State Consumer Disputes Redressal Commission
Senior Divisional Manager,Lic Of ... vs S.Dayanidhi,Bodinayakanoor. on 9 February, 2022
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IN THE CIRCUIT BENCH OF THE TAMILNADU STATE CONSUMER DISPUTES
REDRESSAL COMMISSION, MADURAI.
Present: THIRU.N. RAJASEKAR, PRESIDING JUDICIAL MEMBER
F.A.No.165/2013
(Against the order made in C.C.No.21/2007 dated 08.08.2011 on the file of
the District Forum, Madurai.)
WEDNESDAY, THE 09th DAY OF FEBRUARY 2022
The Life Insurance Corporation of India,
Through Senior Divisional Manager,
Divisional Office,
„Jeevan Prakahs‟
Palam Station Road,
Sellur (Post Box 16),
Madurai-2. Appellant/Opposite Party
-Vs-
Thiru.S.Dayanidhi,
32/16, China Boyan Street,
Thirumalapuram,
Bodinayakanoor. Respondent/Complainant
Counsel for the Appellant/Opposite party : Mr.K.K.Kannan, Advocate.
Counsel for Respondent/Complainant : M/s.M.P.Senthil, Advocate.
This appeal coming before us for final hearing on 01.11.2021 and on
perusing the material records, this Commission made the following:-
ORDER
THIRU.N. RAJASEKAR, PRESIDING JUDICIAL MEMBER.
1. This appeal has been filed by the appellant/opposite party under section 15 read with section 17(1) (a) (ii) of the Consumer Protection Act, 1986 against the 2 order of the learned District Forum, Madurai made in C.C.No.21/2007, dated 08.08.2011, allowing the complaint.
2. For the sake of convenience and brevity, the parties are referred to here as they stood arrayed in the District Consumer Disputes Redresssal Forum Madurai.
3. The opposite party, suffering by an order directing the opposite party to grant proper compensation for which the complainant is entitled, after verifying the legal heirship of the complainant. Further the opposite party is directed to pay Rs.5000/- as compensation for mental agony and deficiency of service with interest at the rate of 8% per annum from the date of complaint and to pay Rs.3000/- towards cost to the complainant in the hands of the learned District Consumer Disputes Redressal Forum, Madurai (hereinafter referred to as District Forum), has preferred this appeal before this Commission.
4. The case of the complainant is as follows:- The complainant is the son of deceased S. Pushpam Ammal. The said Pushpam Ammal had insured her life for a sum of Rs.5 lakhs in Policy No.743650719 dated 28.03.2004 with the opposite party corporation. The period covered under the above said Insurance Policy was for a period of 19 years from the date of the said policy. In pursuance of the above said Insurance policy the deceased S.Pushpam Ammal had paid the first annual premium of Rs.38,317/- on 28.03.2004. S.Pushpam Ammal suddenly become ill and she was admitted for blood vomiting on 28.02.2005 into Vadamalayan Hospital. However inspite of the administration of best medical care and treatment, she died on 02.03.2005 at about 4.10 a.m. The said S.Pushpam Ammal had passed away on 02.03.2005 leaving the complainant alone as her only son to be succeeded to her estate which includes the policy amount of Rs.5,00,000/-. Apart from that the 3 complainant is the nominee shown in the above said policy by his deceased mother S.Pushpam Ammal. The complainant submitted a claim petition in claim form No.3783 A-04-05-87 to the opposite party's office. The opposite party had sent a reply on 30.12.2005 repudiating the claim of the complainant. The Zonal Manager also refused to reconsider the claims of the complainant. In the reply letter dated 30.12.2005 they had stated that they are repudiating the claim of the complainant on the ground that the complainant's deceased mother was suffering from diabetes mellitus and Hypertension for three years prior to the Insurance of the policy and had undergone Hysterectomy surgery for about ten years back and the deceased policy holder Pushpam Ammal had not disclosed the above particulars in the proposal form and suppressed the said facts. Repudiation is not proper, legal and valid under law. In fact the questions contained in the proposal form was filled up in English language either by the said authorized agent or some of the officers in the opposite party's office. In fact the complainant's mother, the deceased S.Pushpam Ammal had not suppressed any facts. The complainant's mother was suddenly attacked with diabetes it was not for any reason such as diabetes Mellitus or Hypertension as alleged by the opposite party in their repudiation letter. As long as the death was not due to and by the Diabetes Mellitus and Hypertension, the opposite party is not entitled to repudiate the claim under the Insurance Policy. The complainant issued a lawyer notice to the opposite party on 20.11.2006. Therefore, the complainant prays to direct the opposite party to pay Rs.5,00,000/- being the policy amount together with interest at 18% from date of repudiation to till the date of payment, and to pay Rs.1,02,000/- towards compensation and cost of this complaint.
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5. Written version filed by the opposite party is as follows;- Pushpam Ammal (Life assured) was under treatment at Vadamalayan Hospital, Madurai for diabetic for three years and underwent hysterectomy before 10 years (I.P.No.4551/
04). The proposal for assurance signed by the deceased on 30.03.2004. She had answered the questions falsely. All the answers were false as she was not maintaining good health and was suffering from Diabetes Mellitus and Hypertension for 3 years and also underwent Hysterectomy 10 years back and took medical treatment before proposing her life for assurance. Hence the provisions of Section 45 of the insurance Act is also applicable. After making investigation only the claim was repudiated on 30.12.2005 for the reason of suppression of material facts. There is no deficiency of service on the part of LIC and its officials. Suppression of material informations regarding health is fatal. Specific questions are asked in the proposal form regarding Diabetes and Hypertension. The Life assured has answered as „No‟. But infact she was suffering from Diabetes and Hypertension. As such the complaint should be dismissed with cost.
6. The Leaned District Forum, after taking into account of the evidences adduced by both parties, had held that the repudiation of the claim raised by the complainant amounts deficiency in service passed an order in favour of the complainant directing the opposite party to grant proper compensation for which the complainant is entitled, after verifying the legal heirship of the complainant. Further the opposite party is directed to pay Rs.5000/- as compensation for mental agony and deficiency of service with interest at the rate of 8% per annum from the date of complaint and to pay Rs.3000/- towards cost to the complainant. 5
7. Being aggrieved against that order the opposite party challenged it by filing the appeal stating that all insurance policies are issued based on Uberrima fides meaning "utmost good faith". The insured while taking up the policy with the appellant has suppressed material facts in the proposal form about his health condition, as such the insured or his legal representatives have got no right to claim benefit under a policy obtained by them by false declaration and suppression of material facts to the insurer. It is a well settled law that the proposer of the insurance policy has to furnish all the informations sought for by the insurance company and has to give correct answers for the questions contained in the proposal form and as held by the Hon‟ble Supreme Court in Satwant Kaur Sandhu - Vs- New India Assurance 2009 IV CPJ 8 (SC) that "it is not for the proposer to determine whether the information sought for is material for the purpose of the policy or not. It is further held that any inaccurate answer to the questions in the proposal form, if the life assured had knowledge thereof, 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".
8. On the side of respondent/complainant no additional documents were marked in the appeal. On the side of the appellant/opposite party additional document were marked as Ex.B1 & B2 in the appeal.
9. Point for consideration is:
Whether the order passed by the Learned District Forum, Madurai in C.C.No.21/2007 dated 08.08.2011 is sustainable under law or not? 6
10. Point: The complainant‟s mother S.Pushpam Ammal insured her life for a sum of Rs.5,00,000/- in policy No.743650719 on 28.03.2004 with the opposite party. The period covered under the above policy was fixed for 19 years. The first annual premium of Rs.38,317/- was paid on 28.03.2004. The above S.Pushpam Ammal suddenly become ill and she was vomiting blood on 28.02.2005 and admitted in vadamalayan Hospital. Inspite of the best medical care and treatment, she died on 02.03.2005 at about 4.10 a.m. The complainant is the only son submitted claim petition to the opposite party they have repudiated the claim on 30.12.2005, on the ground that the complainant‟s deceased mother was suffering from diabetes mellitus and Hypertension for three years prior to the date of taking insurance policy and had undergone Hysterectomy surgery for about ten years back and had not disclosed the above particulars in the proposal form and suppressed those facts.
11. The counsel for the appellant would contend that the deceased Pushpam Ammal not only suppressed the vital information regarding health particulars but also gave wrong answers in the proposal form. The Hon‟ble Supreme Court had held in - PC.Chacko and another -Vs- Chairman, LIC of India reported in III (2008) CPJ 78 SC - "It was not necessary for the insurer to establish the suppression was fraudulently made by the policy holder or that he must have been aware at the time of making the statement that the same was false or that the fact was suppressed which was material to disclose. A deliberate wrong answer which has a great bearing on the contract of Insurance, if discovered may lead to the policy being vitiated in law".
12. The counsel for the respondent/complainant represented that such type of objections raised by the insurance company were totally over ruled and rejected by 7 several High Courts under several Judgements by relying upon following the citations:-
(1) Volume II (1996) CPJ 528, the Karnataka State Disputes Redressal Commission.
(2) Volume II (1996) CPJ 92, the Gujarat State Consumer Disputes Redressal Commission.
(3) Volume II (1993) CPJ 1087, West Bengal State Consumer Disputes Redressal Commission, Calcutta.
(4) Volume III (1996) CPJ 136 (NC), National Consumer Disputes Redress Commission, New Delhi.
(5) Volume I (1994) CPJ 319, Maharastra State Consumer Disputes Redressal Commission, Bombay.
(6) Volume I (1994) CPJ 493, Bihar State Consumer Disputes Redressal Commission, Patna.
(7) Order passed by this Circuit Bench, Madurai in F.A.No.573/2012 dated 11.06.2015 - in the case of - The Senior Branch Manager, LIC and another -Vs- Avyline Ammal and another.
The above citations are not relevant to the present appeal.
13. Since "Material Fact" - material fact has not been defined in the insurance act it was held by the the Hon‟ble National Consumer Disputes Redressal Commission, in the case of Bajaj Allianz Life Insurance Company & Ors -Vs- Jaspal Kaur - MANU/CF/0633/2016 (NC), that is understood to mean any fact which would influence the judgement of a prudent insurer in fixing the premium or determining whether he would like to accept the risk, in fact which goes to the root of the Contract of Insurance and has bearing on the risk 8 involved would be material. For determination of the question whether there is suppression of any material facts, it is necessary to examine the policy so as to verify whether the suppression relates to the facts which is in the exclusive knowledge of the person intending to take the policy and it could not be ascertained by reasonable enquiry by a prudent man.
14. The deceased insured was died within 11 months after taking the policy. The insured was admitted in hospital a condition of blood vomiting and hypertension on 28.02.2005 and died on 02.03.2005. The complainant admits in his complaint that, his mother was suddenly suffered with diabetes it was not for any reason such as diabetes mellitus or Hypertension we need not to consider nexus between the cause of death and disease for deciding the question of suppression of material fact. Whether the insured suppressed any ailments at the time of taking the policy alone is to be considered. In Ex.A8 pre suit notice issued on behalf of the complainant to the opposite party in para 11 it was explained that the complainant‟s deceased mother was an illiterate lady taken the insurance policy through her authorised agent and also undergone the medical test. The contents of proposal form not read over and obtained her signature. The proposal form was filled up in language of English. The deceased insured had not suppressed any facts in the matter of her health nor with held any information regarding her health wantonly. She was suddenly attacked with diabetes and insufficiency of the supply of insulin, in her blood at the time of treatment. The reason for her death was Cardio Respiratory Arrest and it was not for any reason due to any of diabetes mellitus or hypertension as alleged in the repudiation letter and also alleged that assuming without admitting that the deceased Pushpam Ammal was having any diabetes mellitus or hypertension at the time of entering into an insurance policy. The same will not amount to suppression of any material facts for repudiating the claim. It is the duty of the insurer to prove the ailments of the insured at the time of taking the policy for proving those facts.
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15. The appellant/opposite party marked two additional documents in Ex.B1 & B2. The Ex.B1 is the medical records maintained at Vadamalayan Hospital, Madurai. In the admission records it was mentioned by the Medical Officer "Past History" - Known diabetic for past three years on insulin now underwent hysterectomy 10 years above. The Ex.B2 is the xerox copy of proposal form the insured declared in the proposal form for the question No.11- (e) Are you suffering from or have you ever suffered from Diabetes, Tuberculosis, High Blood Pressure, Low Blood Pressure, Cancer, Epilepsy, Hernia, Hydrocele, Leprosy or any other disease? - "NO". (i) What has been your usual state of health? - "GOOD".
16. As per the Ex.B1 there is an entries found that the insured was suffering with diabetic for past three years at the time of admission in the hospital. The complainant‟s mother taken the policy on 28.03.2004 and admitted in the hospital on 28.02.2005 the entry found place in Ex.B1 is proves the complainant‟s mother was suffering with diabetic for past three years at the time of taking the policy it was suppressed by her in the proposal form, and also answered as her health condition is in „Good‟ the above two answers shows the suppression of ailments at the time of taking the policy. The opposite party prove the insured suppressed the material fact at the time of taking the policy.
17. A deliberate wrong answer which has a great bearing on the contract of Insurance, if discovered may lead to the policy being vitiated in law". Therefore repudiation of the claim by the opposite party not amounts to deficiency in service as held by the Learned District Forum.
18. The Learned District Forum only came to a wrong conclusion on the basis of records available before it, now the opposite party produced the additional documents in Ex.B1 & B2 which could not be produced before the District Forum to proves the repudiation is within the terms of insurance contract. When the opposite party able to prove the repudiation is within the terms they have discharged their 10 burden to prove the repudiation is valid when the repudiation is valid it does not amounts to deficiency of service on the part of the opposite party. Therefore, the order passed by the Learned District Forum is not sustainable under law and answered accordingly for the point for consideration.
19. In the result, the appeal is allowed by setting aside the order of the learned District Consumer Disputes Redressal Forum, Madurai made in C.C.No.21/2007, dated 08.08.2011 and the complaint is dismissed. There shall be no order as to costs in this appeal.
The Registry is directed to refund the mandatory deposit to the appellant/opposite party with accrued interest therein duly discharged in favour of the appellant/opposite party.
Dictated to the Steno-typist transcribed and typed by her corrected and pronounced by me on this the 09th day of February 2022.
Sd/-xxxxxxx N. RAJASEKAR, PRESIDING JUDICIAL MEMBER.
Additional of Documents filed before this Commission on the side of the appellant/opposite party.
Ex.B1 05.08.2005 Case Sheet copy of Mrs.Pushpam (The insured)
Ex.B2 31.03.2004 Xerox copy of proposal form.
Sd/-xxxxxxx
N. RAJASEKAR,
PRESIDING JUDICIAL MEMBER.
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