Punjab

Faridkot

CC/17/294

Gurwinder Kaur - Complainant(s)

Versus

LIC - Opp.Party(s)

Vinod Kumar Monga

05 Feb 2019

ORDER

    DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, FARIDKOT

 

Complaint No. :    294 of 2017

Date of Institution: 01.09.2017

Date of Decision :  05.02.2019

 

Gurwinder Kaur aged about 39 years, widow of Gurshinder Singh r/o Quarter No.46-C, Police Lines, Faridkot.                                                                                       

....Complainant

Versus

Life Insurance Company of India, through its Branch Manager, Faridkot.                                                     

                 .............OPs

Complaint under Section 12 of the

Consumer Protection Act, 1986.

 

Quorum: Sh. Ajit Aggarwal, President,

               Smt Param Pal Kaur, Member.

 

Present: Sh Vinod Monga, Ld Counsel for Complainant,

              Sh Lakhwinder Singh, Ld Counsel for OPs.

 

ORDER

(Ajit Aggarwal, President)

                                       Complainant has filed the present complaint under Section 12 of the Consumer Protection Act, 1986 against OPs seeking directions to OPs to make payment of insurance claim of Rs.5,50,000/- and Rs.3,50,000/- in respect of deceased Gurshinder Singh nd for further directing OPs to pay Rs.2 lacs as compensation for deficiency in service and harassment alongwith litigation expenses of Rs.20,000/-.

 

Complaint No. - 294 of 2017

2                                               Briefly stated, the case of the complainant is that husband of complainant was a Police Personal and he was insured with OPs vide Insurance Policy No.132431755 for Rs.5,50,000/- and another insurance policy no.132464255 for Rs.3,50,000/-and during his life time, he was regularly paying premiums for the insurance policy. It is further submitted that first time he suffered from the problem in abdomen and was admitted in Civil Hospital, Faridkot on 10.12.2010, but he could not get relief from there and thus, was shifted to Nayyar Hospital, Amritsar on 19.12.2010, but at that place treatment was not satisfactory and therefore, he remained admitted in DMC, Ludhiana from 23.12.2010 to 29.12.2010 where husband of complainant passed away on 29.12.2010 due to ALD Cirrhosis C PHTN C as cites C HE Gr IV SBP, UGI Bleed. Prior to this, he never suffered from any disease and never underwent any treatment or hospitalized for any problem. Being employee of Punjab Police. He was used to be checked up Medically every year by doctors of their Department and even he never availed any leave on medical grounds during the period of last five years of his death. After his death, complainant submitted all the relevant documents like original insurance policy, death certificate etc as demanded by Ops for obtaining the insurance claim on account of death of her husband, but despite completion of all formalities by complainant, OPs did not pay even a single penny as insurance claim and repudiated the same vide letter dated 31.03.2017 on the ground that insured deceased was a case of ALD for 3 years and was suffering from Alcohol

Complaint No. - 294 of 2017

related Cirrhosis, PHTN, Ascites, UGI Bleed, Coagulopathy, Superadded Alcoholic Hepatitis with Hepatic Encephalopathy Gr II. As per OPs, deceased was a chronic alcoholic for last 25 years and this history was reported by patient or his relatives. Ld counsel for complainant submitted before the Forum that at the time of his admission in DMC, Ludhiana, age of deceased was only 37 years and if ground taken by OPs for repudiation of claim that deceased was a chronic alcoholic for last 25 years is considered right then, age of deceased was only 12 years when he started consumption liquor which is totally unbelievable. Therefore, remarks given by OPs are totally incorrect. It is further submitted that deceased was government employee and during five years prior to his death, he neither suffered from any diseased nor he availed any medical leave and moreover, as per report of Medical Officer of Police Lines, Faridkot deceased was found medically fit and fine in year 2007, 2008, 2009 and 2010 during his annual medical check up. But OPs are deliberately and intentionally trying to evade their responsibility of making payment of insurance claim and have caused unnecessary delay in paying the claim. All this amounts to deficiency in service and has caused harassment and mental tension to complainant for which prayer is made for directing the OPs to pay compensation and litigation expenses besides the main relief. Hence, the complaint.

3                                        The counsel for complainant was heard with regard to admission of the complaint and vide order dated 11.09.2017,

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complaint was admitted and notice was ordered to be issued to the opposite party.

4                                       On receipt of the notice, OPs appeared in the  Forum through Counsel and filed reply taking preliminary objections that as  per terms and conditions of the insurance policies in question, complainant is not entitled to any claim and she has not filed any representation before Zonal Manager, LIC of India regarding repudiation of her claim. However, on merits OPs have denied all the allegations of complainant being wrong and incorrect but admitted before the Forum that deceased was insured with them in respect of two policies in questions. It is averred that they have rightly repudiated the claim of complainant after due application of mind on the ground that treatment record of D M C, Ludhiana reveals that deceased life assured was a known case of ALD for 3 years and was suffering from Alcohol related Cirrhosis, PHTN, Ascites, UGI Bleed, Coagulopathy, Superadded Alcoholic Hepatitis with Hepatic Encephalopathy Gr II and expired on 29.12.2010. it is averred that deceased has intentionally suppressed the material facts relating with the risk of life at the time of obtaining insurance policies in question. Deceased obtained insurance policy no.132464255 on 28.03.2009 and he died on 29.12.2010 i.e within a period of one year and nine months from the date of commencement of policy meaning thereby with in the period of two years. Date of commencement of second insurance policy purchased bearing no.132431755 is 26.08.2010 and he died on 29.12.2010 thus, within a

Complaint No. - 294 of 2017

period of four months  and one day of purchase of policy in question he expired. It is further averred that insured deceased had full knowledge of his ailments but he intentionally concealed real information regarding his diseases and gave incorrect information about his health by making false answers to the queries relating to his health. Treatment record of DMC, Ludhiana clearly reveals the fact deceased was a known case of ALD for three years and he was suffering from Alcoholic Liver Disease and Alcohol related Cirrhosis PHTN Ascites, UGI Bleed, Coagulopathy, Superadded Alcoholic Hepatitis with Hepatic Encephalopathy Gr.II and die don 29.12.2010. Form No.3784 and 3816 given by DMC, Ludhiana reveals that he was Chronic Alcoholic for last 25 years and 3784 Form completed by Nayyar Hospital, Amritsar also reveals the history of Chronic Alcoholism. His habit of Chronic Alcoholism and illness of Alcoholic Liver Disease is prior to the date of proposal under both the polices. He has deliberately and intentionally concealed the material facts regarding his health to mislead and defraud the OPs. They have rightly repudiated the claim of complainant and there is no deficiency in service on their part and prayed for dismissal of complaint with costs.

5                                          Ld Counsel for complainant tendered in evidence affidavit of complainant as Ex.C-1, and documents Ex C-2 to Ex C-11 and then, closed the evidence.

6                                      To controvert the allegations of complainant, ld counsel for OPs tendered in evidence affidavit of Jagdeep Sharma as Ex

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OP-1 and documents Ex OP-2 to OP-16 but, did not conclude evidence despite availing several opportunities and therefore, vide order dated 26.06.2018, evidence of OPs was closed by order of this Forum.

7                                     We have heard the learned counsel for complainant as well as OPs and have very carefully gone through the affidavits and documents placed on the file.

8                                               The Ld Counsel for complainant contended that her husband was a Police Personal and was insured with OPs vide Insurance Policy No.132431755 for Rs.5,50,000/- and another insurance policy no.132464255 for Rs.3,50,000/-and during his life time, he was regularly paying premiums for the insurance policy. It is further contended that it was the first time when he suffered from the problem in abdomen and was admitted in Civil Hospital, Faridkot on 10.12.2010, but he could not get relief from there and thus, was shifted to Nayyar Hospital, Amritsar on 19.12.2010, but from there he was shifted to DMC, Ludhiana on 23.12.2010, where he remained hospitalized and died on 29.12.2010 due to ALD Cirrhosis C PHTN C Ascites C HE Gr IV SBP, UGI Bleed. Prior to this, he never had any health problem or suffered from any disease and being employee of Punjab Police, was used to be checked up Medically every year by doctors of their Department and even he never availed any leave on medical grounds during the period of last five years of his death. After his death, complainant lodged claim with OPs and submitted all the relevant

Complaint No. - 294 of 2017

documents, but despite completion of all formalities by complainant, OPs did not clear the insurance claim and repudiated the same vide letter dated 31.03.2017 on the ground that insured deceased was a chronic alcoholic for last 25 years. Ld counsel for complainant submitted at the time of his admission in DMC, Ludhiana and at the time of his death, his age was only 37 years and if ground taken by OPs for repudiation of claim that deceased was a chronic alcoholic for last 25 years is considered right then, age of deceased was only 12 years when he started consumption liquor which is totally unbelievable. Therefore, ground taken by OPs for repudiation is totally incorrect. Deceased was government employee and during five years prior to his death, he neither suffered from any disease nor he availed any medical leave and even as per report of Medical Officer of Police Lines, Faridkot he was found medically fit in year 2007, 2008, 2009 and 2010 during his annual medical check up. But OPs are deliberately and intentionally trying to evade their responsibility of making payment of insurance claim and have caused unnecessary delay in paying the claim, which amounts to deficiency in service and has caused harassment and mental tension to complainant. He has prayed for accepting the present complaint alongwith compensation. Ld counsel for complainant has stressed on documents Ex C-1 to 11.

9                                      On the other hand, ld counsel for Ops argued before the Forum that as per terms and conditions of the insurance policy, complainant is not entitled to any relief sought by her as she has

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not filed any representation before Zonal Manager, LIC of India regarding repudiation of her claim. OPs have denied all the allegations of complainant being wrong and incorrect but it is admitted that deceased was insured with them in respect of two policies in questions. They have rightly repudiated the claim of complainant after due application of mind on the ground that treatment record of D M C, Ludhiana reveals that deceased life assured was a known case of ALD for 3 years and was suffering from Alcohol related Cirrhosis, PHTN, Ascites, UGI Bleed, Coagulopathy, Superadded Alcoholic Hepatitis with Hepatic Encephalopathy Gr II and expired on 29.12.2010. Deceased has intentionally suppressed the material facts relating with the risk of life at the time of obtaining insurance policies in question and obtained policies in question to defraud the OPs. Deceased obtained insurance policy no.132464255 on 28.03.2009 and he died on 29.12.2010 i.e within a period of two years. Date of commencement of second insurance policy no.132431755 is 26.08.2010 and died on 29.12.2010 thus, within a period of four months  and one day of purchase of policy, he expired. It is further argued that insured deceased had full knowledge of his ailments but he intentionally concealed real information regarding his diseases and gave incorrect information about his health by making false answers to the queries relating to his health. Treatment record of DMC, Ludhiana clearly reveals the fact that he was suffering from Alcoholic Liver Disease and Alcohol related Cirrhosis PHTN Ascites, UGI Bleed, Coagulopathy, Superadded Alcoholic Hepatitis with Hepatic

Complaint No. - 294 of 2017

Encephalopathy Gr.II and died don 29.12.2010. Form No.3784 and 3816 completed by DMC, Ludhiana reveal that he was Chronic Alcoholic for last 25 years and 3784 Form completed by Nayyar Hospital, Amritsar also reveals the history of Chronic Alcoholism. His habit of Chronic Alcoholism and illness of Alcoholic Liver Disease is prior to the date of commencement of both the polices. He has deliberately and intentionally concealed the material facts regarding his health to mislead and defraud the OPs. All the wrong statements given by him concealing his disease has affected the terms and conditions of policy in question and they have rightly repudiated the claim of complainant.  It is reiterated that there is no deficiency in service on the part of OPs and asserted that they rightly and legally repudiated the claim of complainant as per terms and conditions of the policy with due application of mind. He has prayed for dismissal of complaint with costs.

10                                  From the careful perusal of record and documents placed on record, it is observed that case of the complainant is that her husban was insured with OPs, who died and after his death, complainant completed all the formalities and submitted requisite documents to them, but they did not make payment of insurance claim on account of death of her husband to her on the pretext that her husband concealed the material fact that was suffering from chronic alcoholism for last 25 years. In reply, Ops admitted that deceased husband of complainant was insured with them, but denied all the other allegations of complainant being wrong and incorrect on the ground that deceased

Complaint No. - 294 of 2017

had intentionally and deliberately concealed the fact of his chronic illness from OPs while obtaining the insurance policies in question. As per OPs, they have rightly and legally repudiated the claim of complainant.

11                                   Now, it is admitted case of the parties that Gurshinder Singh / husband of complainant was insured with Ops and during the insurance period, he died and complainant lodged claim with OPs being his nominee. Only plea for repudiating the claim by OPs is that prior to purchase of the policy in question, said Gurshinder Singh was suffering from complicated chronic alcoholism, alcohol related Cirrhosis, PHTN, Ascites, UGI Bleed, Coagulopathy, Superadded Alcoholic Hepatitis with Hepatic Encephalopathy Gr II and he did not disclose this fact to OPs in the proposal form filled by him at the time of purchase of insurance policy and suppressed the material facts regarding his health from the OPs and as per terms and conditions of policy, the complainant is not entitled for any relief under the policy in question. On the other hand, ld counsel for complainant argued that Gurshinder Singh never suppressed any facts regarding his health from OPs. He disclosed each and every thing regarding his health and gave correct information to OPs and now, Ops wrongly and illegally repudiated the claim of complainant on false and flimsy grounds only to avoid the payment of insurance claim. It is wrong that deceased Gurshinder Singh was Chronic alcoholic and was suffering from alcohol related cirrhosis at the time of purchase of policy in question. He was not suffering from liver

Complaint No. - 294 of 2017

cirrhosis, Hepatitis with Hepatic Encephalopathy and he was not in knowledge of these diseases and at that time, he was altogether hale and healthy and was being regularly checked up by Police Department and found to be fit in medical examination. It is wrong that Gurshinder Singh deceased was chronic alcoholic since last 25 years. The OPs have wrongly and illegally repudiated the claim of complainant on the basis of alleged medical record, which is not recorded either on the statement of complainant or statement of Gurshinder Singh deceased. There is no mention in medical record that on whose statement it is recorded. Even the OPs did not examine the doctors who recorded these statements and in the absence of doctors, it cannot be taken into consideration as authentic.

12                                     He put reliance on citation 1992 (2) CPJ 834 titled as Post Master General Vs Bhateri and Ors, wherein Hon’ble Haryana State Consumer Disputes Redressal Commission, Chandigarh held that Consumer Protection Act, 1986 Section 15 Insurance claim – Additional evidence – The appellant challenged the order of the District Forum directing the appellant to make payment of the insured amount of Rs.25,000/- to the respondents – It was alleged that the insured deceased had died of cancer which fact was concealed from the appellant at the time of insurance – the material proposal form which was the foundation of the appellants case was not produced in evidence not any application for additional evidence was filed at the initial stage by the appellant – challenge to order of the District Forum under appeal is patently futile.

 

 

Complaint No. - 294 of 2017

13                                  The ld counsel for complainant further argued that prior to issuance of insurance policy in question, the OPs themselves got conducted the medical check up of Gurshinder Singh from their doctor who declared him fit. It is also their duty to get entire medical check up of the insured before issuance of Policy and now, after death, they cannot deny payment to complainant on the ground of any pre-existing disease. He further put reliance on citation 2016 (4) CLT 372 titled as SBI General Insurance Company Ltd Vs Balwinder Singh Jolly & anr wherein our Hon’ble Chandigarh State Consumer Disputes Redressal Commission, U T, Chandigarh held that Consumer Protection Act, 1986, Section 2(1) (g) – Insurance claim (Mediclaim) – Hypertension – Pre-existing disease – Age of insured when Mediclaim insurance policy was issued was more than 45 years – Held – In that event, as per instructions issued by Insurance Regulatory & Development Authority of India (IRDA), it was duty of the insurer to put insured to thorough medical examination – Claim raised after issuance of insurance policy cannot be rejected on account of non-disclosure of the fact of pre-existing disease when policy was obtained. Now, at this stage, they cannot repudiate the claim of complainant on false grounds.

14                                 Ld Counsel for complainant put further reliance on judgment given by Hon’ble State Consumer Disputes Redressal Commission UT, Chandigarh in FA No.A/84/2018 decided on 15.05.2018 titled as Bharti Axa Life Ins Co Ltd and others Vs Mamta

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Kumari 2018 (3) CLT wherein it is held that Consumer Protection Act, 1986, Section 2(1) (g) – Insurance claim – Pre-existing illness-Plea of Insurance Company that when insurance cover was taken, the deceased was suffering from Diabetes Mellitus for the last 7 years with hypertension for the last 3 years and he was under treatment and relied upon the copy of the death summary issued by the IVY hospital, Mohali, and OPD card issued by the PGIMER, Chandigarh – Held – Unless it is proved on record that who gave facts regarding the illness suffered by the deceased, reliance cannot be placed upon summary chart – Appeal dismissed.  He has also relied upon judgment 2018 (3) CLT 289 in Revision Petition NO. 2942 of 2009 decided on 15.02.2009 LIC of India Vs P R Sumangala wherein our Hon’ble National Consumer Disputes Redressal Commission, New Delhi held that Even if the complainant was diabetic, he may not having any knowledge of his disease and the Insurance Company has not proved beyond doubt that the insured had knowledge of his illness of diabetes prior to filling of the proposal form as no treatment record prior to date of filling up the proposal for has been produced – No question of suppressing the fact of his diabetes arises – Revision petition dismissed.

15                                   Ld counsel for complainant further placed reliance on citation 2014(4) CLT 507 given by Hon’ble National Consumer Disputes Redressal Commission, New Delhi in Revision Petition No.1304 to 1306 of 2014 decided on 5.11.2014 titled as M/s ICICI Prudential Life Insurance Company Ltd Vs Veena Sharma &

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others wherein Hon’ble National Commission, New Delhi observed that Consumer Protection Act, 1986, Section 2(1) (g)- Insurance claim (Life)-Repudiated on the ground that deceased/insured had disclosed to the Medical Examiner that he was suffering from Diabetes Mellitus since 8 years-Death of insured- Complainants claimed insurance amounts of three polices – State Commission held that mere production of Discharge Card was not enough- Insurance Company was also required to prove with credible evidence that the complainant was suffering from the pre-existing disease and had knowingly failed to disclose the same-Findings upheld – Held-that failure to tender evidence of the examining doctor, destroys the credibility of the case of the insurance company. It is observed that complainant has produced sufficient and cogent evidence to prove her case. Even if it is presumed that deceased Gurshinder Singh was habitual of drinking liquor and was suffering from chronic alcoholism for last 25 years then, it is not palpable that a 12 year boy was habitual of liquor consumption because record itself shows that at the time of death, age of deceased Gurshinder Singh was only 39 years. It is unbelievable that 12 year old person was in habit of liquor and he got government job in Police Department where medical checkups of police personals are being conducted every year. There is no concealment of any fact regarding his health from OPs. Medical Check up record of deceased insured Gurshinder Singh conducted by Police Department placed on record by complainant counsel is beyond any doubt and is fully authentic. It is observed that

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Ops are intentionally evading their liability of making payment of insurance claim to complainant on false and baseless grounds.

16                                            Ld Counsel for complainant argued that if for the sake of arguments, it is admitted that Gurshinder Singh deceased was habitual of taking alcohol and this fact was not disclosed by him in the proposal form at the time of purchase of insurance policy in question, then, in that case also, the Ops cannot repudiate the claim of complainant in toto as claim of complainant is to be decided on non standard basis. He has put reliance on citation order dated 26.08.2016 given by our Hon’ble National Consumer Disputes Redressal Commission, New Delhi passed in Revision Petition no. 1729 of 2016 titled as PNB Met Life Insurance Company Limited Vs Smt. Sunita Goyal and others, whereas our Hon'ble National Commission, held that when the petition came up before this Commission on 4.7.2016, the petitioner was directed to file an affidavit stating therein as to whether the policy would have been granted to the deceased or not had he disclosed that he had been smoking for more than 5 years before submitting the proposal. The petitioner company, in compliance of the aforesaid direction, has filed an affidavit of Motty John who has stated that had the policyholder disclosed the fact that he had been smoking for more than 5 year before submitting the proposal, the policy would have been issued, but the premium would have been on higher side. Thus, the policy of the insurer was not to deny insurance to a smoker though it would have charged a higher premium while insuring the life of such a person. The affidavit

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filed by the petitioner company does not indicate the extent to which the premium would have increased in the case of a smoker. Considering all the facts and circumstances of the case, I am of the considered view that the insurer should pay 75 % of the insured amount to the complainants, without any interest on that amount, provided payment is made in a time-bound manner. Such an order, in my view, would meet the ends of justice since there will be some penalty for not disclosing the habit of smoking to the insurer and at the same time it will not fully deny the benefit of the insurance policy to the legal heirs of a person who did not pay the full premium applicable in his case.

17                                 The complainant argued that in light of the above decision of Hon'ble National Commission the opposite parties are liable to pay at least 75% of the total claimed amount on non-standard basis presuming it to be violations of terms and conditions of the policy. From the above discussion and in light of the decision of the Hon'ble National Commission, we are of the considered opinion that if it presumed that the deceased Gurshinder Singh or his wife/complainant have not disclosed the habit of taking alcohol by Gurshinder Singh at the time of purchase of policy and it is violation of terms and conditions of the policy,  then, in that case also, the opposite parties cannot repudiate the claim of the complainant. As it is admitted that deceased Gurshinder Singh was insured under the policy in question and had paid premiums, as such, it should be decided on non-standard basis and the opposite parties are liable to pay 75% of the claimed amount to the complainant.

Complaint No. - 294 of 2017

Hence, the present complaint in hand is hereby allowed and opposite parties are directed to pay 75%  against both the policies in question i.e 75 % for  Insurance Policy No.132431755 which is for Rs.5,50,000/- and 75% for another insurance policy no.132464255 worth Rs.3,50,000/- alongwith interest @ 9% per annum from the date of filing the present complaint till final realization. Further opposite parties are directed to pay Rs.3000/-(Three thousands only) as litigation expenses to the complainant. Compliance of the order be made within 30 days of receipt of the copy of the order, failing which, complainant shall be entitled to initiate proceedings under section 25 & 27 of the Consumer Protection Act. Copy of the order be supplied to the parties free of costs. File be consigned to record room.

Announced in Open Forum

Dated 5.02.2019

 

(Param Pal Kaur)           (Ajit Aggarwal)

Member                         President