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NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION, NEW DELHI
AVM J. Rajendra AVSM VSM (Retd.), Presiding Member and Anoop Kumar Mendiratta, Member
Kanta – Complainant
versus
Life Insurance Corporation and Ors. – Opp. Parties
Consumer Complaint No.2015 of 2019
Decided on 8.9.2025
Consumer Protection Act, 1986 – Section 21 – Insurance Act, 1938 – Section 45 – Insurance – Life Insurance Policy – Repudiation of death claim on the ground of suppression of material facts in Proposal Form – Deceased Life Assured was aged about 36 years at the time of issue of policy and was examined by doctors empanelled by Life Insurance Corporation prior to issue of policy – On examination by Cardiologist, no abnormality was detected – There is no co-relation as to cause of death (cardiac arrest) vis-a-vis homeopathic treatment undertaken by Deceased Life Assured for bronchitis – There is no evidence on record if owing to treatment for bronchitis at Homeopathic Centre, lungs or any other organ of Deceased Life Assured had been impacted in any manner or temporary ailment suffered by him was life threatening – Burden was on Insurance Company to prove in case treatment for bronchitis in any manner adversely impacted or led to development of COPD – If there has been any suppression or incorrect disclosure of material facts which would have bearing upon the issue, Insurer would have considered it appropriate to not to assume risk proposed – Questionnaire in proposal form requiring specific disclosure of pre-existing ailments is only to enable Insurer to arrive at a considered decision based on actuarial risk – Cause of death of Deceased Life Assured due to cardiac arrest is totally unrelated to any treatment undertaken by him for bronchitis – Insurance Company has made all possible efforts to repudiate a genuine claim – Insurance Company directed to pay policy amount of Rs. 1,00,00,000/- to Complainant along with 6% simple interest, as well as Rs. 50,000/- as costs of litigation. (Paras 12, 14, 15, 16, 17,
18, 19, 20 and 21)
Result: Consumer Complaint allowed.
JUDGMENT
AVM J. Rajendra AVSM VSM (Retd.), Presiding Member—The present Consumer Complaint has been filed under Section 21 of the Consumer Protection Act, 1986 (for short ‘the Act’) against the Opposite Parties seeking to direct the OPs:—
‘(a) The Opposite Parties be directed to pay a total sum of Rs.1 crore along with Interest @18% pa on the said amount from the date of death till actual realization to the Complainants on account of unfair trade practice and deficiency in service,
(b) Rs.10 Lacs as compensation on account of mental harassment and agony suffered by the Complainants,
(c) Rs.50,000/- as litigation costs.’
2. Brief facts, as per the complaint, are that on 16.04.2017, the Complainant’s husband (Life Assured) submitted a Proposal Form to the OP, Insurer seeking a Life Insurance Policy for Rs.1 Crore on an annual premium @ Rs.18,400/- for a period of 20 years. The risk under the policy commenced from 18.05.2017. As per the Proposal Form, he maintained good health with sober habits (non-smoker and nonalcoholic). On 29.04.2017, The OP’s empanelled doctors conducted ECG and Treadmill Tests at Jaipur, and all parameters were reported to be normal. Later, a Medical Examiner’s Confidential Report dated 29.04.2017 was issued by the OP stating that all the health parameters were normal, except for imperfect eyesight. Based on its medical evaluation, OP issued Policy No. 895830099 dated 18.05.2017 in his favour. On 23.12.2017 at 12:22 PM, the Life Assured died of sudden cardiac arrest at Jaipur. The Complainant submitted the death claim under the policy to the OP on 20.01.2018 in the prescribed format, along with a Medical Attendant’s Certificate dated 11.01.2018 which recorded in column 5(a) that the habits of the Life Assured were sober, and in column 5(b) that the attack was not caused or aggravated by any intemperate habits. Surprisingly, vide letter dated 08.03.2018, the OP wrote to the concerned Police Station enquiring whether any FIR or complaint under the Domestic Violence Act had been lodged against the Deceased Life Assured (DLA). In response, it was confirmed that no such complaint or FIR was ever registered against him. Subsequently vide letter dated 12.07.2018, OP sought comments from Dr. Arun Mathur regarding the DLA’s treatment. In response, Dr. Mathur stated he treated the DLA with homeopathic medicine for chronic bronchitis, which relieved symptoms in 3 to 4 months. He clarified that such treatment, typically used for cough and flu-like symptoms, had no connection with the cause of death or any alleged suppression of material fact. He further stated that the said homeopathic treatment was undergone by the DLA. It is the case of the Complainant that despite the above, on 08.10.2018, the OP repudiated her claim on the ground that there was suppression of material facts in the Proposal Form, specifically the omission of disclosure regarding undergoing homeopathic treatment and availing sick leave by the DLA. Aggrieved by the said repudiation, she filed the present complaint.
3. Upon notice, the complaint was resisted by the OPs by filing their Written Statement contending that the complaint did not raise any valid consumer dispute as defined under the Act, and that this Commission lacked jurisdiction to entertain the complaint. It was asserted that the claim was rightly repudiated on valid legal grounds due to deliberate non-disclosure of material facts by the DLA at the proposal stage, and thus, there was no deficiency in service. OPs contended that it had the statutory right to call into question a policy within three years of issuance, in case of misstatement or suppression of material facts. In the present case, the date of commencement of the policy was 18.05.2017 and the DLA expired on 23.12.2017, i.e., within seven months from the commencement date, and hence the OP was within its legal right to repudiate the claim. OP contended that the DLA had suppressed material facts, namely, that he was under regul
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