National Consumer Disputes Redressal
Life Insurance Corporation Of India vs Surekha Shankar Jadhav on 31 July, 2012
NATIONAL CONSUMER DISPUTES REDRESSAL
COMMISSION
NEW DELHI
REVISION PETITION NO. 2130
OF 2007
(From the order dated 05.03.2007 in First Appeal No. 1353 of 2005 of
the
Maharashtra State Consumer Disputes Redressal Commission,
Mumbai)
Life Insurance Corporation of India
Divisional Manager,
Western Zonal Office,
Yogakshema Jeevan Bima Marg,
Mumbai
Through
Assistant Secretary
Northern Zonal Office,
Jeevan Bharti, Connaught Circus,
New Delhi
...
Petitioner
Versus
1.Smt. Surekha
Shankar Jadhav
R/o Mugali
Tal.
Gandhinglaj
District Kolhapur,
Maharashtra
2.Ku Sagar
Shankar Jadhav(Minor)
sued through natural mother,
Respondent No.
1.
3.Ku Sadhana Shankar Jadhav(Minor) sued through natural mother, respondent No. 1
4.Smt. Laxmi Bai Dugndappa Jadhav R/o Mugali Tal.
Gadhinglaj District Kolhapur, Maharashtra Respondents BEFORE:
HONBLE MR. ANUPAM DASGUPTA, PRESIDING MEMBER HONBLE MR. SURESH CHANDRA, MEMBER For the Petitioner For the Respondents : Mr. Ashok Kashyap, Advocate : NEMO DATED: 31st July, 2012 O R D E R PER SURESH CHANDRA, MEMBER The only issue which has arisen for our consideration in this case is as to whether there was suppression of material information pertaining to his health by the insured at the time of renewal of his lapsed policy.
2.
Briefly stated, the facts of this case are that the deceased-husband of complainant No. 1 and father of complainants No. 2 and 3 had taken two policies bearing No. 945294751 for Rs.50,000/- and No.946169914 for Rs. 1 lakh, in his life time. He died due to heart attack on 6.8.2001. While the claim of the complainants in respect of the policy for Rs. 50,000/- was settled by the petitioner-insurance company, claim of Rs. 1 lakh in respect of the second policy was repudiated. When the complainants did not get a positive response to their legal notice sent in this regard, a consumer complaint was filed before the District Forum, Kolhapur against the insurance company. The opposite party, i.e., insurance company filed its written statement and pleaded that the insured person died within two years of taking the policy and hence an inquiry as to the cause of his death was made in which it was found that the insured had taken treatment at the Karnataka Health Centre and Wanless Hospital, Miraj in the year 2000. It further came to its notice that the insured was taking treatment for HIV from 27.4.2000. He also got admitted to the Wanless Hospital, Miraj for its treatment on 31.7.2001. It was submitted by the insurance company in its reply that this fact was not disclosed by the insured and hence he had given a wrong declaration regarding his health when he got the second policy in question renewed.
According to the insurance company, the insured got his lapsed policy revived on 4.12.2000 by suppressing this material information that he was suffering from HIV from 27.4.2000 and that he was taking treatment therefor.
3. Considering the affidavits and documents placed on record, the District Forum, Kolhapur held that the fact that the deceased was suffering from HIV and he was taking treatment for HIV in two hospitals was not proved by the LIC by adducing any evidence. Mere production of certificate issued by Karnataka Health Centre was not sufficient. Accordingly, the District Forum allowed the complaint and directed the petitioner-company to pay to the complainant a sum of Rs. 1 lakh with interest thereon @9% per annum from 13.9.2004 till realisation alongwith cost of Rs.1,000/-.
4. Aggrieved by the order of the District Forum, the insurance company went in appeal before the Maharashtra State Consumer Disputes Redressal Commission, Mumbai (State Commission in short) which upheld the order of the District Forum and dismissed the appeal summarily.
In these circumstances, the insurance company has come to the National Commission challenging the order dated 5.3.2007 passed by the State Commission through the present revision petition.
5. We have heard Mr. Ashok Kashyap, learned counsel for the petitioner. None has appeared for the respondents. It is submitted by learned counsel for the petitioner that the policy in question had lapsed but was revived on 4.12.2000 after the insured furnished a fresh declaration of health on 10.7.2000 specifically stating that he was not suffering from any disease or had taken treatment from any doctor. Since it was an early death claim, the matter was investigated when it came to the notice of the petitioner that the life assured had concealed material facts about his health although he had taken treatment from Karnataka Health Centre on 27.4.2000 for tuberculosis. It also came to notice that the insured had been diagnosed HIV positive and that he was a chronic alcoholic. Learned counsel submitted that revival of the policy in question constituted fresh contract entered into between the parties and further continuance of the insurance had to be seen on the basis of fresh declaration given by the policy holder. He, therefore, submitted that there was violation of the most sacred principle of Uberima-fide or utmost good faith in this case on account of suppression of material health information by the life assured. He submitted that when this information was specifically produced before the Fora below, there was no evidence in rebuttal to show that the duly certified photocopy of the medical record sheet was forged or fabricated.
Learned counsel contended that the Fora below erred in holding that in spite of the certificate of the hospital placed on record, there was no suppression of material facts fraudulently on the part of the life assured. Another contention of learned counsel was that as long as it can be shown that the life assured had suppressed material information pertaining to his health and knowingly gave information which was wrong, the cause of death is not material. In the present case, he submitted that there is no evidence in rebuttal to the specific certificate of the Karnataka Health Centre produced by the petitioner and it cannot be assumed that the insured was not aware of the disease for which he was taking the treatment. In the circumstances, the petitioner-insurance company was right in rejecting the claim of the complainants on the second policy which had been obtained by the insured person by suppressing material information which vitiated the contract of insurance.
6. We have perused the impugned order and other documents placed on record. The death certificate no doubt mentions heart attack as the reason for the death. The OPD medical record sheet indicates that the insured was HIV positive as noted on the sheet. In such a situation, specific rebuttal of this important information placed on record through appropriate evidence was necessary on the part of the complainants.
The finding/remark that the patient is HIV positive cannot be based on hearsay or history. It would also be wrong to assume that the insured person, who was the patient himself would not be aware of what was noted in the OPD card and would be ignorant about what the doctor had diagnosed and specifically recorded on the OPD card. The Fora below committed a mistake in ignoring this OPD card against which there is no evidence of rebuttal placed by the respondents. This being the situation, it is settled law that when there is deliberate suppression of material fact pertaining to health on the part of the life assured, the contract of insurance which is based on principle of utmost good faith gets vitiated and the cause of death becomes irrelevant.
We, therefore, are of the considered view that the impugned order cannot be sustained in the eye of law and hold that in the given circumstances the rejection of the claim by the petitioner-insurance company in respect of policy in question for Rs. 1 lakh, which had been lapsed but revived after taking up the treatment by the deceased life assured, was right. Consequently, the impugned order is set aside and the revision petition stands allowed. No costs.
..Sd/-
( ANUPAM DASGUPTA.) PRESIDING MEMBER ..Sd/-
(SURESH CHANDRA) MEMBER Naresh/reserved