State Consumer Disputes Redressal Commission
Mohammad Sirajuddin Khalid, S/O Late ... vs Bharti Axa General Insurance Co., Ltd., on 23 November, 2012
BEFORE A.P STATE CONSUMER DISPUTES REDRESSAL COMMISSION AT HYDERABAD F.A.No.660 OF 2011 AGAINST C.C.NO.197 OF 2010 DISTRICT FORUM-II VIJAYAWADA AT KRISHNA DISTRICT Between: Mohammad Sirajuddin Khalid, S/o Late S.A.K.Jellany, Aged 50 years, Advocate,Door No.14-11-1, Atchyuta Ramaiah Street, Hanumanpet, Vijayawada 520 003. Appellant/complainant A N D Bharti AXA General Insurance Co., Ltd., Vijayawada Rep., by its Branch Manager, Flat No.A-1, 4th Floor, Jagirdar Mall No.2, M.G.Road, Vijayawada. Respondents/opposite party Counsel for the Appellant M/s P.Shiv Kumar Counsel for the Respondent M/s Katta Laxmi Prasad QUORUM: SRI R.LAKSHMINARASIMHA RAO, HONBLE MEMBER
AND SRI THOTA ASHOK KUMAR, HONBLE MEMBER FRIDAY THE TWENTY THIRD DAY OF NOVEMBER TWO THOUSAND TWELVE Oral Order (As per Sri R.Lakshminarasimha Rao, Honble Member) ***
1. The unsuccessful appellant is the appellant.
2. The brief facts of the case as seen from the complaint are that the appellant purchased car bearing No.AP16 BJ 10 Hyundai I10 Magna in the year 2008 and the same was insured with M/s Bajaj Alianz Insurance Company for a period of one year commencing from 06-04-2009 to 05-04-2010. Two months prior to the expiry of the said policy M/s Bajaj Allianz Insurance company had sent a renewal premium notice for `8,160/-. The representatives of the respondent approached the appellant and informed that they would insure the car for one year for a premium of `6,150/- which is lesser than the amount quoted by M/s Bajaj Insurance company. The appellant issued post-dated cheque dated 03-04-2010 and the respondent issued cover note and informed the appellant that in the event of any claim, he need not pay any cash at the authorized work shop and claim would be settled in no time directly by the company. Having verified the proposal and cover note the respondent issued comprehensive policy for appellants vehicle for the period of one year from 06-04-2010 to 05-04-2011.
3. The appellants vehicle met with an accident on 04-06-2010 and the vehicle was extensively damaged and the said fact was informed to the respondent. The appellant shifted the vehicle to an authorized workshop on the same day. The surveyor of the respondent insurance company inspected the vehicle and gave permission to make repairs. After completion of repairs the appellant made a claim before the respondent. The respondent refused to settle the claim on the ground that the appellant made false declaration. The appellant received letter dated 05-07-2010 from the respondent wherein the notice that the respondent mentioned that the appellant declared that he has not made any claim but on verification it is found he made two claims on the previous policy and hence the appellant is not entitled to claim the amount under the policy.
4. The respondent resisted the case contending that that the declaration clause and NCB Clause in proposal form provide for true and correct statement made by the appellant. The appellant concealed the fact of claims made with his earlier insurer and gave false declaration that he had not made any claim in the previous policy and that he is eligible for NCB upon expiry of the previous policy and entered into the contract of insurance with the respondent. There is clear misrepresentation and suppression of material facts by the appellant with regard to his earlier claims with his earlier insurer and obtained the policy in a fraudulent manner. Without prejudice to the contention and without admitting any liability the respondent stated that after claim intimation the respondent appointed a duly licensed IRDA surveyor who inspected the vehicle and assessed the loss. The independent IRDA Surveyor had assessed the loss to a tune of `47,757/- only. The concealment of material facts renders the contract void and as such this respondent has no liability under the insurance policy.
5. The appellant filed his affidavit and got marked Exs.A.1 to Ex.A.7. On behalf of the respondent, Srinivasan Chandran, Regional Manager, Legal filed his affidavit and Ex.B1 was marked.
6. The District Forum dismissed the complaint on the premise that the appellant concealed his claim made with the insurance company and availed no claim bonus at 20% and also availed discount of `3,063.36 and thereafter entered into contract of insurance with the respondent insurance company.
7. Being aggrieved by the order of the District Forum, the complainant has filed appeal contending that as per the terms and conditions of the letter dated 5.7.2010 there was deficiency in service on the part of the respondent and that the signature of the appellant is forged on the second page of the cover note as also that the surveyor appointed by the respondent inspected the damaged vehicle and permitted the appellant to proceed with the repairs which itself indicates that there was no suppression of material information on the part of the appellant.
8. The point for consideration is whether the order of the District Forum suffers from mis-appreciation of fact or law?
9. It is an admitted fact that the appellant insured his car bearing No.AP 16BJ 10 with M/s Bajaj Allianz Insurance Company for the period commencing from 6.4.2009 to 5.4.2010. Bajaj Allianz Insurance Company had stated to have issued renewal premium notice for `8,160/-
two months prior to the date of expiry of the insurance policy. The appellant obtained insurance policy from the respondent insurance company by paying premium of `6,143.72ps for the period of issuance from 6.4.2010 to 5.4.2011. At 9 a.m. on 4.6.2010 the appellants vehicle met with an accident at Gowraram Village.
The appellant intimated the accident to the police Chillakallu and a case in Cr.No.114 of 2010 u/s 279 of IPC was registered and the appellant informed the respondent insurance company about the accident and damaged caused to the vehicle in the accident.
10. It is not disputed that the appellant shifted the vehicle from the spot where the accident occurred to a workshop on the same day of the accident and the surveyor deputed by the respondent inspected the vehicle as also he had given permission to make repairs. The appellant lodged claim for `89,827/-
and the respondent insurance company refused to settle the claim on the ground that there was false declaration made by the appellant and that the appellant deliberately concealed the previous claim made with M/s Bajaj Allianz Insurance Company Limited and he had filed declaration with the respondent that he is eligible for no claim bonus and availed the insurance policy at discounted rate. The concealment of material fact, according to the respondent renders the contract of insurance void.
11. The declaration clause and NCB clause incorporated in the proposal form submitted by the appellant to the respondent insurance company for the purpose of obtaining the insurance policy reads as under:
I/we hereby declare that the statements, answers given by me/us in this proposal form are true to the best of my knowledge and belief. It is hereby understood and agreed that the statements, answers and particulars provided herein above are the basis on which this insurance is being granted and that if, after the insurance is effected, it is found that any of the statements, answers or particulars are incorrect or untrue in any respect, the company shall have no liability under this insurance. I/We agree and undertake to convey to Bharti AXA General Insurance Company Limited any change/alterations carried out in the risk proposed for insurance after submission of this proposal form.
I/We hereby declare that all the damages observed at the time of inspection of the vehicle shall not be claimed by me/us from Bharti AXA General Insurance Co., Ltd.
I/We declare that the rate of NCB claimed by me/us is correct and that no claim as arisen in the expiring the policy period (copy of the policy enclosed).
I/We further undertake that if this declaration is found to be incorrect, all benefits under the policy in respect of Section I of the Policy will stand forfeited.
12. The learned counsel for the appellant has contended that the District Forum has not considered the terms of the letter dated 5.7.2007 issued by the respondent insurance company. The letter reads as under:
We refer to the claim lodged with us in respect of the above mentioned vehicle.
Upon intimation of the claim on 4.6.2010, the vehicle was inspected on 7.6.2010 at Sai Swarna Automobiles Pvt Ltd., Vijayawada. During the document verification he noticed that while seeking insurance for the subject risk, you had declared the following:
1.
That you had not made any claim in the previous policy.
2. That you are eligible for NCB upon expiry of the previous policy Bajaj Allianz Insurance Company Limited your previous insurer have informed in writing that there were two claims lodged in the expiring policy.
Thus, as per provisions of Motor Insurance provided by the Insurance Regulator, you are not eligible of any NCB in the policy this year.
13. The insurance policy issued by the respondent insurance company would show that the appellant declared that he is eligible for no claim bonus and he had obtained the insurance policy for the amount arrived at on being given discount.
The appellant had availed discount to the extent of `1,914.60ps towards 20% of the premium as no claim bonus and also he had availed 40% discount to the tune of `3,063.36ps.
14. Thus the appellant concealed the material fact in regard to the claims he had made on two occasions while the previous insurance policy issued by M/s Bajaj Allianz Insurance Company Limited was in force. The contract of insurance is based on the principle of ubberma fides and the parties to the contract of insurance are obligated to be fair and not to conceal any material fact that would influence the decision of the other party in the matter relating to the issuance of insurance policy.
15. The Honble Supreme Court in Satwant Kaur Sandhu Vs New India Assurance Company Limited reported in 2009 CTJ 956 (SC) (CP) has held that:
Answers given by the proposer to the two questions were Sound Health and Nil respectively. It would be beyond anybodys comprehension that the insured was not aware of the state of his health and the fact that he was suffering from Diabetes as also chronic Renal failure, more so when he was stated to be on regular haemodialysis. There can hardly be any scope for doubt that the information required in the afore extracted questions was on material facts and answers given to those questions were definitely factors which would have influenced and guided the respondent Insurance Company to enter into the Contract of Mediclaim Insurance with the insured. It is also pertinent to note that in the claim form the appellant had stated that the deceased was suffering from Chronic Renal Failure and Diabetic Nephropathy from 1stJune, 1990, i.e. within three weeks of taking the policy. Judged from any angle, we have no hesitation in coming to the conclusion that the statement made by the insured in the proposal form as to the state of his health was palpably untrue to his knowledge. There was clear suppression of material facts in regard to the health of the insured and, therefore, the respondent insurer was fully justified in repudiating the insurance contract. We do not find any substance in the contention of learned counsel for the appellant that reliance could not be placed on the certificate obtained by the respondent from the hospital, where the insured was treated. Apart from the fact that at no stage the appellant had pleaded that the insured was not treated at Vijaya Health Centre at Chennai, where he ultimately died. It is more than clear from the said certificate that information about the medical history of the deceased must have been supplied by his family member sat the time of admission in the hospital, a normal practice in any hospital. Significantly, even the declaration in the proposal form by the proposer authorises the insurer to seek information from any hospital he had attended or may attend concerning any decease or illness which may affect his health.
16. In view of the concealment of material fact relating to the two claims lodged by him prior to the date of obtaining the insurance policy from the respondent insurance company as also in the light of the appellant availing no claim bonus and discount while obtaining the insurance policy from the respondent-insurance company on the premise of no claim under the previous insurance policy, we do not find any infirmity in the finding returned by the District Forum on the aspect of concealment of material fact by the appellant and the refusal of the respondent insurance company for settlement of the claim made by the appellant.
17. In the result, the appeal is dismissed confirming the order of the District Forum.
There shall be no order as to costs.
MEMBER MEMBER Dt.23.11.2012 KMK*