vs. Smt. Promila Malhotra; I (2004) CPJ 91 (NC), has 8 held that more than two years had elapsed between the date of issuance of policy and the date of death of the insured and, therefore, under the provisions of Section 45 of the Insurance Act, the policy could not be called in question by the insurer on the ground that the statement made in the proposal form or any report of the medical officers or referee or friend of the insured or in any other document of the company leading to issue of policy, was inaccurate or false, unless the insurer shows that such information was on a material matter and that it was fraudulently made by the policy holder. The Hon'ble National Commission has further observed that, "the least LIC was to do to serve interrogatory on widow requiring her to answer the interrogatory on the spot. In addition to that, no doctor has been examined, nor any affidavit of any medical expert, has been produced to show that the deceased was suffering from kidney failure or of the high blood pressure, which was of the nature, which had direct nexus with the kidney failure".
11. The ratio of the above cited decisions, apply to the instant case, because the facts and circumstances of all the reported cases and the instant one, are more or less the same.
12. The learned counsel for the appellant, in support of his contentions, has relied upon the following decisions:
(i) Maria R. Avita Gonsalves Vs. Life Insurance Corporation of India and another; III (2006) CPJ 303 (NC)
(ii) Gurram Varalakshmi Vs. LIC of India; III (2006) CPJ 304 (NC) 9
(iii) Life Insurance Corporation of India and others Vs. Murti Devi; III (2007) CPJ 110
(iv) Life Insurance Corporation of India Vs. Mansa Devi; II (2003) CPJ 135 (NC)
(v) Draupadi Devi S. Chaudhari Vs. United India Insurance Co.
Ltd.; I (1993) CPJ 94 (NC)
(vi) Decision dated 10.7.2002 of the Hon'ble National Commission in Revision Petition No. 430 of 2001; Life Insurance Corporation of India and another Vs. Smt. Krishna Devi
(vii) Decision dated 15.01.2004 of the Hon'ble National Commission in Revision Petition No. 3507 of 2003; Fateh Chand Kalra Vs. L.I.C. of India.
13. The learned counsel for the appellant has also relied upon the decision of this Commission dated 04.08.2006 in First Appeal No. 52 of 2005; Smt. Lalita Chamoli Vs. Life Insurance Corporation of India and decision dated 28.07.2006 in First Appeal No. 60 of 2005; Smt. Raksha Devi Vs. Life Insurance Corporation of India.
14. We went through the facts of the above cited cases and found that the facts of those cases, are not very close to the facts of the instant case and, as such, the ratio of these decisions, can not be applied directly to the instant case. In the instant case, the appellant could not produce any conclusive evidence that the policy holder had willfully concealed the material facts about his health, which were in 10 his knowledge and had obtained the policy fraudulently. Moreover, the provisions of Section 45 of the Insurance Act, are also applicable in the instant case.
15. For the aforesaid reasons, the appeal is dismissed. No order as to cost.
(SMT. KUSUM LATA SHARMA) (C.C. PANT) (JUSTICE IRSHAD HUSSAIN) Kawal