Repudiation of insurance claim based on alleged misrepresentation of age requires substantive evidence; mere speculative assertions are insufficient.

JUDGMENT

1. First Appeal No. 487 of 2018 is filed by Mr. Govind Ram and Smt. Laadu, the Complainants, and FA No. 519 of 2018 is filed by HDFC Standard Life Insurance Co. Ltd. Both these cross Appeals challenge the Rajasthan State Consumer Dispute Redressal Commission, Jaipur (‘State Commission’) order dated 22.02.2018 in CC No. 27/2016, which partly allowed the complaint.

2. Since the facts and questions of law involved in both Appeals are similar, these Appeals are being disposed of by this common Order. For convenience, FA No. 487 of 2018 is being considered as the lead case, and the facts outlined below are derived from CC No.27/2016.

3. Brief facts of the case, as per the Complainants, are that a complaint under Section 17 of the Consumer Protection Act, 1986 was filed before the State Commission against the Opposite Party - HDFC Standard Life Insurance Co. Ltd, engaged in the business of life insurance, on the grounds that Late Shri Ramkaran Jat S/o Shri Hardev Ji Jat, the father of Complainant No.1 and husband of Complainant No.2, had duly completed all requisite formalities and submitted necessary documents including ration card, PAN card etc. to the OP. Thereafter, upon payment of premium dated 30.01.2015, the OP had issued Life Insurance Policy No. 17348816 for a sum assured of Rs.25,00,000 for the period from 30.01.2015 to 30.01.2037. During the subsistence of the policy, the insured unfortunately expired on 24.06.2015, Whereupon the complainants duly lodged a claim on 23.07.2015 along with the original policy and requisite documents. The OP, however, arbitrarily and illegally repudiated the claim vide letter dated 30.01.2016 on untenable and frivolous grounds, despite having accepted the proposal and premium after due verification. Despite legal notice dated 09.02.2016 to the OP and its Review Committee, the claim amount has not been paid. Alleging deficiency in service and unfair trade practice resulting in severe mental agony and financial hardship to the complainants. The complainants sought payment of the assured sum of Rs.25,00,000, along with interest @ 12% per annum, compensation of Rs.5,00,000 for mental agony, Rs.50,000 towards litigation expenses.

4. In their written version, the OP contended that the complaint is liable to be dismissed for being misconceived, vexatious and not maintainable in law. The complaint suffers from misjoinder of parties as only the nominee, namely Mr. Govind Ram Jat, was entitled to receive the policy proceeds under Policy No. 17348816, whereas Smt. Ladu has been wrongly impleaded as Complainant No.2. The Deceased Life Assured (DLA), Late Shri Ram Karan Jat, obtained the policy dated 08.01.2015 for sum assured of Rs.25,00,000 by fraudulently suppressing and misrepresenting material facts relating to his age, health, income and educational qualifications, declaring his date of birth as 12.12.1964 (age 50 years) on the basis of a PAN card. Whereas, investigation and the Voters List of Village Pratappura, Tehsil Hurda, District Bhilwara, revealed his actual age to be approximately 66–67 years at the time of proposal. Such gross underrepresentation of age was material to the assessment and acceptance of risk, particularly in a case of early death, within six months of policy commencement. Insurance being a contract of utmost good faith (uberrima fides), any suppression or misstatement of material facts renders the contract void ab initio. In view of the violation of Section 45 of the Insurance Act, 1938 and the specific terms and conditions of the policy, the claim was bona-fidely repudiated vide letter dated 30.01.2016 after due investigation and application of mind. The OP denied the allegat