JUDGMENT

Yusrin Faidz Yusoff JC:

Introduction

[1] This appeal arises from a claim under a Mortgage Reducing Term Takaful policy (MRTT Plan") following a road accident. The plaintiff, whose left leg was amputated above the knee, sought total and permanent disability ("TPD") benefits under the policy issued by the insurer in conjunction with a housing loan. The insurer rejected the claim, asserting that the plaintiff did not meet the policy's definition of TPD, as he was still capable of performing other forms of work. The Sessions Court found in favour of the plaintiff, awarding him the full policy sum. The insurer now appeals that decision, raising key questions about the interpretation of the TPD clause and the scope of disability coverage under the MRTT Plan.

Background Facts

[2] Abdul Rashid Bin Akhbar Ali (respondent / "plaintiff) entered into a financing arrangement with OCBC Al-Amin Bank Berhad ("D2") for the purchase of a service apartment known as G-10, Block E, Persisiran Titiwangsa Utama, 81200 Taman Tampoi Indah, Johor Bahru, Johor for D'2 purchase price of RM205,708.00 inclusive of MRTT contribution, legal fees, stamp duty and valuation fees.

[3] The contribution towards the MRTT Plan in the sum of RM6,308.00 was disbursed by D2 as 'Participant' under the MRTT Plan to Great Eastern Takaful Berhad ("D1"). The purpose of the MRTT Plan was to provide coverage for the outstanding mortgage amount in the event of the plaintiff's ('Person Covered') TPD or death, with any payout to be made directly to D2 to reduce the outstanding loan balance. The MRTT Plan bearing Certificate No 4002512568 (read together with Master Certificate No OCBC2) took effect from 20 May 2015 to cover the financing tenure of 25 years.

[4] On 5 April 2017, the plaintiff was involved in a motor vehicle accident and was subsequently admitted to hospital, where complications arising from a vascular injury led to the amputation of his left leg above the knee on 25 April 2017. In seeking financial security following this unfortunate event, the plaintiff submitted a claim for TPD benefits to D1 on 26 July 2017, invoking the coverage provided under the MRTT Plan.

[5] D1 rejected the plaintiff's first claim on 1 August 2017 on the ground that the medical evidence submitted was insufficient to satisfy the TPD definition under the MRTT Plan. Specifically, D1 contended that the plaintiff had not demonstrated an inability to engage in any gainful employment as required under the policy. Further, the claim is premature as alleged TPD that the plaintiff claimed to have suffered from was not certified by a medical practitioner for at least 6 consecutive months from the date of disability (pp 395-396 of Appeal Records, Part C Vol. 2).

[6] The plaintiff then submitted a second TPD claim on 15 January 2018, which was again rejected, (pp 397 to 411 of Appeal Records, Part C Vol 2).

[7] Following the rejection of his TPD claim, the plaintiff lodged a Complaint Form dated 13 July 2018 with Bank Negara Malaysia, (pp 204-205 Appeal Records Part C Vol 1). D1 issued a letter to the plaintiff on 16 July 2018, acknowledging receipt of his complaint and stating that it would investigate the matter. After reviewing the plaintiff's complaint, D1 decided to reject the plaintiff's appeal on the ground that his disability did not fall within the TPD definition under the MRTT Plan, (pp 412-415 Appeal Records Part C Vol 2).

[8] A third TPD claim was submitted by the plaintiff on 6 August 2019, along with additional medical documentation. D1 once more rejected the claim, maintaining that the plaintiff did not fulfill the TPD criteria as defined in the MRTT Plan, (pp 416, 431, & 442-443 of Appeal Records Part C Vol 2).

[9] The plaintiff subsequently referred his complaint to the Ombudsman for Financial Services ("OFS"), which, on 26 February 2020, upheld DTs decision and affirmed that the plaintiffs disability did not satisfy the contractual definition of TPD. (pp 444, and 445-512 of Appeal Reco