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Life Insurance Corporation of India Through Its Zonal Manager, Life Insurance Corporation Of India, New Delhi v/s Rajendra Sudamrao Shinde & Another


Company & Directors' Information:- O LIFE PRIVATE LIMITED [Active] CIN = U52399PN2013PTC146147

Company & Directors' Information:- THE NEW INSURANCE LIMITED [Strike Off] CIN = U66010UP1933PLC000509

Company & Directors' Information:- RAJENDRA LIMITED [Strike Off] CIN = U99999KA1943PLC000306

Company & Directors' Information:- RAJENDRA CORPORATION PRIVATE LIMITED [Strike Off] CIN = U17219TZ1948PTC000161

    Revision Petition No. 2529 of 2019

    Decided On, 13 February 2020

    At, National Consumer Disputes Redressal Commission NCDRC

    By, THE HONOURABLE DR. S.M. KANTIKAR
    By, PRESIDING MEMBER

    For the Petitioner: Meghna Sankhla, Advocate. For the Respondents: ----------



Judgment Text


1. The revision petition has been filed under Section 21(b) of The Consumer Protection Act, 1986, hereinafter referred to as the ‘Act’, challenging the Order dated 22.08.2019 of the Maharashtra State Consumer Disputes Redressal Commission, Mumbai hereinafter referred to as the ‘State Commission’.

2. Brief facts relevant for the disposal of the case are that the complainants, alongwith their two children, had taken a policy (Policy No. 925914442) from the OP under Health Protection Plus Plan. The sum assured was Rs. 2,00,000/- each. Four premiums amounting to Rs. 1,00,000/- was paid by the complainants. As per the policy in question, the complainants and their children were entitled for re-imbursement of medical expenses and expenses for surgery amounting to RS. 2,00,000/- each. Thereafter, the complainant no. 2 underwent a surgery for breast cancer and incurred an expense of Rs. 1,85,000/-. The complainants submitted a claim to the OP for the same. To this, the OP sent a letter sanctioning only Rs. 2,300/- stating the reason that medical expenses could not be sanctioned. Later, vide letter dated 30.10.2015, the OP repudiated the claim stating that entire hospital expenses could not be reimbursed as the policy was a Fixed Benefit Policy and not a medi-claim policy. Being aggrieved, the complainant filed a complaint in the District Forum.

3. The complaint was resisted by the OP by filing a written statement. It was contended that the policy was issued under Plan No. 902 and the terms and conditions were explained to the complainant. The policy in question was issued with the consent of the complainant. The complainants were only entitled to hospitalization expenses as per the terms and conditions. So, an amount of Rs. 2,300/- is sanctioned by the OP.

4. The District Forum, vide order dated 25.10.2017, partly allowed the complaint. It directed the OP to pay Rs. 1,83,466/- to the complainant being the expenses incurred for the surgery with interest @ 9 % p.a. till the said amount is paid to her. Compensation of Rs. 90,000/- towards physical and mental harassment and Rs. 5,000 towards cost of complaint was ordered to be paid by the OP to the complainant. It observed the following:

7. On sr.no.3/2 the complainant has produced copy of Health Protection Plus policy no. 925914442. Upon perusal of the said policy it is observed that the same is valid up-to 31/03/2032. Particulars of insurance cover are defined in the policy. It is mentioned under clause no. 3 thereof that – Daily Benefits (H.C.B.) Hospital Cash Benefit is available to complainant no. 1 and 2 and their two children @ Rs. 1,000/- each . As per cl. No. 4- (M.S.B.) Major Surgical Benefits Sum Assured is available @ Rs. 2,00,000/- each – to complainant no. 1 and 2 and their two children. Hence, as per the said policy, the complainant is entitled to receive the said Surgical benefit. It is not denied that complainants have paid the premiums @ Rs.25,000/- continuously for four years totaling to Rs. 1,00,000/- . OP has issued only cover note of the policy. As contended by the OP and as mentioned therein the policy is issued under Plan No. 902. But it is not seen that the terms and conditions of the said plan have been provided to the complainants. It appears that only cover note of the policy is provided to the complainants. The complainant has not produced copy of terms and conditions of the policy. But OP has produced terms and conditions of Plan no. 902. Surgical Benefit Annexure is annexed to the terms and conditions of policy. An annexure showing charges payable in each type of surgery is also annexed. The surgery for cancer cyst is not included in the said annexure. Therefore, according to OP the expenses claimed by complainants are not payable as per policy terms and conditions. The said fact has been mentioned in OP’s written statement. While repudiating the claim the OP has not stated that the claim is repudiated as it comes under Exclusion Clause. Hence, it can be said that the repudiation of claim is an after thought. It is not clearly mentioned in the Exclusion Clause of policy that the Benefit is not payable in case of cyst of cancer. Further, the OP has not contended that the said ailment was pre- existing.

Most importantly, the complainant has filled in the proposal form under Plan no. 901. OP has committed an error in issuing policy under Plan no. 902 whereas the proposal form is submitted under Plan no. 901. OP has not explained as to what are the terms and conditions of Plan no. 901. It is clear that the OP has suppressed this material fact. OP has issued policy under Plan no. 902 to the complainant. It is clearly stated therein that the Surgical benefit of Rs. 2,00,000/- can be allowed. Hence, the Forum is of the opinion that OP has committed deficiency in service in repudiating the claim of the complainants. While submitting the claim forms the complainant has attached bills amounting to Rs. 1,83,466/-. Complainant has also produced copy of Doctors certificate of surgery. Hence, the Forum is of the opinion that the complainants are entitled to recover insurance claim of Rs. 1,83,466/- @ 9 % p.a. interest .

- - -

(emphasis supplied)

5. Being aggrieved by the order of the District Forum, the OP approached the State Commission. The State Commission vide its order dated 22.08.2019, dismissed the appeal with Rs. 10,000/- as cost of litigation to be paid by the OP to the complainant. It observed:

6. - - - There is no evidence on record about the “Informed acceptance” of the terms and conditions by the insured and that the policy holder was knowing the details about the policy and benefits available under this policy.

7. We are of the considered opinion that selling the products of insurance to consumers in different names with terms of conditions that will pay less to the consumer , not giving the information to the consumer about that the policy may fetch less benefits as per the terms, not explaining the policy terms to the consumers in their own language and not seeking the “Informed acceptance” of the policy terms and conditions by consumers constitutes “Unfair Trade Practice” by the insurance company.

- - -.

6. Being aggrieved by the abovesaid order of the State Commission, the OP approached this Commission.

The cardinal doctrine applied in a contract of insurance is ‘uberrimae fides’ (utmost good faith). This kind of contract requires highest standard of good faith while material facts are disclosed as this would influence the decision of the other party. In the present case, the complainants took the policy only with the intention that their family would be reimbursed in case they incur any expense due to ill health. The complainants took the policy under the guidance of the agent. It is the responsibility of the OP to give a clear picture of the policy to the intending purchasers. The OP failed to do so. This certainly amounts to ‘deficiency in service’ as well as ‘unfair trade practice’ on the part of the OP.

7. I find the Order of the State Commission to be well-appraised and well-reasoned. The State Commission concurred with the findings of the District Forum. Within the meaning and scope of section 21(b), I find no grave error in ap

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preciating the evidence by the two fora below, as may cause to require re-appreciation of the evidence in revision. I note in particular the extracts of the respective appraisals made by the two fora quoted, verbatim, in paras 4 and 5 above. I find the award made by the District Forum (quoted in para 4 above), and as affirmed by the State Commission, to be just and appropriate. And, on the face of it, I find no jurisdictional error, or a legal principle ignored, or miscarriage of justice. 8. The revision petition, being misconceived and devoid of merit, is dismissed. 9. Needless to add that the District Forum shall undertake execution of its Order as per the law. 10. A copy each of this Order be sent to the District Forum and to the complainant by the Registry within ten days.
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