National Consumer Disputes Redressal
Life Insurance Corporation Of India vs Avdesh Chandra Upadhyaya on 11 September, 2006
Equivalent citations: IV(2006)CPJ245(NC)
ORDER
M.B. Shah, J. (President)
1. At the outset, we would observe that the terms of the policy, to a large extent, are vague. However, it is to be stated that 'Ashadeep Policy with the benefits' is floated by the LIC as a welfare measure to help those who suffer from dreaded diseases as mentioned therein, namely, open heart by-pass surgery, etc; hemo-dialysis, etc; and, cancer, etc. The whole purpose of the policy would be frustrated if the interpretation as sought by the LIC is accepted. It is also to be stated that normally the terms of the policy are to be read as they are, and, if there is any vagueness in the said terms, benefit would go in favour of the assured.
Facts:
2. Undisputedly, the son of the complainant obtained Asha Deep Policy w.e.f. 28.10.1995; maturity date of the policy is 28.10.2020; and, the premium paid is of Rs. 3,983 p.a. Before issuance of the policy, he was medically examined by the authorised Doctor of the LIC and was found fit to be insured and not suffering from any sickness or disease.
3. Suddenly, the complainant's son got some obstruction in his kidney and was admitted in the hospital on 7.9.1996 and renal dialysis was given on 18.9.1996. He, therefore, submitted a claim with the opposite party on 31st March, 1997. The claim was rejected by contending that the claim falls within exception Clause 11 (b) because the complainant has suffered disease within one year from the date of the policy.
4. Hence, Complaint No. 26 of 1998 was filed before the State Commission, Rajasthan. In that complaint, the State Commission held that a bare reading of the terms and conditions of the policy makes it clear that as per para 12(b), Benefit (B) is required to be paid to the Complainant and there is no time period. The Commission also rejected the contention of the Insurance Company that there was printing error. Complaint was partly allowed and the Insurance Company was directed to pay Rs. 1 lakh for the treatment and Rs. 50,000 for mental agony and harassment.
5. Against that order, Appeal No. 82/2000 was preferred by the L.I.C. before this Commission, but the same was dismissed as abated, as the heirs of the complainant who died on 7.11.2003, were not brought on record. Hence, the order of the State Commission on that point has become final.
6. After the death of the assured on 7.11.2003, father of the assured filed complaint No. 2 of 2004 before the State Commission Rajasthan claiming the rest of the benefits under the policy as provided under Benefit (B). That complaint was allowed. Hence, this appeal.
Submissions:
7. On behalf of the LIC learned Counsel Mr. Mehta contended that there is a printing error in the policy by mentioning para 11(b) instead of para 12(b) and paras 11 (a) and 11(c) instead of paras 12(a) and 12(c) in the clause which provides for benefit under the Clause (b).
8. For appreciating this contention, we would refer to the relevant part of the policy which is known as 'Asha Deep Policy' with profits (with accident benefit). The main part of the policy is as under:
Events on the happening of which benefits payable If the Policy is in force for full sum assured, one of the two benefits (A) or (B) defined hereinbelow will be provided subject to the conditions mentioned herein. Either of the benefits is payable only once during the term of the Policy.
Benefit (A): The sum assured with vested bonus, if any is payable in the event of the Life Assured surviving the stipulated date of maturity or at his death, if earlier.
Benefit (B): If any one of the contingencies given in para 11(b), subject however to the conditions mentioned in paras 11 (a) and 11(c) of the 'Conditions & Privileges' within referred to, occurs during the term of the Policy, then the following benefits will be available.
(i) Immediate payment of 50% of the sum assured.
(ii) Payment of balance of 50% of the sum assured along with vested bonus, if any, in the event of the Life Assured surviving the stipulated date of maturity or at his death, if earlier.
(iii) Payment of an amount equal to 10% of the sum assured, every year, commencing from the Policy anniversary falling on or immediately after the date of eligibility for Benefit (B) and ending with the policy anniversary, preceding the stipulated date of maturity or the date of death of the Life Assured, whichever is earlier,
(iv) Waiver of premiums, if any, (including accident premium) due from the policy anniversary falling on or immediately after the date of eligibility for Benefit (B).
Thereafter, the relevant terms and conditions relied in this appeal are as under:
11 (a) 11-1. Accident Benefit-Ii at any time when this Policy is in force for the full sum assured the Life Assured before the expiry of the period for which the premium is payable or before the Policy anniversary on which the age nearer birthday of the Life Assured is 70 years, whichever is earlier, is involved in an accident resulting in either permanent disability as herein after defined or death and the same is proved to the satisfaction of the Corporation, the Corporation agrees in the case of:
(a) Disability to the Life Assured: (i) to pay in monthly instalments spread over 10 years an additional sum equal to the Sum Assured under this Policy. If the Policy becomes a claim before the expiry of the said period of 10 years, the disability benefit instalments which have not fallen due will be paid along with the claim, (ii) to waive the payment of future premiums.
The maximum aggregate limit of assurance under all policies on the same life to which benefits (i) and (ii) above apply shall not in any event exceed Rs. 5,00,000 if there be more policies than one and if the total assurance exceeds Rs. 5,00,000 the benefits shall apply to the first Rs. 5,00,000 sum this assured in order of the date of the policies issued.
The waiver of premiums shall extinguish all options under this policy and also the benefits covered by Para (b) of this clause except as to such assurance. If any, as exceed the maximum aggregate limit of Rs. 5,00,000 and which have been kept in force by continued payment of premiums.
The disability above referred to must be disability which is the result of an accident and must be total and permanent and such that there is neither then not at any time thereafter any work, occupation or profession that the Life Assured can ever sufficiently do or follow to earn or obtain any wages, compensation or profit. Accidental injuries which independently of all other causes and within 120 days from the happening of such accident, result in the irrecoverable loss of the entire sight of both eyes or in the amputation of both hands at or above the wrists, or in the amputation of both feet at or above ankles, or in the amputation of one hand at or above the wrist and one foot at or above the ankle, shall also be deemed to constitute such disability.
11(b) Death of the life Assured-To pay an additional sum equal to the Sum Assured under this Policy, if the Life Assured shall sustain any bodily injury resulting solely and directly from the accident caused by outward violent and violent means and such injury shall within 120 days of its occurrence solely of directly and independently of all other causes result in death of the Life Assured. However, such additional sum payable in respect of this Policy, together with any such additional sum payable under other policies on the life of the Life Assured shall not exceed Rs. 5,00,000.
9. Learned Counsel for the appellant was not in a position to point out Clause 11(c) in the policy.
12(a) Benefit (B) of the Policy Schedule is not applicable if any of the contingencies mentioned in Para 11 (b) occurs (i) at any time on or after the date on which the risk under this Policy is commenced but before the expiry of one year reckoned from the date of this Policy of (it may be 'or) (ii) within one year from the date of revival.
12(b) Benefit (B) of the Policy Schedule is applicable on the occurrence of any of the following contingencies.
(i) The Life Assured undergoes open Heart By-Pass surgery performed on significantly narrowed/occluded coronary arteries to restore adequate blood supply to heart and the surgery must have been proven to be necessary by means of coronary angiography. All other operations (e.g. angioplasty and Thrombulysis by Coronary Artery Catheterization) are specifically excluded, or
(ii) The Life Assured undergoes Hemodialysis or Renal Transplantation as a result of an end Renal Failure presented as chronic irreversible failure of both Kidneys to function.
(iii) The life assured suffers from cancer....
OR
(iv) the life assured suffers from paralytic stroke....
12(c) Within 120 days from the date on which any of the contingencies mentioned in para 11(b) herein above has occurred, full particulars thereof must be notified in writing to the office of the Corporation.
Findings:
10. At this stage, it is to be made clear that Clause 11(a) and (b) talks of benefit only because of the accidental disabilities specified therein.
11. As against this Benefit (B) is for altogether different purposes and to give umbrella of insurance coverage to those persons who may be affected by fatal diseases.
12. In the present case, we are not concerned with the death of the life assured because of accident, as provided in Clause 11(b) quoted above nor we are concerned with the disabilities as stated therein. We are only concerned with the Benefit (B) contemplated in the main part of the policy.
13. Benefit B(i) contemplated payment of 50% of the sum assured in the case where the assured undergoes open heart by-pass surgery, etc.; hemodialysis, etc.; suffers from cancer; or, paralytic stroke. Secondly, (B)(ii)(iii) and (iv) deal with payment of balance of 59% of the sum assured along with the bonus and that payment is to be made in the event of life assured surviving the stipulated date or at his death, if earlier.
14. In the present case, we are concerned with second para of the benefit. First benefit, because of the renal dialysis in the year 1997 was given to the assured. The question is with regard to second benefit after his death. Admittedly, the policy was taken with effect from 28.10.1995; and the assured expired on 7.11.2003. Therefore, there is no question of not paying the balance 50% of the sum assured and other benefits as provided under Benefit B(iii) by contending that the assured underwent renal dialysis within a period of one year from the date on which the risk under the policy commenced as stated above. Para 12(a) only provides that Benefit B of the policy schedule is not applicable if any of the contingency mentioned in para 11 (b) occurs at any time on or after the death on which the risk under the policy is commenced but before the expiry of one year. Para 11 (b) talks of death resulting from bodily injury. That is not the question in the present case. Secondly, even if for the sake of argument if we refer para 11(b) as para 12(b) then also the death has not occurred within a period of one year from the date of the commencement of the policy.
15. However, learned Counsel Mr. Mehta for LIC submitted that as the renal dialysis was carried out within a period of one year from the date of issuance of the policy, the assured was not entitled to have 50% of the sum assured as provided under Benefit B(i). He, therefore, submitted that as the assured was not entitled to have the benefit of B(i) he is not entitled to have the benefit of B(ii) and (iii).
16. In our view, this submission is far fetched and without any substance. Firstly, with regard to payment for renal dialysis, the issue is finalised by judgment in Complaint No. 26 of 1998. That complaint was allowed and the complainant was paid 50% of the sum assured. The appeal filed by the LIC before the National Commission was abated for non-joinder of the heirs of the assured who died on 7.11.2003. Once the aforesaid amount is paid the heirs of the complainant are to be paid the benefit of Clauses B(B)(ii)(ii) and (iv) because death has occurred after a lapse of 8 years from the date of the policy.
17. Further, once the payment or eligibility for the first part is finalised between the parties it is not open to the Insurance Company now to contend that remaining 50% of the sum assured is not payable, because the deceased was first put on dialysis on 18.9.1996, i.e. within one year from the date of the policy. That dispute does not survive and decision between the parties is final and binding to them.
18. In the result, the First Appeal is dismissed. Appellant shall pay Rs. 5,000 as costs of this appeal to the Complainant.