Judicial Analysis Court Copy Headnote Facts Arguments Court observation

NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION, NEW DELHI
Subhash Chandra, Presiding Member and
AVM J. Rajendra, AVSM VSM (Retd.), Member
Max Life Insurance Co. Ltd. – Appellant
versus
Shalini Devendra Shasrakar – Respondent
First Appeal No.1653 of 2016
(Against the order dated 18.08.2016 in Complaint no. 55 of 2013 of the State Consumer Disputes Redressal Commission, Maharashtra)
Decided on 21.5.2025

Advocates:
Counsel for the Parties:
For the Appellant:Ms. Suman Bagga, Advocate
For the Respondent: Mr. Gaurav Barathi, Amicus Curiae

IMPORTANT POINTS
(1) Medical condition – There is a good possibility that the DLA was not aware of his medical condition prior to filling the Proposal Form and OP has not established anything to the contrary.
(2) Duty of disclosure – The duty of disclosure in insurance contracts is based on the principle of uberrima fides (utmost good faith).
(3) Burden of Proof – The burden of proving non-disclosure or misrepresentation of material facts lies on the insurer.

Headnote:
Consumer Protection Act, 1986 – Section 19 [Consumer Protection Act, 2019 – Section 51] – Appeal – Services – Medical Negligence – After careful consideration of the entire facts and circumstances of the case, it is evident that the OP did not establish that the DLA was in fact suffering certain medical conditions and he was aware of the same, prior to answering the questions in the Proposal Form for obtaining the insurance policy in question. This was imperative to determine whether the DLA answered such questions, knowing them to be false. Because, there is a good possibility that the DLA was not aware of his medical condition prior to filling the Proposal Form and OP has not established anything to the contrary – Thus, the duty of disclosure in insurance contracts is based on the principle of uberrima fides (utmost good faith). Any ambiguity in the proposal form or policy documents must be interpreted contra proferentem, i.e., against the insurer. The burden of proving non-disclosure or misrepresentation of material facts lies on the insurer – On fact, Appeal dismissed. [Paras 10 to 17]
Result:Appeal dismissed.

JUDGMENT

AVM J. Rajendra, AVSM VSM (Retd.), Member—This Appeal is filed by the OP under Section 19 of the Consumer Protection Act, 1986 (“the Act”), against the Order dated 18.08.2016 passed by the State Consumer Disputes Redressal Commission, Maharashtra at Nagpur (“State Commission”) in CC No. 55 of 2013, wherein the State Commission partly allowed the complaint filed by the Complainant/Respondent.

2. As per the Registry report, there is 64 days delay in filing this Appeal and in the interest of justice, the delay is condoned.

3. Brief facts of the case, as per the complainant, are that the deceased Devendra Wamanrao Shastrakar was the husband of the complainant, hereinafter referred to as Deceased Life Assured (DLA). He had paid the premium of Rs.13370.84 to the Opposite Party (OP) Insurer and obtained an insurance policy covering the risk of his life for sum assured of Rs.25,00,000. The period of policy was from 01/12/2012 to 01/12/2032. The said policy was issued after due medical examination of the complainant and conducting Pathological Tests of his blood and Urine. The DLA suffered swelling on his leg on 15/03/2013 and was taken to the hospital of Dr. Kolte. He was diagnosed with Jaundice and was admitted to hospital on 15/03/2013 and after treatment he was discharged on 21/03/2013 as he got relief. He died on 29/4/2013. The complainant gave the intimation of death of the DLA to OP and submitted claim along with necessary documents to the OP for the sum assured under the policy. The OP repudiated her claim vide letter dated 30/09/2013 on the ground that the DLA was admitted in Gurukrupa Nursing Home on 05/11/2012 due to suffering from Heart Disease. However, he was not suffering from any such heart disease on 05/11/2012 and therefore the repudiation of the claim is illegal. The complainant filed a complaint before State Commission seeking directions to OP to pay Rs.25,00,000 along with interest @ 12% per annum from 29/6/2013 till realization, pay compensation of Rs. 2,00,000 for harassment and Rs. 25,000 as costs.

4. On issue of notice, OP resisted the complaint by filing its written version. It was admitted that it issued policy to the DLA to cover risk of his life, and the period of that policy was from 01/12/2012 to 01/12/2032 and that DLA died on 29/04/2013. OP admitted that it received claim papers from her claiming the sum assured of Rs.25,00,000. It is the case of OP that on receiving claim papers from complainant, it conducted an investigation through M/s Transoft Solutions, who submitted first report on 08/08/2013 and second report on 21/08/2013. Thereafter, it reinvestigated the matter through Charter House and it was revealed that DLA was suffering from Congestive Cardiac Failure (CCF) with Coronary Artery Disease and that his CPK and MB levels were raised to 41 prior to signing the proposal by him for policy. He was an indoor patient of Gurukrupa Nursing Home on 05/11/2012 for the aforesaid disease and he was discharged on 09/11/2012. He was having low blood pressure and he was having history of Pedal Swelling and diagnosed to have CCF and DCMP (Dilated Cardio Myopathy). As per medical certificate obtained from Dr. Akhfaq Shaikh, the DLA was known to him for 10 years and he was suffering from Hypertension (HT) since last one and half years. The DLA suppressed said Pre Existing Disease before submitting proposal from for obtaining policy. Therefore, OP rightly repudiated the claim. OP requested that the complaint be dismissed with cost.

5. The learned State Commission vide its order dated 18.08.2016 directed as follows:—

“Order

i. The complaint is partly allowed.

ii. The opposite party (OP) is directed to pay to the complainant sum assured of Rs. 25,00,000/- with interest at the rate of 9 percent per annum from 30/09/2013 till its realization by her.

iii. The opposite party (OP) shall also pay to the complainant compensation of Rs. 1,00,000/- for physical and mental harassment and cost of Rs. 10,000/-.