REASONS POINTS 1&2: As per complainant her husband Sri.Narayan s/o.Kamanna Garadimani had taken a life insurance policy bearing no.71641868 by paying premium amount of Rs.2000/- thorugh DD for insured amount of Rs.408000 through R2 at Hubli which is a medical policy. Her husband died on 18-12-2007.
As per complainant though she applied for policy claim of her husband it is not settled inspite of issuing legal notice. The respondent-1 has contended that number 71641868 is the proposal form number and not the policy number. Such contention cannot be accepted because, in ECPL details the policy number, status, sum assured, name of insured, DD number, application number, name of bank etc., are mentioned. In that document no.71641868 is mentioned as policy number but not as proposal form number.
If it was the proposal form number, the respondent-1 would not have mentioned it as policy number. II (1993) CPJ 146 (NC) is relied on for R1. As per that decision before acceptance of proposal, proposer expired under such circumstance insurance company was not held liable. Such circumstance has not occurred in the instant case. An unreported decision rendered in appeal no.1482/1999 Jaipur State Redressal Commission is also relied on for R1 as per that decision mere payment of premium and its acceptance by the agent does not amount to a concluded contract of insurance. Whereas in the instant case, premium was not only paid by the proposer, on the other the respondents have given policy number to the proposer.
When policy number is given it is to be held that, the proposal has been accepted and policy was issued. It is therefore in the opinion of the forum those 2 decisions are of little help to R1. The respondent-1 claims to have returned the proposal form of husband of complainant but, it is returned stating he was no more. The respondent-1 has produced cover, a letter and Xerox copy of a cheque for Rs.22000/-. In the letter of R1 dtd.29-9-2008 said to be sent through that letter wherein policy number 0071641868 is clearly mentioned and not as proposal form number.
If respondent-1 had not accepted the premium amount of that Narayan Garadimani would not have given the policy number. This is the one point. Another point is that, through that letter R1 claims to have sent a cheque for Rs.22000/- its Xerox copy is also produced. When respondent-1 had not accepted the proposal of that Narayan Garadimani, what was the necessity to send a cheque for Rs.22000 when that Garadimani had paid only Rs.2000 towards premium amount.
This is the another circumstance to disbelieve the contention of respondent-1. Even on the cover of that letter below the address of Narayan Garadimani, policy number is mentioned but not as proposal form number. All these circumstances clearly go to show that respondent-1 has accepted the proposal of Narayan Garadimani and in consequence issued policy number but, now it has a taken a different stand. In the letter of R1 dtd.29-9-2008 it is stated that, Narayan Garadimani was not able to get the requirement under the above policy. In that letter it is not specifically mentioned as to what was to be done by that proposer.
At the time of argument it was much more contended for R1 that, that Narayan Garadimani was not subjected to medically checked, So, he had not complied with required condition so, his policy was not considered. Admittedly, it is a medical policy. When R1 received the proposal form along with premium amount whether it got him medically tested through its panel of doctors, nothing is whispered. Even it is not specifically stated by R1 that, it has no panel of doctors and it has no procedure to get any proposer medically checked, before accepting a proposal for insurance policy.
One more point was argued for R1 that, that Narayan Garadimani has suppressed a material fact of suffering from AIDS while submitting proposal form that is another circumstance to reject his proposal, Moreover, acceptance of proposal and issue of insurance policy mainly depends on good faith. No doubt an insurance company has to act upon on good faith but, that good faith does not only apply to proposers and it equally applies to insurance companies in view of a decision 2008 CTJ NCDRC 707. The complainant herself has produced certain documents some of them relate to medical treatment of her husband Narayan Garadimani. In those documents some ailments are mentioned such as fever chill, viral fever, pain in abdomen, cough etc., but those complaints were said to be since one month before admitting in Chigteri Dist. Hospital, Davanagere. But, those medical documents are subsequent to the proposal form.
In some documents the word AIDS is mentioned. But R1 has not produced any documents of hospital to show that proposer was suffering from AIDS. It is not proved by R1 that, that Narayan Gardimani had knowledge about his suffering from AIDS even then suppressing it, sent proposal form for medical insurance. This is one point. Another point is that, as already stated whatever medical documents are made available by complainant but not by the respondent-1 which show that, such suffering was subsequent to the proposal form and insurance policy given. As such it cannot be said that Narayan Garadimani had suppressed material fact suffering from AIDS.
Unless there is positive evidence about suppression of disease, insurance company cannot avoid payment in view of a decision 2008 CPR 96 NS As per another decision 2009 CTJ 37 NCDRC Non disclosure of suffering from fewer or down with flu on some occasions not a material matter. As per another decision 2009 CTJ 74 NCDRC, wherein their lordships have held that, in today’s world many people face problems of acidity, indigestion, back pain and head ache.
Some of them chronic and symptoms may occur from time to time with different levels of intensity, cannot be considered as disease leading to repudiation of insurance claims on that ground. In view of these reasons the contention of R1 that, Narayan Garadimani had suppressed about his disease while taking medical policy cannot be accepted. One more point was argued for R1 that, complainant has colluded with R2 and R2 is nothing to do with it. If R1 was not at all concerned then, why it received the proposal form and premium amount from R2 nothing is stated, even after receiving such proposal form and premium amount why it retained them for nearly 6 - 7 months without returning it at the earliest, nothing is stated. As such, such contention of R1 cannot be accepted.
Even the contention of R1 that, when proposal form was not accepted the question of issuing insurance policy itself had not arisen, cannot be accepted for the reasons already discussed. Even it was argued for R1 that, documents were not received. If necessary documents were not received then why it gave policy number, has not been clarified. The learned counsel for complainant has produced an unreported decision of the Hon’ble. National Consumer Disputes Redressal Commission, New Delhi rendered in Rev.Pet.No.702/2003 (Life Insurance Corporation and others V/s. Mrs. Rakshana Devi) dtd.20-10-2005, wherein their lordships have observed that the proposal shall be processed by the insurer with speed and efficiency and all decisions shall be communicated by it in writing within a reasonable period, not exceeding 15 days from the receipt of the proposal by the insurer. Further held that, in that case there was unjustifiable delay in accepting proposal dtd.28-10-1997 only on 2-3-1998. in that decision it is also further observed that, for human being death may be natural or accidental and it may happen at any point of time therefore, it is not a case of agreement contingent on impossible event.
In the instant case also proposal was said to be made prior to 1-9-2007 because, as per letter of the respondent-1 addressed to Narayan Garadimani dtd.1-9-2007 wherein it has expressed its happiness about the proposal made by him. If such proposal was not made R1 would not have written letter like so. Respondent-1 claims to have returned that proposal form on 29-9-2008 it means considerable delay has been caused by it, so the principles held in the above referred decisions can be applied to the instant case also. As per another decision 2008 CTJ (CP) SC 917 wherein their lordships have held that, insurance company being in dominant position often acts in an unreasonable manner and after having accepted the value of particular insured, disown that very figure on one pretext or other when called upon to pay compensation.
This “take it or leave it” attitude is clearly unwarranted not only as being in bad in law but also ethically indefensible. After filing complaint notice was issued to respondents but inspite of service even R1 had also remained absent as such it was placed exparte. But subsequently R1 got it set aside which shows its attitude. Complainant had got issued legal notice to R1 but, R1 had not replied to it. In view of all these reasons it is held that non settlement of the claim amounts to deficiency in service. Insured sum is Rs.408000/- if reasonable rate of interest is ordered separate order for mental agony and deficiency in service may not be necessary. However the complainant will be entitled to the cost of the litigation. Hence, the point.1 is answered in Positive and point.2 in Positive but accordingly. Point. 3: In view of the finding given on points 1 and 2 proceeded to pass the following O R D E R The complaint is allowed in part with a direction to the respondent-1 to pay insured sum Rs.4,08,000/- with 6% interest p.a payable from the date of complaint till its realization along with Rs.1,000/- towards cost of the litigation within one month from the date of receipt of copy of this order. No order is made against R2.