State Consumer Disputes Redressal Commission
Seema Dugar vs Lic Of India, on 4 March, 2008
IN THE STATE COMMISSION : DELHI IN THE STATE COMMISSION : DELHI (Constituted under Section 9 clause (b) of the Consumer Protection Act, 1986 ) Date of Decision: 04-03-2008 Complaint Case No.C-215/1999 Smt. Seema Dugar - Complainant. W/o Late Sh. Mahendra Kr Dugar, Through R/o 28, South Patel Nagar, Mr. Sanjay Luthra, New Delhi-1100 08. Advocate. Versus 1. The Branch Manager, - Opposite Party No.1 LIC of India, Through Branch Unit NO.19G, Mr. M.N. Singh, Near Dream Light Cinema, Advocate. P.O. Sujangarh, Post Box No.51, Distt. Churu-331507 (Rajasthan), 2. The Branch Manager, - Opposite Party No.2 LIC of India, Branch Unit No.11-U, Sector-11, Mathura Road, Faridabad (Harayana). 3. The Zonal Manager, - Opposite Party No.3 LIC of India, Northern Zonal Office, Jeevan Bharti Building, Post Box No.630, Connaught Circus New Delhi-1100 01. CORAM: Mr. Justice J.D.Kapoor President Ms Rumnita Mittal Member
1. Whether reporters of local newspapers be allowed to see the judgment?
1. To be referred to the Reporter or not?
JUSTICE J.D. KAPOOR, PRESIDENT (ORAL) Husband of the complainant late Sh.
Mahender Kumar Dugar purchased three insurance policies No.500175377, 500176999 and 500178888 for Rs. one lac each from OP-1, L.I.C. of India, Churu (Rajsthan) and one policy NO.120248121 from OP-2 at Faridaband For Rs.50,000/-. Complainant is the nominee in all these polices. The insured died on 04.09.1995 and the complainant lodged the claims with the OPs. However, the OPs released the amount of Rs.1,10.645/- after a long period of 19 months only in respect of one policy No.500178888 and the OP company deducted the premium of Rs.2755/- which was due on 15.09.1995 though the insured had died on 04.05.1995. Claim against the remaining three polices was repudiated by the OP company and only an ex-gratia payment of Rs. 1 lac was offered. Hence the complaint seeking the insured amount with bonus against the three polices besides the not due premium and interest etc.
2. According to the OPs two polices No.500175377 and 500176999 taken from OP-1 lapsed due to non-payment of the premium and same were got revived by the insured on 16.08.1995 after filing the declaration of good health. At the time of processing the claim, the OP company found that it was an early claim because the insured had died within 19 days of the revival of the two policies above mentioned and within 8 months of taking policy NO.120228121 from OP-2.
3. Hence investigation was carried out and it was found that about 12 months before the insured had revived the lapsed polices, he was suffering from UGI bleed, hyper kalemia, alcoholic cirrhosis and portal hypertension for which he was treated at AIIMS. The insured did not disclose this fact while getting the lapsed polices revived and taking the policy from the Faridabad branch of the company. Hence, the claim is respect of the three polices was repudiated by the company. However, an ex-gratia payment of Rs. one lac was sanctioned and paid to complainant against these three polices on humanitarian ground. As to honouring the remaining one policy, it is stated that the insured did not know about these diseases at the time of taking the policy and hence payment in respect of this policy was made. It has been denied that any premium, which was not due, was deducted from the claim. OP s have also raised the plea of territorial jurisdiction as none of the polices was taken from Delhi.
4. In her rejoinder the complainant has denied that the insured was suffering from the diseases mentioned earlier and was treated at AIIMS as alleged. Ex-gratia payment of Rs. 1 lac has also been denied. As to the territorial jurisdiction, it is stated that OP-3 is the zonal office of the company at Delhi and hence this Commission has the territorial jurisdiction in the matter.
5. Parties have filed their evidence by way of affidavits.
6. We have heard the counsel for the parties at length and accorded careful consideration to the rival claims and contentions. The first and foremost objection raised by the learned counsel for the OP is territorial jurisdiction of this Commission in as much as that out of three policies two were taken at Churu, Rajasthan and one at Faridabad. However, in view of the fact that complainant was asked to settle her claim at Delhi office of the OP and they had been corresponding with Delhi office alone the jurisdiction at Delhi is available to the complainant. Even otherwise section 11 of the Consumer Protection Act, 1986 relating to jurisdiction of the District Forum allows the complainant to institute a complaint in a District Forum within the local limits of whose jurisdiction the OP or each of the OPs, where there are more than one, at the time of institution of the complaint, actually and voluntarily resides or carries on business or has a branch office or personally works for gain or where the cause of action wholly or in part arises. Section 11 reads as under:-
11. Jurisdiction of the District Forum.- (1) Subject to the other provisions of this Act, the District Forum shall have jurisdiction to entertain complaints where the value of the goods or services and the compensation, if any, claimed does not exceed rupees twenty lakhs.
(2) A complaint shall be instituted in a District Forum within the local limits of whose jurisdiction, -
(a) the opposite party or each of the opposite parties, where there are more than one, at the time of the institution of the complaint, actually and voluntarily resides or carries on business or has a branch office or personally works for gain, or
(b) any of the opposite parties, where there are more than one, at the time of the institution of the complaint, actually and voluntarily resides, or carries on business or has a branch office or personally works for gain, provided that in such case either the permission of the District Forum is given, or the opposite parties who do not reside, or carry on business or have a branch office, or personally work for gain as the case may be, acquiesce in such institution, or
(c) the cause of action, wholly or in part, arises.
7. In the instant case cause of action partly arose in Delhi because of the jurisdiction of the OP asking the complainant to settle all her claim with the Delhi office and secondly that OP has a branch office in Delhi and the concept of territorial jurisdiction is ordinarily for the benefit of the aggrieved party. Therefore, every provision of the Act including the jurisdiction has to be provided and receive a beneficiary interpretation and any interpretation goes in favour of the consumer has to be accepted and acted upon. As per section 11 the territorial jurisdiction is available where partly or wholly cause of action arises where the opposite parties Head Office or Branch Office ordinarily works for gain. Since both elements are existing in the instant case, the objection raised by the OP holds no water.
8. On merits the learned counsel for the OP contended that two of the insurance policies were lying lapsed due to non payment of the premium and same were got revived on 16-08-1995 after filling up the declaration of the good health and at the time of processing the claim the OP-Company found that it was an early claim because the insured had died within 19 days of the revival of the two policies whereas third policy was obtained by the complainant about eight months prior to his death. It is further contended that the complainant concealed the factum of his suffering from hyper kalemia, alcoholic cirrhosis and portal hypertension for which he had treated at AIIMS.
9. In such type of cases we have taken a view that unless and until an insured is hospitalized and undergone operation in the near proximity, say six months or one year prior to obtaining of the insurance policy and diseases which are common malaise of the modern life and are controllable on day to day basis and need only medication are not such diseases which should be disclosed in the proposal form for insurance claim as the insured attends to normal and daily chores like any other healthy person nor such disease fall within the nomenclature of pre-existing disease. Some of our conclusions in such like cases are as under :-
(i) Disease means a serious derangement of health or chronic deep-seated disease frequently one that is ultimately fatal for which an insured must have been hospitalized or operated upon in the near proximity of obtaining the mediclaim policy.
(ii) Such a disease should not only be existing at the time of taking the policy but also should have existed in the near proximity.
If the insured had been hospitalized or operated upon for the said disease in the near past, say, six months or a year he is supposed to disclose the said fact to rule out the failure of his claim on the ground of concealment of information as to pre-existing disease.
(iii) Malaise of hypertension, diabetes, occasional pain, cold, headache, arthritis and the like in the body are normal wear and tear of modern day life which is full of tension at the place of work, in and out of the house and are controllable on day to day basis by standard medication and cannot be used as concealment of pre-existing disease for repudiation of the insurance claim unless an insured in the near proximity of taking of the policy is hospitalized or operated upon for the treatment of these diseases or any other disease.
(iv) If insured had been even otherwise living normal and healthy life and attending to his duties and daily chores like any other person and is not declared as a diseased person as referred above he cannot be held guilty for concealment of any disease, the medical terminology of which is even not known to an educated person unless he is hospitalized and operated upon for a particular disease in the near proximity of date of insurance policy say few days or months.
(v) Disease that can be easily detected by subjecting the insured to basic tests like blood test, ECG etc. the insured is not supposed to disclose such disease because of otherwise leading a normal and healthy life and cannot be branded as diseased person.
(vi) Insurance Company cannot take advantage of its act of omission and commission as it is under obligation to ensure before issuing medi-claim policy whether a person is fit to be insured or not. It appears that insurance Companies dont discharge this obligation as half of the population is suffering from such malaises and they would be left with no or very little business.
Thus any attempt on the part of the insurer to repudiate the claim for such non-disclosure is not permissible, nor is exclusion clause invokable.
(vii) Claim of any insured should not be and cannot be repudiated by taking a clue or remote reference to any so-called disease from the discharge summary of the insured by invoking the exclusion clause or non-disclosure of pre-existing disease unless the insured had concealed his hospitalization or operation for the said disease undertaken in the reasonable near proximity as referred above.
(viii) Day to day history or history of several years of some or the other physical problem one may face occasionally without having landed for hospitalization or operation for the disease cannot be used for repudiating the claim. For instance an insured had suffered from a particular disease for which he was hospitalised or operated upon 5, 10 to 20 years ago and since then had been living healthy and normal life cannot be accused of concealment of pre-existing disease while taking mediclaim policy as after being cured of the disease, he does not suffer from any disease much less the pre-existing disease.
(ix) For instance, to say that insured has concealed the fact that he was having pain in the chest off and on for years but has never been diagnosed or operated upon for heart disease but suddenly lands up in the hospital for the said purpose and therefore is disentitled for claim bares dubious design of the insurer to defeat the rightful claim of the insured on flimsy ground. Instances are not rare where people suffer a massive attack without having even been hospitalised or operated upon at any age say for 20 years or so.
(x) Non-disclosure of hospitalization/or operation for disease that too in the reasonable proximity of the date of mediclaim policy is the only ground on which insured claim can be repudiated and on no other ground.
10. Though the lapsed policies were revived on 16-08-1995 yet the complainant did not declare as to his health being sound and good as the proposal form was filled afresh. Revival of policy is always with retrospective effect i.e. in continuation of the lapsed policy. But at the same time the insured is also required to give declaration as to his health. The declaration given by him at the time of obtaining the policy is not relevant.
11. Thus in our view policies which were lapsed and revived and within 90 days the deceased died makes out a case of concealment of facts by the complainant as to the state of his health, particularly when the cause of death has been liver cirrhosis and portal hypertension, hyper kalemia, UGI bleed etc.
12. As regards the policy obtained eight months prior to the death of the deceased neither he had been hospitalized and received treatment nor he had undergone any operation and therefore the claim of the complainant in respect of the policy obtained eight months prior to the death of the deceased was wrongly repudiated. It is contended by the counsel for the OP that the OP had offered Rs. 1 lac as ex gratia payment to the complainant which was not accepted by the complainant.
13. In the result we allow the complaint in the following terms:-
(i) OP shall pay Rs. 50,000/- in respect of the policy which was obtained eight months prior to the death of the deceased with 9 % interest from the date of filing of the complaint till the date of this order.
(ii) OP shall pay Rs. 80,000/- towards other two policies which were Rs. 40,000/- each.
(iii) OP shall pay Rs. 25,000/- as compensation for mental agony and harassment suffered by the complainant besides Rs. 10,000/- towards litigation expenses.
14. Aforesaid payment shall be made within one month from the date of receipt of this order.
15. Complaint is disposed of in aforesaid terms.
16. A copy of the order as per the statutory requirements be forwarded to the parties free of charge and thereafter the file be consigned to Record Room.
17. Announced on 4th March, 2008.
(Justice J.D. Kapoor) President (Rumnita Mittal) Member jj