BEFORE THE TELANGANA STATE CONSUMER DISPUTES REDRESSAL COMMISSION : HYDERABAD
FA NO.673 OF 2014 AGAINST CC NO.27 OF 2013
ON THE FILE OF DISTRICT FORUM, WARANGAL
Between:
1) The Manager, LIC of India,
Parkal Branch, Warangal district.
2) Life Insurance Corporation of India,
Rep. by its Sr. Divisional Manager,
Divisional Office: Balasamudram,
Hanamkonda, Warangal district.
…Appellants/Opposite parties
And
1) Bandi Sammaiah S/o Rajaiah,
Aged 55 years, Occ: Agriculture,
R/o Charpalli village, Parkal Mandal,
Warangal district.
2) Bandi Laxmi W/o Sammaiah,
Aged 50 years, Occ: Agriculture,
Charpalli village, Parkal mandal,
Warangal district.
…Respondents/Complainants
Counsel for the Appellants : Sri B.Madhava Satyanarayana
Counsel for the Respondents : Sri Kunamalla Karunakar
Coram :
Hon’ble Sri Justice B.N.Rao Nalla … President
and
Sri Patil Vithal Rao … Member
Tuesday, the Twenty First day of March
Two thousand Seventeen
Oral Order : (per Hon’ble Sri Justice B.N.Rao Nalla, Hon’ble President)
***
This is an appeal filed by the Opposite parties aggrieved by the orders of District Consumer Forum, Warangal dated 07.08.2014 made in CC No.27 of 2013 in allowing the complaint and directing the Opposite parties jointly and severally liable to deposit a sum of Rs.1,00,000/- towards sum assured amount with interest @ 7.5% p.a. from the date of filing of the complaint i.e., 22.02.2013 till the date of realization and costs of Rs.1,000/- within one month entitling the complainants in equal shares.
2) For the sake of convenience, the parties are referred to as arrayed in the complaint.
3) The case of the complainants, in brief, is that they are husband and wife in relation and that their son by name Bandi Kumaraswamy died on 06.12.2010 by committing suicide. During his lifetime, said Bandi Kumaraswamy had obtained policy bearing No.688373843 dt.15.12.2008 for the value of Rs.1,00,000/- and paid the premium regularly. After death of their son, the same was intimated to the Opposite parties submitting the claim form along with relevant documents viz., FIR, panchanama, post mortem examination report, final report, etc.,
4) To the surprise of complainants, the claim was repudiated by the Ops vide letter dated 27.07.2012 on the premise that the deceased withheld the material information regarding his age at the time of effecting the assurance as 19 years instead of 13 years. In fact, at the time of obtaining the policy, the deceased completed 18 years and he had died at an age of 22 years, hence, suppression of age does not arise. As the complainants were in deep sorrow, their relatives gave complaint before the police as 16 years, which is not correct. The ration card also shows the age claimed by the complainants to be true and correct.
5) In spite of the same, the act of the Ops in not settling the claim amounts to deficiency of service and unfair trade practice. The policy was obtained under Jeevan Anand (with profits) (with accident benefit), which is for the persons aged 19 years and as such, the Ops cannot deny payment of the same. Hence the complaint with a prayer to direct the Ops to pay the sum of Rs.1,00,000/- towards the sum assured and Rs.50,000/- towards damages and Rs.1,000/- towards costs of the notice, along with interest @ 9% p.a. and costs of the complaint.
6) Opposite parties filed written version admitting the issuance of policy in favour of the deceased and also the death of deceased on 06.12.2010. As the death occasioned within two years from the date of commencement of risk, treating it as early claim, the Ops investigated the claim and found that the life assured was minor as on the date of signing the proposal for insurance. His actual date of birth is 29.07.1995 which is corroborated by the study, conduct and date of birth certificate dated 09.08.2011 furnished by the Head Master, ZPPSS, Charlapally, Mandal: Parkal, Warangal district. As per said certificate, the deceased studied from 6th to 10th standard and as on date of signing the proposal, his age was 12 years 4 months and 16 days.
7) On account of suppression of material information regarding his age at the time of effecting the assurance, the claim under the policy was repudiated and the same was communicated to the nominee by letter dated 27.07.2012. Even the inquest panchanama and PME discloses the age of deceased as 16 years. Hence, there is suppression of material information on the part of the deceased, as such, prayed to dismiss the complaint with costs.
8) During the course of enquiry before the District Forum, in order to prove their case, the Complainants got filed the evidence affidavit on their behalf and Exs.A1 to A15 and on behalf of the Opposite parties, got filed the evidence on their behalf and Ex.B1 to B6.
9) The District Forum after considering the material available on record, allowed the complaint bearing CC No.27/2012 by orders dated 07.08.2014, as stated, supra, at paragraph no.1.
10) Aggrieved by the above orders, the Appellants/Opposite parties preferred this appeal contending that the forum below (a) ought to have dismissed the complaint for withholding the material information as regards the age; (b) failed to consider Ex.B4 study, conduct and date of birth certificate issued by the Head Master, ZPPSS, Charlapalli; (c) failed to see that the policy was obtained by misrepresenting the age and in fact, the deceased life assured was minor as on the date of signing the proposal, hence, incapacitated to contract, as such, the insurance contract is void abinitio; (d) erred in considering the document Ex.A14 and thereby concluded that the deceased was major by the time of taking the policy. Hence, the prayer to allow the appeal and set aside the orders dt.07.08.2014 of the District Consumer Forum, Warangal.
11) The point that arises for consideration is whether the impugned orders as passed by the District Forum suffer from any error or irregularity or whether they are liable to be set aside, modified or interfered with, in any manner? To what relief ?
12) The facts which are not in dispute is that the deceased life assured Bandi Kumaraswamy obtained the policy bearing No.688373843 for an assured sum of Rs.1,00,000/- and the deceased died on 06.12.2010 by committing suicide. The only dispute is that at the time of obtaining policy, the age of the deceased was over mentioned as 19 years instead of 13 years. As the claim is early one, the Appellants investigated the matter and have found that the age of the deceased was 13 years as on the date of obtaining the policy and 16 years as on the date of his death, which is evident from the conduct, bonafide and date of birth certificate issued by the school authorities and the post-mortem examination report by the concerned doctor.
13) To disprove the same, the Respondents filed Ex.A4 and Ex.A14. Ex.A4 is the certificate of hospital treatment. From the perusal of the same, the doctor by name G.Sukumar who treated the deceased at MGM Hospital, Warangal mentioned the age of the deceased as 22 years as on the date of his death while from the perusal of Ex.A14 it is clear that on 22.07.1992 the DLA was taken to the hospital for vaccination when he was one and half years old. In such a circumstance, without any hesitation, it can be stated that the deceased was aged 19 years as on the date of obtaining the policy and 22 years as on the date of committing suicide by him.
14) Even otherwise, at the time of filling the proposal form, the Appellants certainly should have obtained the proof of age and identification without which, issuing the policy is quite impossible. Having accepted the policy after due verification and having received the subsequent premia for two years and more, the Appellants cannot make a turn round and contend that the age of the deceased was shown as 19 years instead of 13 years. In order to evade payment of the claim amount, the appellants appears to have taken such flimsy and untenable pleas. In this regard, we may state that the Hon’ble National Consumer Disputes Redressal Commission, New Delhi in the matter of Abdul Latheef and others Vs. The Life Insurance Corporation of India in RP No.2370/2012 had observed as follows:
“It will be unfortunate, if the insurance companies try to repudiate genuine death claims on such technical and flimsy grounds. Most of the innocent insured will be victims and the beneficiaries will be deprived of the fruits of life insurance.”
“It is unfortunate that on one hand the LIC raises the voice of “Utmost good faith” but, in contrast, the faith will be lost while not settling the genuine claims for some or other reasons. It is the exploitation of the policy holders. The consumers are literally under fear or dilemma that, whether, after death, the beneficiaries ever certainly get any fruits from the LIC…..”
15) It became a routine manner to the insurance companies to take specious plea of suppression of fact when it comes to payment of claims. For that matter, the erstwhile State Consumer Disputes Redressal Commission of Andhra Pradesh while deciding the matter in FA No.1000 of 2013, in the matter of LIC of India & anr Vs. Pasupuleti Bhagya Laxmi & anr, decided on 14.08.2014, had observed as follows:
“……A close scrutiny of the proposal form would reveal even the columns were filled up by the agent and simply obtained the signatures of the proposer on ‘x’ marks. It is manifest that the proposal was routed through the agent of the LIC. If we may say so, the agents are playing fraud on LIC as well as gullible consumers with false assurances. When the policy was issued by the insurance company with utmost good faith, the same yardstick has to be applied while settling the claims also. The LIC ought to have made thorough enquiry, investigation or necessary medical health check-ups before issuance of policy irrespective of the amount involved. Without doing so, when they have issued the policy, now they cannot turn round and contend that they need not pay any amount as there was suppression of material information with regard to his health”.
We may state that the Appellants issued the policy after due verification and due ascertainment of information and after due examination of the deceased life assured, hence, they are estopped from making such false and flimsy pleas which are not sustainable in the eyes of law. The principle of uberrimae fidei (utmost good faith, literally meaning most abundant faith) is equally applicable to both sides and in this regard, we may state the decision rendered by the Hon’ble Apex Court reported in AIR 2000 Supreme Court 1014 in the matter of M/s Modern Insulators Ltd., Appellant Vs. Oriental Insurance Co., Ltd., Respondent, decided on 22.02.2000, wherein it is observed as follows:
“…….The insured has a duty to disclose and similarly it is the duty of Insurance Company and its agents to disclose all material facts in their knowledge since obligation of good faith applies to both equally……”
Accordingly, we answer the point framed for consideration at paragraph No.11, supra, against the Appellants and in favour of the Respondents.
16) In the result, the appeal fails and is accordingly dismissed with costs of Rs.5,000/- payable by the Appellants to the Respondents. Time for compliance : four weeks.
PRESIDENT MEMBER
Dated 21.03.2017
