State Consumer Disputes Redressal Commission
Pnb Met Life India Insurance Co. Ltd. vs Sukhjit Kaur & Ors. on 15 April, 2015
2nd Additional Bench
STATE CONSUMER DISPUTES REDRESSAL COMMISSION, PUNJAB
DAKSHIN MARG, SECTOR 37-A, CHANDIGARH
First Appeal No. 977 of 2013
Date of institution: 11.9.2013
Date of Decision: 15.4.2015
PNB MetLife (formally known as "MetLife") India Insurance Company Ltd.,
Brigade Seshmahal, 5 Vani Vilas Road, Basavanagudi, Bangalore-560004,
Karnataka.
Appellants/OPs
Versus
1. Sukhjit Kaur w/o Late Sh. Balwant Singh,
2. Tarsem Singh s/o Late Sh. Balwant Singh,
3. Veerpal Kaur d/o Late Sh. Balwant Singh
All residents of Near Gurudwara Sahib Singh, Village Sukhna Ablu,
Tehsil Gidderbaha, District Sri Muktsar Sahib.
Respondents/Complainants
First Appeal against the order dated 14.6.2013
passed by the District Consumer Disputes
Redressal Forum, Sri Muktsar Sahib.
Quorum:-
Shri Gurcharan Singh Saran, Presiding Judicial Member
Shri Jasbir Singh Gill, Member
Present:-
For the appellants : Sh. Umesh Kumar, Advocate
For the respondents : Sh. B.S. Aulakh, Advocate
Gurcharan Singh Saran, Presiding Judicial Member
ORDER
2 FIRST APPEAL NO. 977 OF 2013 The appellants/OPs (hereinafter referred as "the OPs") have filed the present appeal against the order dated 14.6.2013 passed by the District Consumer Disputes Redressal Forum, Sri Muktsar Sahib (hereinafter referred as the District Forum) in consumer complaint No.287 dated 25.9.2012 vide which the complaint filed by the respondents/complainants(hereinafter referred as the complainants) was allowed with a direction to the OPs to pay a sum of Rs. 7,50,000/- to the complainants within two months from the date of receipt of the copy, failing which the complainants will be entitled to recover interest @ 7.5% from the date of order till realization.
2. The complaint was filed by the complainant under the Consumer Protection Act, 1986 (in short 'the Act') against the OPs on the allegations that the Ops were well known in the field of Insurance. Being allured with the benefits offered by the Ops, Balwant Singh husband of complainant No. 1 and father of complainant Nos. 2 & 3 duly purchased insurance policy from OP No. 2 at Sri Muktsar Sahib on 18.7.2011 after paying the requisite premium to the tune of Rs. 18,400/-. During the insurance period, Balwant Singh unfortunately died on 15.8.2011 due to sudden illness. As per the terms and conditions of the policy, the complainants were entitled to the claim the sum assured under the policy. The claim was lodged alongwith all the documents with the Ops, however, the Ops repudiated the claim of the complainants vide their letter dated 17.4.2012 by giving the vague and baseless reasons that the complainant had not disclosed material facts to the OP at the time of obtaining the insurance policy. 3 FIRST APPEAL NO. 977 OF 2013 The Ops made their best enquiries regarding the physical illness of DLI Balwant Singh and get his checked up from the Doctors of Apollo Hospital, Bathinda in the presence of their agents and then issued the policy. Therefore, repudiation of the claim was illegal, amounts to deficiency in services. Hence, the complaint with a direction to the Ops to pay sum assured alongwith compensation for harassment and litigation expenses.
3. The complaint was contested by the Ops, who in their written reply took the preliminary objections that the complaint filed was false, frivolous and malafide, therefore, liable to be dismissed under Section 26 of the Act; the complaint filed by the complaints does not cover any consumer dispute. The policy was issued in favour of the DLI after he understood the terms and conditions, voluntarily filled up the proposal form bearing No. 165250632 dated 18.7.2011 and paid the premium against the sum assured of Rs. 7,50,000/- and he also signed the benefit illustrations. On the basis of information contained in the proposal form, the policy was issued by the Ops in favour of the life assured. He also singed the declaration given under the proposal form that he had gone through the application and furnished the information after fully understanding the contents thereof and understood the terms and conditions of the plan and that he had made complete, true and accurate disclosure of all the facts to the best of his knowledge. The statement of last attending physician was recorded on 12.10.2011 wherein it was stated that DLI died on 15.8.2011 due to acute heart failure. The DLI had died during the period of one month from the date of issuance of the policy, 4 FIRST APPEAL NO. 977 OF 2013 therefore, the Ops investigated the claim from the agency, named as Hawk Vision, Delhi and during the course of investigation, the Ops received the record from Punjab Health System Corporation and observed that DLI admitted in the hospital on 5.8.2011 and discharged on 15.8.2011 after 17 days and he was a known case of Bronchial Asthma and was suffering from chronic renal failure and he complained of severe abdominal pain for the last 5-6 months and had been suffering from bed sores. It was also duly confirmed by Dr. P.K. Satyanarayana that problem of renal failure is subject to diagnose when the problem persisted for more than 3-6 months, therefore, the DLI was suffering from Bronchial Asthama and renal failure before taking the policy. He intentionally did not give this information and in case this information was withheld, it vitiates the policy because policies are issued under 'Uberrima Fides' i.e. Utmost Faith of the parties. Same pleas were taken on merits. It was submitted that the complaint was without merit and it be dismissed.
4. The parties were allowed by the learned District Forum to lead their evidence.
5. In support of his allegations, the complainant had tendered into evidence affidavit of Tarsem Singh Ex. CW-1/A, legal notice Ex. C-1, postal receipts Exs. C-2 & 3, acknowledgement Ex. C- 4, claim rejection letter Ex. C-5, ration card Ex. C-6, claim decision letter Ex. C-7, death certificate Ex. C-8. On the other hand, Ops had tendered proposal form Ex. Op-1, claim form Ex. Op-2, admission card of Pb. Health System Corp. Ex. Op-3, repudiation letter Ex. Op- 4, reply to notice Ex. Op-5.
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6. After going through the allegations in the complaint, written reply filed by the OP, evidence and documents brought on the record, the complaint was allowed by the learned District Forum.
7. We have heard the learned counsel for the parties.
8. In the grounds of appeal, it has been stated that the policy No. 20616224 was issued to the deceased LA. He was admitted in the hospital on 5.8.2011 and died on 15.8.2011, therefore, DLI had died within a period of one month, which shows that the life assured was suffering from pre-existing disease, which he did not disclose at the time of filling up the proposal form, therefore, in case the DLI had withheld the material information then it vitiate the policy. This fact was not properly appreciated and wrongly allowed the complaint of the complainant.
9. However, it was argued by the counsel for the respondents/complainants that prima-facie the Ops have not been able to prove on the record any document showing that the complainant was suffering from any pre-existing disease or had taken any treatment in any hospital before taking the policy. Therefore, it is necessary to go through the documents placed on the record by the parties. The complainant apart from affidavit of the Tarsem Singh son of the DLI had tendered into evidence the legal notice Ex. C-1, its postal receipts is Exs. C-2 & 3 and A.D. Ex. C-4 and Ex. C-5 is the letter addressed to the son of the complainant from Member of the Claims Committee wherein it was mentioned that the DLI was known case of Bronchial Asthma suffering from chronic renal failure. It was observed on the basis of medical opinion that renal failure cannot 6 FIRST APPEAL NO. 977 OF 2013 happen during one month and if this condition would have been disclosed by the DLI to the Ops, they might have not issued the policy and accordingly, the claim was repudiated. Ex. C-6 is the copy of the ration card. Ex. C-8 is the death certificate. Whereas the Ops have placed on the record the proposal form Ex. Op-1 in which there is no reference of taking any previous treatment and any pre-existing disease. Ex. Op-3 is the record of the Punjab Health System Corporation and the history shows that he was admitted in the hospital on 5.8.2011 with complaint of Bronchial Asthama and was suffering chronic renal failure (CRF) and case of bed sores and this problem can be diagnosed only when the patient have the problem for a long period i.e. 3-6 months and bed sores can be developed only in case the patient is confined to bed for a sufficiently long period. Whereas the DLI was admitted in the hospital after a gap of 17th day of taking the policy. Such diseases referred above cannot occur within a period of 17 days, which shows that the DLI had some pre-existing disease but he did not disclose at the time of taking policy. Although the Ops have not been able to get any documentary evidence of taking any treatment by the DLI but the matter was got investigated through Hawk Vision, Delhi and in his report, the cause of death has been mentioned as cardiac arrest. They also has affirmed that the DLI was suffering from Bronchial Asthma for the past 5-6 months. Therefore, the nature of disease which the DLI had before his death i.e. suffering from Bronchial Asthma, chronic renal failure (CRF) and bed sores but these were not disclosed by him at the time of taking the policy. It is not necessary that pre-existing can 7 FIRST APPEAL NO. 977 OF 2013 be proved by the Op by way of leading some evidence of taking treatment by the DLI because that record is inexclusive knowledge of the DLI but on the basis of circumstances of case it can be inferred whether the DLI was having any pre-existing disease before taking the policy. In case the DLI had died within a period of one month and was admitted in the hospital within a period of 17 days and the deceased was just aged 46 years only, normally, the person does not die at that age unless one had an acute problem. The counsel for the appellant had cited the judgment 2008(1) RCR (Civil) 127 "P.C. Chacko and another versus Chairman, Life Insurance Corporation of India and others". In that case, the person obtained insurance policy by suppressing the fact of major operation. Death of the policy holder within six months. Policy was repudiated on the ground of suppression of material fact. Order of repudiation was upheld. Further the Hon'ble Apex Court in 2009(8) SCC 316 : IV (2009) CPJ 8 "Satwant Kaur Sandhu versus New India Assurance Company Ltd." followed the same law. In that case the policy holder was suffering from Chronic Diabetes and Renal Failure/Diabetic Nephropathy and was on regular haemodialysis, therefore, he was fully aware of the state of his health but this fact was suppressed by him at the time of taking the policy and died after 7 months of taking the policy. It was observed that the claim was rightly repudiated. Further it was held in Para No. 20 that:-
"The upshop of the entire discussion is that in a Contract of Insurance, any fact which would influence the mind of a prudent insurer in deciding whether to accept or not to accept the risk is 8 FIRST APPEAL NO. 977 OF 2013 a "material fact". If the proposer has knowledge of such fact, he is obliged to disclose it particularly while answering questions in the proposal form. Needless to entitle the insurer to inaccurate answer will entitle the insurer to repudiate his liability because there is clear presumption that any information sought for in the proposal form is material for the purpose of entering into a Contract of Insurance."
10. Further recently it was held by the Hon'ble National Commission in Revision Petition No. 4822 of 2012 "Life Insurance Corporation of India versus Archna Dayanand Vakade" decided on 7.2.2014. In that case, the insured had obtained two insurance policies and proposal forms were filed on 12.1.2007 & 2.3.2007. Husband(insured) of the complainant died on 28.2.2008 i.e. after one year. Claim was repudiated on the ground of concealment of material facts that he had suffered from giddiness/headache and admitted in Dr. Chidgupkar Hospital Pvt. Ltd. Solapur from 16.8.2006 to 22.8.2006 but did not disclose this fact in the proposal form. It was held that from the record it was proved that the insured had suppressed the material facts and followed the principle laid down in Satwant Kaur Sandhu's case(supra) and allowed the revision petition.
11. In the present case, the insured was admitted in the hospital on 5.8.2011 with complaint of Bronchial Asthama and was suffering chronic renal failure(CRF). He was also suffering from bed sores and this problem can be developed only when the patient had the problem from a long period. As it is proved from the record that 9 FIRST APPEAL NO. 977 OF 2013 the insured was admitted in the hospital within 17 days after taking the policy and he had not disclosed about the pre-existing disease in the proposal form, as such, it is proved that Balwant Singh had suppressed the material facts at the time of taking the policy from the Ops. As mis-statement/concealment is violation of terms and conditions of the policy as the contract of insurance is based upon 'utmost good faith' and in case any insured had violated the principle then the insurance company reserves the right to repudiate the policy on that ground, therefore, we are of the opinion that the claim has been rightly repudiated by the OPs.
12. Accordingly, the order passed by the learned District Forum is set-aside. The complaint filed by the complainant is hereby dismissed.
13. In view of the above discussion, the appeal filed by the appellant is accepted. No order as to costs.
14. The appellant had deposited an amount of Rs. 25,000/- with this Commission at the time of filing the appeal and Rs. 3,75,000/- in compliance with the order dated 23.9.2013. These amounts with interest accrued thereon, if any, be remitted by the registry to the appellant by way of a crossed cheque/demand draft after the expiry of 45 days, subject to stay, if any, by the higher Fora/Court.
15. The arguments in this appeal were heard on 1.4.2015 and the order was reserved. Now the order be communicated to the parties as per rules.
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16. The appeal could not be decided within the statutory period due to heavy pendency of Court cases.
(Gurcharan Singh Saran)
Presiding Judicial Member
April 15, 2015. (Jasbir Singh Gill)
as Member