BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION AT BANGALORE (URBAN)

DATED 13^th DAY OF OCTOBER 2023

ORDER

SMT. SUMA ANILKUMAR, MEMBER

The complaint filed by the complainant U/S 35 of Consumer Protection Act 2019, seeking direction towards OP for the following reliefs:-

1. To direct OP’s to pay a sum of Rs.40,39,000/- (fort lakh thirty nine thousand only) to the complainant.
2. To pay interest on the claim amount at the rate of 18% from the date of claim till payment.
3. To direct the OP’s to pay the compensation of Rs.50,000/- to the complainant and to grand such other relief/s to which the complainant may be found entitled to under the circumstances of the case including award of the cost in the interest of justice and equity.

2. Brief facts of this case are as follows:-

The complainant Smt. Lakshmi.S submits that the complainant husband late Sri. Shiva .M.R (herein after referred as insured) had obtained SLS housing loan plan for sum of Rs.40,39,000/-. Thereafter the complainant’s husband had opted the SUD Life Sampoorna Loan Suraksha (Non-linked, non participating group credit life insurance plan) under (SUD life policy No.510032440) with the OP company for a total amount of Rs.40,39,000/- (rupees forty lakh thirty nine thousand) and had paid the total premium amount of Rs.88,791.46/- in favour of OP No.1 and signed by OP No.2 and insured premium receipt dated 17.03.2020, effective from 17.03.2020 till 16.03.2030. The complainant submits that persuant there to the insurance was issued by the OP with certificate of insurance having the master policy No.MR001022 dated 17.03.2020 and insured number ID No.29146066 (SUD life policy No.510032440) in the name of the insured. The said policy was for a term of 10 years and covered from 17.03.2020 to 16.03.2030. The insured had named his wife as “nominee” (complainant) in the said insurance.

 3. The complainant submits that as per the terms of the insurance policy, in case the insured of the policy dies during the policy and whilst the insured members coverage under the master policy in force, the OP would pay the sum assured (as per the loan scheduled in the certificate of insurance) i.e., the loan outstanding as per the loan scheduled at the beginning of the policy month during  which the death occurs.

 4. The complainants husband i.e., the insured, late Sri. Shiva M. R made regular payments towards the specifications of the housing loan. During the subsistence of insurance cover issued by OP, the insured late Sri. Shiva M. R succumbed to Covid-19 decease on 03.10.2020 at the C.V Raman general Hospital, Indiranagar, BBMP, Bangalore, Karnataka. After performing the final rituals of the insured, the complainant being nominee of the said insurance policy secured the necessary documents relating to the cause of death of the insured and raised claim in the month of October 2020 with the OP. Due to death of insured the complainant is facing huge financial problem and has responsibility of 3 children aged between 18-22 and not able to maintain educational and daily expenses.

 5. The complainant submits that after receiving the claim petition, the insurance team led by the OP had investigated into the said claim and after satisfied with all the terms and conditions as prescribed in the certificate of insurance, the OP through insurance team assured complainant that the claim would be proposed and disbursed within a period of 45 days. However the OP’s have failed to make any payments under the said claim. The complainant made several reminders to OP dated 20.09.2021, 12.09.2022 finally after complaint made to the IRDAI the OP has issued letter dated 29.07.2022 requesting and assuring that the matter will be stated within 15 days but till today the OP has not paid the assured amount. The complainant submits that she sent a legal notice through her advocate on 14.10.2022 to the first and second OP with demand to settle her claim, the OP has give untenable reply for the said legal notice dated on 07.11.2022. “The OP stated that in para No.3 of their reply notice, dated that the deceased died on 03.10.2020. On receipt of claim intimation the claim was investigated and subsequently repudiated on the ground of suppression of material information related to health. The reason of repudiation was duly communicated through the letter dated 06.01.2021 delivered at your clients address”, but the complainant did not receive any repudiated letter by the OP and have got to know about the repudiation of claim only by OP’s reply through legal notice and E-mail. The insured has never suppressed any health related information with the OP and has died on 03.10.2020 due to Covid-19 as per the medical records issued by the Government authorities. Hence further that the OP has no reason to repudiate the claim of the complainant. Therefore the OP has committed deficiency in service by not settling the claim assured under the policy. Hence this complaint by the complainant.

6. On issuance of notice to OP No.1,2 & 3, OP No.1 filed their version, OP No.2 fails to submit his version, OP No.3 placed Ex-parte.

7. In the version of the OP No.1, OP No.1 agrees to the fact that membership form bearing No.510032440 and the customer declaration form along with other necessary documents, on the basis of information provided life coverage under policy i.e, “SUD Life Sampoorna Loan Suraksha” was issued by the OP to the DLA i.e., Deceased Life Assured, the DLA was enrolled in the group policy as the insurd member and was issued certificate of insurance bearing No.MR001022-2257700. The OP further submits that on 25.11.2020, OP received the death claim intimation from the complainant, herein who is the nominee and wife of DLA under the said policy. As per the claim intimation received by OP, the DLA had died on 03.10.2020. Being the early death claim, the OP in terms of Section 45 of Insurance Act 1938, had investigated the matter and the same had covered sum glaring findings as under:-

a) As per the medical documents received from St. John’s Medical College Hospital, Bangalore, it was found the insured member was diabetic since 2017 and was admitted from 07.01.2017 to 17.01.2017, for debridement of his right index finger caused due to uncontrolled diabetes.

b) In addition, the deceased underwent a plastic surgery on right index finger cellulitis with gangrene of tip.      

8. The OP submits that DLA did not disclose the above said medical history in “Section D: health details of life to be assured” of the membership form. Furthermore, the deceased DLA gave a false declaration “Section E: declaration by group member”, of the membership form. The material information was not disclosed by the DLA at the time of filling up the membership form dated 11.03.2020. It is therefore submitted that since the life assured deliberately mislead the company to issue the policy by concealing material information which was very essential for under reading the proposal for life insurance. The OP vide letter dated 06.01.2021 had repudiated the claim of the complainant on the ground of suppression of material information related to health.

9. Aggrieved by such lawful rejection by OP, the complainant has sent false and frivolous legal notice dated 14.10.2021, the contents of which were duly refuted and replied upon by the OP herein vide letter dated 07.11.2022. The OP further submits that in such circumstances no prudent man would agree that the life assured was healthy, individual at the time of proposing the policy as all reliable facts speaks for it. This is fit case for famous doctrine Res Ipsa Loquitor “The thing speaks for its”. The life assured deliberately mislead the company to issue the policy by concealing material information. Therefore OP submits that present complaint is false, sham and bogus to the core as complainant has failed to establish the deficiency of service against OP. The complainant is not entitled to the death claim amount of OP Rs.40,39,000/- along with interest at 18% per annum. Further Rs.50,000/- of compensation to the complainant. Complainant is not entitled to any relief whatsoever.

10. The complainant in her contention has filed affidavit evidence along with 15 documents marked as Ex.P.1 to Ex.P.15. OP No.1 has filed 7 documents. OP No.3 placed Ex-parte. OP No.1 and complainant filed their written arguments. Heard both the parties.

11. On the basis of above pleadings for our consideration are as follows:-

i) Whether the complainant proves the deficiency of service on the part of OP?

ii) Whether complainant is entitled for the relief?

iii) What order?

12.  Our answers to the above points are as follows:-

Point No.1:- In the affirmative.

Point No.2:- Partly affirmative.

Point No.3:- As per the final order.

REASONS

13. Point No.1&2:- These points are inter-connected to each other and for the sake of convenience, to avoid repetition of facts, these points are taken up together for common discussion.

14. The OP agrees to the fact that the complainant’s husband had taken a “SUD Life Sampoorna Loan Suraksha” policy No.510032440 for a total amount of Rs.40,39,000/- and had paid total premium amount of Rs.88,791.46/- as per the certificate of insurance marked as Ex.P.2. The OP has issued premium receipt dated 17.03.2020 and the insurance is effective from 17.03.2020 till 16.03.2030. The OP has also issued the certificate of insurance for policy dated 17.03.2020 bearing No.MR001022 and the insured member ID No. 29146066 (SUD Life policy No. 510032440) in the name of insured for the said term period of 10 years which is covered from 17.03.2020 to 16.03.2030. According to the Medical Certificate of cause of death i.e, Ex.P.5 submitted by the complainant, the cause of death of the complainant’s husband Sri. Shiva M.R is due to Covid positive. Covid-19 being a pandemic decease, many around the world have been affected and lost life which was unpredicted by anyone. The said Sri Shiva M.R has died due to Covid-19 which was unexpected and unpredicted by his family. The death date is on 03.10.2020 which is well within the term period of the policy taken by Shiva i.e., from 17.03.2020 to 16.03.2030.

15.  Sri Shiva’s wife Smt. Lakshmi being the nominee of her husband’s policy as per the Ex.P.1 is the rightful claimant for the claim amount against the policy taken. Hence OP is directed to pay the total policy claim of Rs.40,39,000/-. Hence we answer Point No.1&2 accordingly.

16. In view of the discussion referred above, we proceed to pass the following:-

ORDER

1. Complaint filed U/S 35 of Consumer Protection Act, is hereby allowed in part.
2. OP is directed to pay the claim amount of Rs.40,39,000/-.
3. OP is further directed to pay compensation of Rs.25,000/-  along with Rs.10,000/- towards litigation cost. OP is directed to pay the total Award amount within 60 days from the date or order, failing which OP is liable to pay interest at the rate of 10% on Award amount till realization.

4. Furnish the copies to both the parties without cost.

(Dictated to the Stenographer, got it transcribed and corrected, pronounced in the Open Commission on this 13^th day of OCTOBER, 2023)

Documents produced by the Complainant-P.W.1 are as follows:

Documents produced by the representative of opposite party – R.W.1;