Life Insurance Corporation of India vs Shaukeen

THIS is an appeal against the judgment and order dated 25.11.2000 passed by District Consumer Forum, Rampur in Complaint Case No. 210/1997.

BRIEFLY stated the facts of the case are as follows : The complainant''s father late Sri Ali Ahmad had taken a Life Insurance Policy of Rs. 10,000/- from the opposite party on 24.8.1995. Half-yearly premium of Rs. 392/- was to be paid by the complainant''s father. The first premium of Rs. 392/- has been paid to the opposite party. The complainant''s father died on 5.12.1995. The information of the death was given by the complainant, the nominee in the policy to the opposite party. Thereafter the complainant has been approaching the opposite party time and again for settlement of the insurance claim but with no result. The complainant even gave a legal notice through his Advocate to the opposite party on 23.5.1996. The opposite party, Life Insurance Corporation of India then asked for certain documents from the complainant. The documents were sent on 28.9.1996. The opposite party asked for copy of voters list which too was submitted but the claim has not been settled even after 1 years which was deficiency on the part of the opposite party. The officials of the opposite party have been demanding money from the complainant for settlement of the claim and if the money is not given the claim will be repudiated. The complainant, therefore, lodged a claim before the District Forum seeking the amount of insurance along with 24% interest per annum. Besides this, a compensation of Rs. 50,000/-, Rs. 1,000/- for correspondence and Rs. 2,200/- as cost was also claimed. In the written statement before the Consumer Forum, the opposite party, Life Insurance Corporation of India admitted the insurance and the receipt of first premium of Rs. 392/- against the policy on 31.8.1995, the receipt for which was issued on the same day. It is also admitted that the complainant was the nominee of the deceased. The allegation of the complainant that the money was demanded by the officials was baseless and highly defamatory. It was also stated that it was the duty of the insured to mention each and every information rightly and if any concealment of any material fact is found then the contract of insurance will be void and all the premium paid by the life assured are to be forfeited in view of Section 45 of the Insurance Act. In para 4 of the written statement, it has been stated that if the death of the person occurs within two years from the date of commencement of policy, the Life Insurance Corporation of India is required to investigate all the matters thoroughly and satisfy itself about the genuineness of the claim. The complainant informed the opposite party about the murder of the person assured on 5.12.1995 through his letter dated 26.4.1996. Since this was an early claim the Life Insurance Corporation of India had to investigate the matter thoroughly and came to know that the person assured had grossly understated his age in his statement at the time of proposal. The actual age of the person assured was 65 years at the time of proposal but it was shown intentionally and malafidely as 45 years. If the correct age had been shown by the person assured then the insurance policy would not have been given. The policy was thus taken by the person assured by playing fraud upon the Life Insurance Corporation of India. This fact was also evident from the post-mortem report and the voters list in which the age of the person assured has been shown as 65 years. The claim was, therefore, rightly repudiated under Section 45 of the Insurance Act and the complainant was informed of the repudiation on 26.11.1997. The repudiation was done with full application of mind.

In the complaint case before the District Consumer Forum the agent concerned of the Life Insurance Corporation of India was also made opposite party. This opposite party No. 3 in his written version before the District Forum has stated that he is not concerned with the settlement of claim. The agent also stated that the copy of voters list was asked from the complainant which has not been deposited in the office by the complainant and, therefore, the payment against the policy has not been made.

THE parties led evidence in the form of affidavit and copy of other documents before the District Forum. After hearing both the parties, the claim was decreed by the District Forum and the opposite party was directed to pay to the complainant an amount of Rs. 10,000/- as the amount assured along with interest at the rate of 18% per annum with effect from 18.12.1997. A compensation of Rs. 2,000/- and cost of Rs. 500/- for proceedings before the District Forum were also awarded. Aggrieved of this order, the opposite party, Life Insurance Corporation of India has come in this appeal.

WE have heard the arguments of the learned Counsels for the two parties. The learned Counsel for the appellant has argued that the Insurance Company has repudiated the claim after going through the matter available on record and the record of the policy and had applied its mind in good faith. The Life Insurance Corporation of India came to the conclusion that the insurance was obtained with fraudulent intention as the real age of the life assured was concealed in the proposal form. The age of the life assured was shown as 45 years while the correct age was 65 years. If the correct age had been shown the life assured would not have been eligible for the insurance. He further argued that the age of 65 years has been proved by the post-mortem report and the copy of voters list. Thus the incorrect disclosure of age was an act of malafide intention on the part of the life assured. The learned Counsel for the respondent has argued that in the proposal form the age was shown as 45 years and since it was a medical policy the Doctor also gave a certificate. The proposal form was not filled up by the life assured and it was filled up by the agent concerned of the opposite party and the life assured had only signed. It was for the agent and the Doctor to have ascertained the correct age. The rural people were not educated and generally give very vague information about the age. The learned Counsel for the respondent has further argued that in the particular case age factor is not important because the life assured was murdered and since it was a case of murder, age does not matter. From the above facts, it will be revealed that the dispute in the case is only that of age. The case of the appellant is that the age was highly understated and if it had been correctly stated there could have been no insurance of the person assured. A perusal of the copy of the proposal for insurance will go to show that the form has not been filled up by the person assured, rather it has been filled up by the agent of the opposite party who is opposite party No. 3 in the complaint case. The person assured has signed in Urdu and, therefore, he was not aware as to what age has been filled up by the agent concerned, opposite party No. 3. The Doctor of the opposite party also verified the declaration form by the proposer. A perusal of the post-mortem report Annexure 2 of the memo of appeal does reveal that on page 2 wherein the age of the person assured has been written as 65 years and the cause of death was murder and not any other disease. Annexure 3 of the memo of appeal is the voters list in which the age shown is also 65 years. Annexures 4 and 5 are the statements taken by the opposite parties of certain persons of the village wherein it has been stated that the complainant''s father, the life assured had an altercation with the other local villagers and in that he sustained injuries and while being taken to the hospital he died. It is, therefore, clear that the life assured was not suffering from any disease and it was a case of murder. Now the question is the age as shown in the post-mortem report and the voters list should be determining factor for repudiation of the claim. As said above the declaration form and the proposal form is not in the handwriting of the deceased. All entries have been made by the agent concerned. In the declaration form the Doctor gave a certificate. It was the duty of the opposite party to have ascertained the correct age at the time of filling up the forms. The opposite party No. 3 has stated before the Forum that the complainant was asked to submit the voters list in the office of the Life Insurance Corporation of India in order to process the claim. If the opposite party No. 3, the agent of the opposite party had been vigilant about making correct entries then he could have asked for the voters list at the time of filling up the form. No doubt the insurance is a contract in good faith but that does not mean that at the stage of making proposal the agent and Doctor should ignore the genuineness of otherwise of the information orally furnished by the person assured. Therefore, the case or submitting fraudulent information is not proved. In the process the claim should not have been repudiated by the Insurance Company. Moreover, the fact that the age of 65 years has been entered in the post-mortem report may be based on the information given by the local person as per the voters list and it is not quite true that whatever information is written in the voters list is always correct. Again presuming that the person insured was of 65 years of age at the time of taking insurance, if the post-mortem report is believed, on what basis the age of 45 years was entered into by the agent and the same certified by the Doctor who are both the authorised persons of the opposite party. Therefore, the appellants have not been able to prove that there was intentional and deliberate attempt on the part of the person insured to commit any fraud and submit false information. It is, therefore, not established that the person insured had with a malafide intention submitted false information to seek insurance policy. All these aspects of the matter have been sufficiently dealt with by the District Forum and the Forum has come to the right conclusion. In the circumstances, there is no justification to interfere with the judgment and order of the District Consumer Forum and same is liable to be confirmed and the appeal is liable to be dismissed. ORDER

THE appeal is dismissed. THE judgment and order of the District Consumer Forum are confirmed. THE appellant shall pay a sum of Rs. 2,000/- as cost to the complainant. Let compliance of this order be made within a period of six weeks from the date of this order. Let copy of this order be made available to the parties as per rules. Appeal dismissed.