The insured's obligation to disclose health status is limited to knowledge of such conditions, and unsubstantiated claims of suppression cannot invalidate a life insurance policy.

JUDGMENT :

S.K. PANIGRAHI, J.

1. Since common question of facts and law are involved in all the above-mentioned Writ Petitions, the same were heard together and are being disposed of by this common judgment. However, this Court felt it apposite to deal the W.P.(C) No.16722 of 2016 as the leading case for proper adjudication of all these cases.

2. The Petitioner/ Shriram Life Insurance Co. Ltd., in W.P.(C) No.16722 of2016, has made a prayer to quash the award dated 30.05.2016 passed in PLA Case No.319 of 2015 by the Permanent Lok Adalat for Public Utility Services, Ganjam at Berhampur directing the Petitioner/ Shriram Life Insurance Co. Ltd. to pay the death benefit under policy No.NP141400146244 with all benefits available under the said policy with interest @ 6% per annum from the date of application in favour of the present Opposite Party No.1 within a period of two months from the date of that order.

I. FACTUAL MATRIX OF THE CASE:

3. The facts narrated in the Writ Petition by the Petitioner/ Shriram Life Insurance Co. Ltd. are that the deceased-life assured (in short ‘DLA’) Sabitri Behera, mother of the Opposite Party No.1, had taken a life insurance policy i.e. “Shriram New Shri Raksha” bearing No.NP141400146244 from the Petitioner/ Shriram Life Insurance Co. Ltd. on 18.10.2014. The base sum assured for the aforesaid policy was Rs.5,00,000/- in case of death, the risk cover would be double the sum assured, i.e., Rs.10,00,000/-. The premium was payable at yearly frequency @ Rs.55,733/-. The insured died unexpectedly on 23.11.2014. The Opposite Party No.1 being the registered nominee-cum-legal heir of the DLA raised death claim and submitted all required documents as sought for. The Petitioner insurer, however, repudiated the death claim on 21.05.2015 on the ground that the DLA had suppressed material facts regarding her pre-existing diseases and her annual income.

4. The Opposite Party No.1 being aggrieved by such order of repudiation which has caused harassment and mental agony, there being no pre- existing disease to his knowledge and when the DLA has sufficient mean to pay the sum assured, alleging “deficiency in service”, approached the Permanent Lok Adalat for Public Utility Services, Ganjam at Berhampur in P.L.A. Case No.319 of 2015 claiming the death benefit along with cost and compensation. The application was supported by affidavit. The Opposite Party No.1 had produced photo copy of order of repudiation, copy of proposal premium payment receipt, copy of death certificate copy of bank pass book and copy of voter’s ID card of the DLA.

5. The Permanent Lok Adalat for Public Utility Services, Ganjam at Berhampur taking into account the factual aspect of the case, vide order dated 30.05.2016 passed in P.L.A. Case No.319 of 2015 and held the order of repudiation of claim passed by the Petitioner/ Insurance Company was neither reasonable nor bonafide. Accordingly, the order of repudiation dated 21.05.2015 passed by the Petitioner/ Insurance Company was set aside and the Petitioner/ Insurance Company was directed to pay the death benefit as stated supra.

6. Being aggrieved by the order dated 30.05.2016 passed in P.L.A. Case No.319 of 2015 by the Permanent Lok Adalat for Public Utility Services, Ganjam at Berhampur, the Petitioner/ Insurance Company is constrained to approach this Court by way of this Writ Petition..

II. PETITIONER’S SUBMISSIONS:

7. Learned counsel for the Petitioner earnestly made the following submissions in support of his contentions.

(i) The life assured had suppressed about her actual income, previous ailment i.e. she was s