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supression of material fact of heart problem while reviving the policy, not entitled for assured sum on the death of policy holder=The complainant was the son and nominee of the life assured (Sarbati Devi) who had obtained a life insurance policy from the respondent for the sum of Rs.48,000/-. This policy lapsed because of non-payment of half-yearly premiums due on 28.09.1999 and thereafter. However, it was revived for the full assured amount on 04.12.2000 after necessary payment and on the basis of personal declaration dated 04.12.2000 of the life assured. The said life assured, however, died of heart attack on 09.12.2000, i.e., within one week of revival of the insurance policy. The LIC repudiated the insurance claim by its letter dated 08.06.2002 on the ground that at the time of revival of the policy,Sarbati Devi withheld material information regarding the status of her health.

Life Insurance Corporation of India

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NATIONAL CONSUMER DISPUTES REDRESSAL

COMMISSION

NEW DELHI

REVISION PETITION NO. 2749 OF 2006

(From the order dated 20.07.2006 of the Haryana State Consumer Disputes Redressal Commission, Panchkula in Appeal no. 246 of 2004)

Lal Chand, son of Shri Birbal

Resident of village Kutipur

P.O. Bhood Kalan, Khizerabad East                         Petitioner

Tehsil Chhachhrauli                                             

District Yamuna Nagar, Haryana

versus

Life Insurance Corporation of India

Through its Manager (L & HPF)                              Respondent

Divisional Office, Chandigarh                                

 

BEFORE:

            HON’BLE MR. ANUPAM DASGUPTA    PRESIDING MEMBER

          HON’BLE MR. SURESH CHANDRA      MEMBER

For the Petitioner                 Mr. Gautam Godara, Advocate

For the Respondent              Mr. S.P. Mittal, Advocate

Pronounced on  13th December, 2011

O R D E R

ANUPAM DASGUPTA

        This revision petition is directed against the order dated 20.07.2006 of the Haryana State Consumer DisputesRedressal Commission, Panchkula (in short, ‘the State Commission’). By this order, the State Commission set aside the order dated 15.12.2003 of the District Consumer Disputes Redressal Forum, Jagadhari (in short, ‘the District Forum’) and allowed the appeal of the respondent Life Insurance Corporation of India (LIC).

2.     The complainant was the son and nominee of the life assured (Sarbati Devi) who had obtained a life insurance policy from the respondent for the sum of Rs.48,000/-. This policy lapsed because of non-payment of half-yearly premiums due on 28.09.1999 and thereafter. However, it was revived for the full assured amount on 04.12.2000 after necessary payment and on the basis of personal declaration dated 04.12.2000 of the life assured. The said life assured, however, died of heart attack on 09.12.2000, i.e., within one week of revival of the insurance policy. The LIC repudiated the insurance claim by its letter dated 08.06.2002 on the ground that at the time of revival of the policy,Sarbati Devi withheld material information regarding the status of her health.

3.     Aggrieved by this repudiation, the nominee of the deceased life assured (petitioner before us) filed a consumer complaint before the District Forum seeking direction to the LIC to pay him the assured sum with interest @ 12% per annum from the date it had become due till payment and Rs.10,000/- towards litigation cost.

4.     On consideration of the pleadings, evidence and documents, the District Forum allowed the complaint and directed the opposite party (OP)/LIC to pay to the complainant/petitioner the sum assured with interest @ 12% per annum from the date three months after lodging of the claim till the date of payment and compensation/cost of Rs.2000/-.

5.     This order was challenged in appeal by the LIC, leading to the impugned order of the State Commission.

6.     We have heard Mr. Gautam Godara, learned counsel for the petitioner and Mr. S.P. Mittal, learned counsel for the respondent and considered the documents relied upon by the parties.

7.     Mr. Godara has argued that the declaration submitted by the life assured was before a qualified medicalpractioner (one Dr. Ritu Mago) of the LIC and if Sarbati Devi had indeed suffered a fracture of the pelvic bone as a result of a fall in late October 2000, the said doctor could not have failed to notice her condition. That the said doctor did not record any such observation was proof enough that Sarbati Devi did not have this problem at the time of revival of the policy. The second argument of Mr. Godara is that the medical certificate issued by the doctor in-charge of “Dr.Kashmiri Lal K Hospital” and produced by the LIC as “evidence” in support of the ground for repudiation is not worthy of reliance at all because the LIC had not examined the said doctor before the District Forum to prove the handwritten medical certificate which was not even on the letterhead of that Clinic. Therefore, LIC had not been able to establish that in reply to question no. 2 regarding the status of her health just before the revival of the insurance policy SarbatiDevi did not disclose material facts regarding her health.  Based on the letter of the complainant, Mr. Godara has added that the fall that she suffered led to some injuries to her ligaments which had been cured by the time she made the said declaration.

8.     On the other hand, Mr. Mittal has argued that the life assured expired within a few days of revival of the life insurance policy. Therefore, in view of the provisions of section 45 of the Insurance Act, 1938, the mandatory onus of establishing that the material facts known to her had not been disclosed by the life assured did not lie with the LIC. In any case, the fact that Sarbati Devi had suffered a fall leading to injury to her hip bone was clearly admitted in the signed letter of Lal Chand (complainant) and Phool Chand as well as the signed statements dated 21.10.2001 ofBaldev Singh and Om Prakash. Therefore, the fact that Sarbati Devi had suffered serious injury because of an accidental fall was withheld by her in her declaration of 04.12.2000 before the Medical Officer of the respondent and this fall and injury suffered by the life assured was a position admitted by the complainant/petitioner. LIC was thus justified in repudiating the claim and hence the impugned order of the State Commission ought to be upheld. Mr. Mittal has also sought to rely on some judgments of the Apex Court as well as this Commission on the duty of “utmost good faith” on the part of the life assured in disclosing all material facts.

9.     On perusal of the declaration form, we find that under question no. 2(c), apart from disclosure about any surgery, the proposer – life assured has to state if he/she has met with an accident or suffered any injury/hurt. Whether the injury suffered by Sarbati Devi actually led to fracture of her hip/pelvic bone or it was merely an injury to the muscles/ligaments is thus not important. What is important instead is that she had to disclose that she suffered an accidental fall that led to some injury/hurt. However, her specific answer to this question was “No”. We are also inclined to agree with Mr. Mittal that the claim on behalf of the petitioner that the Medical Officer of the LIC in whose presence the declaration form was signed by Sarbati Devi would have noticed an injury like a fracture had it been there is not in accord with the duty cast on the said Medical Officer. This is clear from the pre-printed declaration of the Medical Officer which only required her to declare that she had explained to the proposer the questions/points raised in the form, that the replies given by the proposer were read over to her and that she (the proposer) put her thumb impression on the form only after understanding the contents of the form. Given the foregoing factual and legal position, the fact that the private doctor to whom Sarbati Devi was allegedly taken for treatment was not examined by the LIC before the District Forum to prove the medical certificate in question would also not be of much help to the petitioner. Thus, the only surviving important point on failure to disclose material fact relating to health of the deceased life assured is her answer to question no. 2 (c), as summarised above. This, in our view would entitle the LIC to repudiate the claim, in accordance with the law settled by the Apex Court in the case of P.C. Chacko and Anr. vChairman, Life Insurance Corporation of India and Others [2008 (1) SCC 321].

10.    In view of the foregoing discussion, there is no ground for us to interfere with the well-reasoned order of the State Commission under section 21 (b) of the Consumer Protection Act, 1986. The revision petition is accordingly, dismissed with no order as to cost.

Sd/-

d/p

………………………………………….

[ Anupam Dasgupta ]

Sd/-

…………………………………….

[ Suresh Chandra ]

satish

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