IMPORTANT POINT
Before Insurance Co. succeeds in its stand to repudiate claim under life insurance policy, suppression of material or wrong answer must have some direct bearing or nexus to ultimate cause of death.

Jasbir Kapoor, Member—This is an appeal by L.I.C. against the judgment of the District Forum, Amritsar dated 14.3.2007 by which the complaint of the complainant was accepted in the following terms:-

“In view of the above discussion and the law laid down by the Hon’ble Maharashtra State Commission in which an authority of the Hon’ble National Commission was also discussed; we are of a very clear view that the insurance claim of the complainant was illegally and unjustly repudiated by the opposite party without bringing any cogent and convincing evidence on record to justify the grounds taken in the repudiation letter. We, therefore, find no impediment in the way of allowing the present complaint, which is partly allowed and opposite party is directed to pay the sum assured with vested bonus, as applicable to the two policies taken by the deceased assured, to his wife Smt. Satinder Kaur along with interest at the rate of 8% per annum from the date of repudiation of the claim till payment of the amount. Opposite party would also pay Rs. 1000/- as litigation expenses to the complainant within a period of one month from the date of receipt of copy of the orders by way of bank draft or account payee’s cheque; failing which proceedings u/s 27 of the Consumer Protection Act would be initiated against the opposite party. This amount would be deposited in the FDR in any Nationalized bank of the choice of the complainant, initially for a period of one year. She can withdraw monthly or quarterly interest on this amount. Copies of the orders be furnished to the parties free of costs. File is ordered to be consigned to the record room.”

2. Brief facts of the case are that the respondent-complainant—Smt. Satinder Kaur’s(hereinafter referred to as ‘the complainant’) husband had taken two policies bearing Nos. 130092574 and 130092575 dated 15.7.2004 and paid the premium through his employer i.e. PAP. The husband of the complainant felt pain in his chest and stomach on 9.1.2005 and immediately admitted to Mata Kaulan Hospital, Amritsar and then referred to Escorts Heart and Super Speciality Institute on 10.1.2005 where he died on 12.1.2005. The death of her husband was due to Cardio Respiratory Arrest, as per certificate of the Escort Hospital. It was stated that after the death of her husband; due information and insurance claim along with documents was given to the opposite party for settlement of the claim. On 13.3.2006, the claim of the complainant was repudiated. It was stated that her husband was Teetotaler and not patient of Alcohol Pancreatitis before the date of proposal. It was stated that her husband was not suffering from any disease, for which he has answered no in proposal dated 15.7.2004 and not made any incorrect statement. It was prayed that opposite party be directed to pay Rs. 50,000/- of each policy(two policies) plus Rs. 50,000/- as compensation and also prayed for any other relief.

3. On notice, opposite party filed its reply and admitted the fact of two endowment policies but stated that complainant’s husband wilfully concealed his health condition in the proposal of assurance dated 15.7.2004 and given wrong and false answer to the questions like never used alcohol drinks. Life assured had died on 12.1.2005 i.e. within six months from the date of acceptance of risk. It was further stated that on receiving the claim papers it was observed that both the policies were lapsed on the date of death of the life assured so the claims were not acceptable. On investigation, it was found that life assured was alcoholic, admitted in the Hospital and from the treatment record the life assured had expired due to infected Pancreatic Necrosis, ARDS, Acute Renal Failure and Alcoholic hypotention. It was further stated that as per opinion of the medical expert Acute Pancreatitis can occur especially to an alcoholic. It was stated that life assured had tried to play fraud to grab the public money for his legal heirs. It was stated that