advantageconsumer.com Consumer Protection Council, Rourkela

Important judgements passed by the Consumer Courts Insurance benefits denied as the insured had concealed material fact at the time of obtaining the Insurance Policy. NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION, NEW DELHI REVISION PETITION NO. 2890 OF 2014 (Against the Order dated 28/03/2014 in Appeal No. 393/2013 of the State Commission Andhra Pradesh)                                          SBI LIFE INSURANCE CO. LTD. CENTRAL PROCESSING CENTRE. KAPAS BHAWAN, PLOT NO-3A, SECTOR-10, CBD BELAPUR, NAVI MUMBAI - 400614 MAHARASHTRA                                                ...........Petitioner(s)                                                    Versus     DUNE BHAGYALAKSHMI W/O LATE SURYANARAYANA, R/O D.NO-10-417, ESWAR NAGAR, 1ST STREET, KAKINADA                                                       ...........Respondent(s) BEFORE:          HON'BLE MR. JUSTICE AJIT BHARIHOKE, PRESIDING                  MEMBER      HON'BLE MRS. REKHA GUPTA, MEMBER Dated : 05 Apr 2016 ORDER 1.       Cost for adjournment has been paid. 2.       Petitioner insurance company being aggrieved of concurrent findings of the Fora below directing him to pay to the respondent/complainant a sum of Rs.4,52,916/- together with 9% interest from the date of complaint i.e. 15.2.2012 till the date of realization besides cost of Rs.2,000/-, has preferred this revision petition. 3.       Undisputed facts relevant for the disposal of the revision petition are that the husband of the respondent/complainant was insured with the petitioner/insurance company under a master insurance policy obtained by the State Bank of India from which the insured had taken loan. The insurance cover extended to the husband of the respondent was valid w.e.f. August, 2009. The insured died because of cardiac arrest on 23.3.2011. The respondent being widow of the insured/legal heir preferred the insurance claim which was repudiated by the insurance company on the premise that the insurance policy was obtained by the insured by concealing material fact i.e. that he has suffered the attack of Angina in June, 2008. 4.       Being aggrieved of the repudiation of the insurance claim the respondent raised a consumer dispute before the East Godavari District Consumer Forum. The District Forum on consideration of pleadings and the evidence found the petitioner insurance company deficient in service and directed the petitioner to pay the insurance claim as recorded above. 5.       The petitioner being aggrieved of the order of the District Forum preferred an appeal. The State Commission, Hyderabad, however, did not find merit in the appeal and affirmed the order of the District Forum. This has led to filing of the revision petition. 6.       Short point involved in this revision petition is whether or not the late insured obtained the insurance policy by concealment of material fact? In this regard learned counsel for the petitioner has taken us through the proposal form wherein in response to the medical questionnaire containing 10 questions the insured had answered in negative. In response to the question whether the insured had ever been treated for diabetes, high blood pressure, heart attack, chest pain or any other heart disease, the insured had answered in negative. Learned counsel for the petitioner has contended that the respondent had concealed while answering the question in the proposal form that he had suffered chest pain diagnosed as Angina in June, 2008 and in this regard he has referred to the photocopy of his treatment record during the period 1.6.2008 to 2.6.2008 at Safe Emergency Hospital. On perusal of those documents it is clear that the respondent in June, 2008 had visited said hospital and taken treatment for chest pain which was diagnosed as Angina. This fact obviously has been concealed by giving a wrong answer to the specific question asked in the proposal form. Thus, it is clear that the insured obtained the insurance policy by misrepresentation and concealment of material fact i.e. he had suffered from Angina and taken treatment for the same. As per the record the insured died because of heart attack which has direct nexus with Angina. Thus, this is a clear case of obtaining insurance contract by concealing material fact and as such in view of the judgment of the Hon’ble Supreme Court in the matter of Satwant Kaur Sandhu Versus New India Assurance Company Limited (2009) 8 SCC 316 and the judgment of this Commission in the matter of Kokilaben Narendrabhai Patel Vs. LIC of India 2010 CTJ 920 (CP) (NCDRC) as also The Marketing Manager, LIC of India Vs.Smt. Vijaya, CPC (1995) (1) 341, the insurance company was within its right to repudiate the claim.           Both the Fora below have ignored the aspect of concealment of material fact for obtaining the insurance policy. Therefore, the impugned order cannot be sustained.           In view of the discussion above, revision petition is allowed, impugned order is set aside and complaint is dismissed.           The amount, if any, deposited by the petitioner as a pre-condition to the stay may be released to the petitioner after the expiry of period of filing of appeal or disposal of appeal, if any.                                                                                               Top

Consumer Protection Council, Rourkela