IMPORTANT POINT
Death claim cannot be repudiated for suppression of minor ailments.

Mrs. Vineeta Rai, Member—This Appeal has been filed by Smt.Kamna Bajpai, Appellant herein and original complainant before the State Commission being aggrieved by the order of the State Consumer Disputes Redressal Commission, Uttar Pradesh (hereinafter referred to as the ‘State Commission’) which had only partly allowed her complaint. Life Insurance Corporation of India, opposite party before the State Commission is Respondent herein.

2. The facts of the case are that the late husband of the Appellant, Shri Satya Prakash Bajpai(hereinafter referred to as the ‘life assured’) had taken three life insurance policies with accidental benefit from the Respondent/Insurance Corporation for Rs.1 lakh each plus accident benefit of Rs.1 lakh in the years 1994, 1997 and 1998 respectively. The Appellant was the nominee in respect of all these policies. On 11.05.1999, Appellant’s husband while changing an electric bulb by standing on a stool in his house fell down and sustained serious head injuries for which he was hospitalized. He expired on 16.05.1999 at the Gandhi Memorial & Associated Hospitals, Lucknow. Post-mortem of the deceased concluded that the cause of death was the result of anti-mortem head injuries. The Appellant as the nominee of the life assured filed her claim along with all the necessary documents in respect of all three policies for the assured sum of Rs.3 lakhs plus accident benefit of Rs.3 lakhs, totaling Rs.6 lakhs. However, Respondent/Insurance Corporation repudiated all three claims vide their letter dated 25.02.2002 on the grounds that the deceased had given incorrect replies in the Insurance Proposal Form regarding his health. Being aggrieved, Appellant filed a complaint before the State Commission on grounds of deficiency in service and requested that Respondent/Insurance Corporation be directed to pay her Rs.6 lakhs as insurance claim including accidental benefit with interest @ 18% per annum and Rs.50,000/- as litigation costs.

3. Respondent on being served put in appearance and contended that the claim was rightly repudiated since the deceased had made deliberate mis-statements and suppressed material information regarding his health at the time of taking/reviving the insurance policies because there was indisputable evidence to show that he was suffering from hypertension and acute enteritis for which he had taken medical treatment from the years 1995 to 1998 and also medical leave for on 4 occasions ranging from 2 to 6 days. These facts were not disclosed in the insurance proposal form and since insurance is a contract based on the principle of ubberima fides i.e. utmost good faith, as per the terms of the insurance policy the claim was rightly repudiated.

4. The State Commission after hearing the parties and on the basis of evidence filed before it partly allowed the complaint by directing the Respondent/Insurance Corporation to indemnify the claim in respect of Policy No.211096229 taken in the year 1994 since at that time there was no evidence/medical certificate that the life assured had taken medical treatment for any ailment. However, the State Commission concluded that the Respondent was justified in repudiating the claims in respect of the other two policies since there was documentary evidence that the life assured was a patient of hypertension and enteritis for which he had taken medical treatment as also medical leave ranging from 3 to 6 days on at least 4 occasions and had suppressed this material information in response to specific queries regarding his health in the insurance proposal form.

5. Hence, the present First Appeal.

6. Counsel for both parties made oral submissions. Counsel for Appellant contended that the State Commission erred in concluding that the Respondent/Insurance Corporation was justified in repudiating the claim in respect of two insurance policies on the grounds that Appellant’s late husband had suppressed material information regarding his health in the insurance proposal f