State Consumer Disputes Redressal Commission
Aegon Life Insurance Co. Ltd. vs Praveen Kumar Sharma on 8 February, 2023
FA NO./512/2016 D.O.D.:08.02.2023
AEGON LIFE INSURANCE CO.LTD. V. MR. PRAVEEN KUMAR SHARMA
IN THE DELHI STATE CONSUMER DISPUTES REDRESSAL
COMMISSION
Date of Institution: 01.11.2016
Date of hearing: 27.10.2022
Date of Decision: 08.02.2023
FIRST APPEAL NO.- 512/2016
IN THE MATTER OF
AEGON LIFE INSURANCE CO. LTD.
THROUGH ITS AUTHORISED SIGNATORY,
HAVING ITS REGISTERED OFFICE AT:
BUILDING NO. 3, 3RD FLOOR,
UNIT NO.1, NESCO IT PARK,
WESTERN EXPRESS HIGHWAY,
GOREGAON (EAST), MUMBAI 400063.
(Through: Pristine Councilors, Advocates & Solicitors)
...Appellant
VERSUS
MR. PRAVEEN KUMAR SHARMA,
S/O MR. RAM NIWAS SHARMA,
G-1/1192,
MANSAROVER PARK,
SHAHDARA, DELHI - 110032.
...Respondent
DISMISSED PAGE 1 OF 14
FA NO./512/2016 D.O.D.:08.02.2023
AEGON LIFE INSURANCE CO.LTD. V. MR. PRAVEEN KUMAR SHARMA
CORAM:
HON'BLE JUSTICE SANGITA DHINGRA SEHGAL
(PRESIDENT)
HON'BLE MS. PINKI, MEMBER (JUDICIAL)
Present: None for the appellant.
Mr. Sanjay Kumar, counsel for the respondent.
Mr. Praveen Kumar Sharma in person.
PER: HON'BLE JUSTICE SANGITA DHINGRA SEHGAL
PRESIDENT
JUDGMENT
1. The facts of the case as per the District Commission record are:
"1. As per complaint complainant is a bonafide purchaser of three policies vide Policy no. 101212910477 dated 03.01.2011 for sum assured of Rs. 3,00,000/- (Rupees Three lac only) with critical illness rider of same amount, policy no. 110112916679 dated 07.01.2011 with sum assured Rs. 4,00,000/- (Rupee Four Lac only) with critical illness rider of same amount and policy no. 610090015232 dated 20.09.2010 with sum assured Rs. 9,80,000/- (Rupees Nine Lac Eight Thousand only) with critical illness rider of Rs.one lac. Prior to issuance of the policies the underwriter of OP got conducted full body medical examination with blood and urine tests of life assured at their own medical centre i.e. Chandan Health Care, Dilshad Garden, Delhi. As per medical examination at the time of issuing of policies the insured was quite healthy. Thereafter, OPs are accepting all the renewal premiums every year against above said policies.
2. In September 2013, complainant was diagnosed as Chronic Kidney Disease (CKD) patient. Information, thereof, was sent by complainant to OPs in October. Complainant further intimated the same on 15.11.2013. On 19.11.2013 complainant has also intimated the OPs about this disease in specified form alongwith all treatment documents. After treatment on 26.02.2014 complainant lodged a critical illness claim in specified format to the OPs DISMISSED PAGE 2 OF 14 FA NO./512/2016 D.O.D.:08.02.2023 AEGON LIFE INSURANCE CO.LTD. V. MR. PRAVEEN KUMAR SHARMA but OPs inspite of granting the same, has rejected the claim, further forfeiting all the premium paid in respect of that policy, vide letter dated 12.03.2014. As per this rejection letter OPs have declined the claim of complainant as invalid and the policy being rendered null & void. Complainant replied to letter of rejection vide his letter dated 31.03.2014 duly received in the office of OP2 on 01.04.2014. By way of his reply complainant has explained that he has provided all the information to OPs employee with his best knowledge and belief as required by OPs and OPs have issued the policy after considering each and everything. But OPs have not responded to this letter of complainant. And till now OPs are silent and not responding. Complainant has prayed for award of Rs. 8 lac towards his claim with interest @ 18% per annum in a sum of Rs. 24,000/- and compensation of Rs. 4 lac besides litigation expenses of Rs. 50,000/-. Total being Rs. 12.74 lac with further interest of 18% p.a."
2. The District Commission after taking into consideration the material available on record passed the order dated 23.04.2016, whereby it held as under:
"main question to determine is as to whether insured was having Chronic Kidney Disease at the time of proposal for the insurance policies in question or not? If so, whether insured was having knowledge of disease and he intentionally and deliberately concealed the same with malafide intentions of getting the said policies or not?
8. Admittedly, as per policy in case of concealment of material facts insured loses his right to claim the insured amount. Complainant states (i) that he was not having such disease while applying for policies. The policies were issued after Panel Doctor of OP namely Chandan Health Care medically examined him and found him fit. It was only thereafter that the policy was issued. Not only this the same were also renewed by OP finding complainant medically fit for the same.
9. Only defence raised by OP is that Chronic Kidney Disease could not take place overnight and complainant had falsely stated in his proposal form that he has no such disease. Examination of insured by its panel doctor is not disputed by the OP. Only explanation OP has given is that the doctor DISMISSED PAGE 3 OF 14 FA NO./512/2016 D.O.D.:08.02.2023 AEGON LIFE INSURANCE CO.LTD. V. MR. PRAVEEN KUMAR SHARMA asked questionnaires from complainant, answers whereof were believed by the doctor as correct. Full body examination by the panel Doctor with blood & urine test as stated by complainant is not specifically denied by OP. Now to decide the veracity of both the parties crucial evidence is medical treatment record.
10. Perusal of treatment record shows that on 30.08.2013 the insured was checked in Swamy Dayanand Hospital, where from he was referred to Nephrology Department of AIMS. In AIIMS insured was registered on 9.9.2013 and certain tests were done and on 04.11.2013 AIMS finally diagnosed Chronic Kidney Disease to the insured. Regarding detection of the disease in question and past history of complainant Ex. CW 1/4 contains statements of physician who attended critical illness, certificate of treatment by Max Super Speciality Hospital, where the insured was finally treated and certificate issued by Dr. Sumitra Bagchi of AlIMS.
11. As per attending physician statement first symptom of this disease was shown on 26.08.2013 while there was no past history thereof and it was first diagnosed by AlIMS on 30.09.2013. Hospital treatment also certified that it was diagnosed on 30.09.2013 in AIMS. The same is further confirmed by certificate of Dr. Bagchi of AIlMS.
12. OP has not filed any document in support of its contention that the Chronic Kedney Disease was pre existing at the time of proposal what to call knowledge of the same to the Insured and complainant intentionally concealing the same.
13. Thus, it is established that there was, no pre existing Chronic Kedney Disease to the insured and there is no suppression or concealment of any material fact on part of complainant/ insured or any false statement on his part. In support of his claim complainant has placed on record an order passed by Hon'ble National Commission titled Manager, Bajaj Alliance Life Insurance Company Ltd Vs Raj Kumar passed on 01.05.2014 in Revision Petition No. 1318 of 2014, whereby it has been held that in case there is no proof that Insured was having particular disease, while he submitted Proposal Form, it can't be presumed that the insured was DISMISSED PAGE 4 OF 14 FA NO./512/2016 D.O.D.:08.02.2023 AEGON LIFE INSURANCE CO.LTD. V. MR. PRAVEEN KUMAR SHARMA aware of the ailment and concealed the same. In this case it is also observed by Hon'ble National Commission that usualy the authorised doctor of Insurance Company examines the insured, assesses the fitness and after complete satisfaction then only the policy will be issued. Section 45 of Insurance Act has also been pleaded by complainant which specifically says that two years is the time limit to raise objection, if any false statement is found, by the Insurer. After that it has to be proved that Insured was having knowledge of the disease and he fraudulently concealed or mis-represented the same which OP has failed to prove.
14. OP referred P.C. Chacko and another V/s Chairman, Life Insurance of India & others, 2007 (13) scale 329 wherein Hon'ble Supreme Court has dealt with an operation conducted to the insured four years prior to the proposal. In that case, there is deliberate concealment of the fact of operation which was well within insured's knowledge. Another case referred by OP is Haji Ahmed Yar Khan Vs Abdul Gani (AIR 1937 Nag 270 at 272) passed by Hon'ble High court which deals only obligation of insured to disclose all material facts which were within his knowledge at the time of proposal. This case is not applicable as Chronic Kedney Disease was not even existing on proposal. What to call knowledge thereof. Another case referred as Satwant Kaur Sandhu V/s New India Assurance Co. Ltd. (2009) 7 SCC 316 also fixes the obligation of the insured to disclose information if within his knowledge. This case is also not applicable as no existence/ knowledge of CKD is proved by OP. Similarly M/s. Seemax Construction Pvt Ltd. V/s SBI, AiR 1992 (Delhi) 197, also deals with suppression of material facts which were very much within his knowledge. Similarly, S.P. Chengalvarya Naidu V/s Jagnnath, AIR (1994) SC 853 is case where insured found withholding the vital documents and suppression of material facts within his possession and knowledge. Hence insured was held guilty for fraud. This case is not applicable as no possession of vital document or suppression of material facts to which insured might have knowledge, is proved. OP has also referred Dineshbhal Chandrana V/s Life Insurance Corporation and another decided by Hon'ble National Commission in 242(2006) on 27.04.2006 wherein it has been observed that DISMISSED PAGE 5 OF 14 FA NO./512/2016 D.O.D.:08.02.2023 AEGON LIFE INSURANCE CO.LTD. V. MR. PRAVEEN KUMAR SHARMA when an information on a specific aspect is asked for in the proposal form, an assured is under solemn obligation to make a true and full disclosure of the information on the subiect which is within his knowledge. Here also knowledge is a precondition. Thus, it is not applicable. Another case referred by OP is Bamdev Vs United India Insurance Co. Ltd., I (1994) CPJ 425 wherein it has been held that where the repudiation of any claim is ordered after due application of mind and on valid reasons, it does not amount to deficiency of service. But as OP has failed to prove that it applied its mind to find out and relevant grounds before rejecting the claim this case is also not applicable in the present case. Another matter referred is New India Assurance Co. Ltd. V/s Pradeep Kumar, I (1997) CPJ 94 wherein Jurisdiction of Forum was held barred as insured failed to show any deficiency of service on the part of insurer. In the present case OP has failed to not establish the existence of Chronic Kidney Disease on proposal form and / or knowledge thereof. This amounts deficiency. Hence, this case is also not applicable in the present case. OP has also referred section 19 of Contract Act and Sita Holiday Resorts Limited V/s M/s Mohan Lal Harbans Lal Bhayana and Co. (1999-3) 123 P.L.R.D. 28, both of these deals with fraud and mis-representation. As per definition of these two knowledge and existence of the disease and its concealment is a pre condition to prove the same, which OP has failed to prove.
15.Taking all the cases and the sections of Contract Act and the Insurance Act as well as evidence placed on record complainant successfully established his case that he was not having the Chronic Kidney Disease in question at the time of proposal. While OP has failed to establish Chronic Kidney Disease and / or knowledge and concealment of the same. OP's plea of condition precedent for being entitled under critical illness rider complainant fulfilled all the conditions of clause A-6, A-7 & A-7.4.
16. On the basis of above findings we are of the considered view that the clause 2.4 of the policy as well as the section 45 of Insurance Act and the cases referred by OP are not applicable in the present case. Consequently he has not DISMISSED PAGE 6 OF 14 FA NO./512/2016 D.O.D.:08.02.2023 AEGON LIFE INSURANCE CO.LTD. V. MR. PRAVEEN KUMAR SHARMA violated condition of this clause No. 2.4 of the policy. Thus, OP is deficient in not passing the claim of complainant by wrongly repudiated his claim without application of his mind.
17. Therefore, holding OP guilty of deficiency in service we direct it to pay to complainant an amount of Rs. 8,24,000/- (Rupees Eight Lac Twenty Four Thousand only) alongwith interest thereon @12% per annum w.e.f. 08.05.2014 till final payment with compensation of Rs.50,000/- and cost of litigation cost of Rs. 25,000/- (Rupees Twenty Five Thousand only)
18. All these amounts shall be paid within 30 days from the date of receipt of copy of this order. Failing which interest on 8,24,000/- (Rupees Eight Lac Twenty Four Thousand only) shall be charged @18% pa. till realization in full."
3. Aggrieved by the aforesaid order of the District Commission, the Appellant/Opposite Party has preferred the present appeal contending that the District Commission failed to appreciate that the Respondent concealed the fact that he was suffering from a prolonged disease of chronic kidney disease at the time of obtaining the policy, therefore, the repudiation of the claim as null and void was justified as per terms and conditions of the said policy regarding pre-existing disease. The counsel for the Appellant further contended that District Commission failed to appreciate section 45 of the insurance act, 1938 as the relationship between the insured and insurer is of utmost faith and is based on uberrima Fides and the Respondent had concealed the material fact of Pre-existing disease at the time of obtaining the said policy. The Pressing the aforesaid contentions, the Appellant prayed for setting aside the impugned judgment.
4. Notice was issued to the Respondent/Complainant to file reply to the present appeal. However, despite giving multiple opportunities, the Respondent has failed to file the reply to the present Appeal.
DISMISSED PAGE 7 OF 14 FA NO./512/2016 D.O.D.:08.02.2023
AEGON LIFE INSURANCE CO.LTD. V. MR. PRAVEEN KUMAR SHARMA
5. We have perused the material available on record and heard the counsel, appeared on behalf of both the parties.
6. The question for consideration before us is whether the insured i.e., Respondent has deliberately concealed the material fact of pre-existing disease i.e. Chronic Kidney Disease at the time of obtaining the policy.
7. On the concept, meaning and import of word disease, pre-existing disease in reference to medical insurance commission has drawn following ten conclusions in a highly extensive, dissecting manner in their decision Pradeep Kumar Garg v. National Insurance Co. Ltd., FA-482/2005 decided on 01.08.2008. These are as:
"a. Disease means a serious derangement of health or chronic deep-seated disease frequently one that is ultimately an insured must have been hospitalized or operated upon in the near proximity of obtaining the mediclaim.
b. Such a disease should not only be existing at the time of taking the policy but also should have existed in the insured had been hospitalized or operated upon for the said disease in the near past, say, six months or to disclose the said fact to rule out the failure of his claim on the ground of concealment of information as to.
c. Malaise of hypertension, diabetes, occasional pain, cold, headache, arthritis and the like in the body are normal modern day life which is full of tension at the place of work, in or out of the house and are controllable on standard medication and cannot be used as concealment of pre-existing disease for DISMISSED PAGE 8 OF 14 FA NO./512/2016 D.O.D.:08.02.2023 AEGON LIFE INSURANCE CO.LTD. V. MR. PRAVEEN KUMAR SHARMA repudiation of the insurance insured in the near proximity of taking of the policy is hospitalized or operated upon for the treatment of these other disease.
d. If insured had been even otherwise living normal and healthy life and attending to his duties and daily chores person and is not declared as a diseased person as referred above he cannot be held guilty for concealment medical terminology of which is even not known to an educated person unless he is hospitalized and operated particular disease in the near proximity of date of insurance policy say few days or months.
e. Disease that can be easily detected by subjecting the insured to basic tests like blood tests, ECG etc. the insured to disclose such disease because of otherwise leading a normal and healthy life and cannot be branded as diseased.
f. Insurance company cannot take advantage of its act of omission and commission as it is under obligation to issuing mediclaim policy whether a person is fit to be insured or not. It appears that insurance companies obligation as half of the population is suffering from such malaises and they would be left with no or very little .
Thus, any attempt on the part of the insurer to repudiate the claim for such non-disclosure is not permissible, exclusion clause invokable.
DISMISSED PAGE 9 OF 14 FA NO./512/2016 D.O.D.:08.02.2023
AEGON LIFE INSURANCE CO.LTD. V. MR. PRAVEEN KUMAR SHARMA a. Claim of any insured should not be cannot be repudiated by taking a clue or remote reference to any so called discharge summary of the insured had concealed his hospitalisation or operation for the said disease undertaken reasonable near proximity as referred above.
b. Day to day history or history of several years of some or the other physical problem one may face occasionally landed for hospitalisation or operation for the disease cannot be used for repudiating the claim. For instance suffered from a particular disease for which he was hospitalised or operated upon 5, 10 to 20 years ago and living healthy and normal life cannot be accused of concealment of pre-existing disease while taking mediclaim being cured of the disease, he does not suffer from any disease much less the pre-existing disease while taking as after being cured of the disease, he does not suffer from any disease much less the pre-existing disease.
c. For instance to pay that insured has concealed the fact that he was having pain in the chest off and on for years diagnosed or operated upon for heart disease but suddenly lands up in the hospital for the said purpose and disentitled for claim bares dubious design of the insurer to defeat the rightful claim of the insured on flimsy are not rare where people suffer a massive attack without having even been hospitalised or operated upon years or so.
DISMISSED PAGE 10 OF 14 FA NO./512/2016 D.O.D.:08.02.2023
AEGON LIFE INSURANCE CO.LTD. V. MR. PRAVEEN KUMAR SHARMA d. Non-instance of hospitalisation/or operation for disease that too in the reasonable proximity of the date of the only ground on which insured claim can be repudiated and on no other ground."
8. From the above dicta it is clear that unless and until a person is hospitalised or undergoes operation particular disease in the near proximity of obtaining insurance policy or any disease for which he has never undergone operation is not a pre-existing disease. If a person conceals the factum of his hospitalisation of an operation undergone by him in the near proximity of obtaining the insurance policy, only then it can be termed factum of disease and doctrine of good faith under Section 45 of the Insurance Act, 1938 can then alone be pressed company and not otherwise. Doctrine of good faith is two-way traffic and not a one-way traffic. If the Insurance benefit of doctrine of good faith, then they have to accept whatever the insured declares and should not subject medical test and get certificate from the doctor on the panel that the insured possesses sound and good health mediclaim insurance policy. Such a certificate will be meaningless and of no relevance as to the state of health.
9. The next issue of pre-existing disease has been dealt with by the Hon'ble NCDRC in the matter of Tarlok Chand India Insurance Co. Ltd. RP- 686/2007 decided on 16.08.2001 holding as under:
"Infact, the onus to prove that she had a pre-existing disease was on the respondent who failed to file or credible evidence in support of its case. Further, the deceased had been taking he mediclaim insurance the respondent right from 1996 and she had also as per the practice, been examined by the doctor DISMISSED PAGE 11 OF 14 FA NO./512/2016 D.O.D.:08.02.2023 AEGON LIFE INSURANCE CO.LTD. V. MR. PRAVEEN KUMAR SHARMA respondent/insurance company who has nowhere recorded that she had any medical problem relating."
10. The Hon'ble NCDRC is yet another judgment in National Insurance co. Ltd. vs. Rai Narain-2008 NCT 559 NCDRC held as under:
"Most of the people are totally unaware of the symptoms of the disease that they suffer and hence they liable to suffer because the Insurance Company relies on their clause 4.1 of the policy in a mala-fide repudiate all the claims. No claim is payable under the medi-claim policy as every human being is diseases are perhaps pre-existing in the system totally unknown to him which he is genuinely unaware Hindsight everyone relies much later that he should have known from some symptom. If this is so every medical studies and further not take any insurance policy."
11. The Hon'ble NCDRC in the matter of Praveen Damani v. Oriental Insurance Company Ltd. as reported 189 (NC) has held as under:
"....If this interpretation is upheld, the Insurance Company is not liable to pay any claim, whatsoever, person suffers from symptoms of any disease without the knowledge of the same. This policy is not just a contract entered only for the purpose of accepting the premium without the bona fide intention benefit to the insured under the garb of pre-existing disease. Most of the people are totally unaware the disease that they suffer and hence they cannot be made liable to suffer because the Insurance Company their clause 4.1 of the policy in a mala fide manner to repudiate all the claims. No claim DISMISSED PAGE 12 OF 14 FA NO./512/2016 D.O.D.:08.02.2023 AEGON LIFE INSURANCE CO.LTD. V. MR. PRAVEEN KUMAR SHARMA is payable policy as every human being is born to die and diseases are perhaps pre-existing in the system totally which he is genuinely unaware of them. Hindsight everyone relies much alter than he would have known symptom. If this is so every person should do medical studies and further not take any insurance policy facts on record, there is no material to show that the petitioner had any symptoms like chest pain etc. 11.08.2000."
12. The fact that the onus to prove that insured was suffering from pre-existing disease is on the Insurance Company the orders of the Hon'ble NCDRC in the Revision petition NoS. 2615 and 2616 of 2011 of LIC of India v. Priya Sharma and Ors. Decided on 02.11.2012 as reported in (NC). Secondly, if the policy was issued by the insurance company without proper verification, they cannot the claim at the later stage, as per the view held by the Hon'ble NCDRC in the Revision Petition no. 1676 of 2015, Oriental Insurance Co Ltd. v Dipender Kaur decided on 07.10.2015.
13. The Counsel for the Appellant has contended that fact that the Respondent was suffering from a prolonged chronic kidney disease and the said fact was concealed at the time of obtaining policy. However, in the absence of any cogent or tangible evidence to this effect, the said contention of the Appellant cannot be relied upon.
14. In view of aforesaid discussions done and the legal position as settled, we hold that the Appellant is deficient in providing services to the Respondent by repudiating his claim in the guise of non-disclosure of pre-existing disease.
15. Accordingly, we do not find any infirmity in the judgment of the District Commission and agree with the reasons given by the District Commission. Consequently, we uphold the judgment dated 23.04.2016 passed by the DISMISSED PAGE 13 OF 14 FA NO./512/2016 D.O.D.:08.02.2023 AEGON LIFE INSURANCE CO.LTD. V. MR. PRAVEEN KUMAR SHARMA District Consumer Disputes Redressal Forum (North -East), Bunker Vihar, Nand Nagri, Delhi - 93 and the present appeal is dismissed.
16. No order as to costs.
17. Application(s) pending, if any, stand disposed of in terms of the aforesaid judgment.
18. A copy of this judgment be provided to all the parties free of cost as mandated by the Consumer Protection Act, 1986. The judgment be uploaded forthwith on the website of the commission for the perusal of the parties.
19. File be consigned to record room along with a copy of this Judgment.
(JUSTICE SANGITA DHINGRA SEHGAL) PRESIDENT (PINKI) MEMBER (JUDICIAL) Pronounced On:
08.02.2023 DISMISSED PAGE 14 OF 14