LIFE INSURANCE CORPORATION OF INDIA Vs. REKHA PARDASANI

JUDGEMENT

(1.) HUSBAND of the respondent complainant took an Endowment Insurance with Profit Policy from the appellants. The proposal form was signed and sent to the appellants on 8.8.2007 and the policy of Rs.85,000 was issued on 20.8.2007 w.e.f. 9.8.2007. The husband of the complainant died on 7.9.09. However, the claim was rejected by the appellants on 28.3.2010 on the ground of suppression of facts in regard to earlier disease of Diabities and Vertigo. The District Forum, Ajmer vide impugned order dated 7.7.2011 while allowing the claim directed the appellants to pay the complainant the insured amount of Rs.85,000 with interest along with Rs.1,500 as expenses.

(2.) AFTER hearing the Counsel for the appellant, we have carefully gone through the material on record.

(3.) ON behalf of the appellants only an affidavit of officer in -charge from the legal cell has been filed who did not have any personal knowledge of the facts. As a matter of fact the affidavit of the agent who sent the proposal form after getting it signed from the insured, the affidavit of the investigator as also any person who could have proved the documents in regard to previous diseases of the insured have not been filed so far. The Insurance Company is suppose to verify all the facts mentioned in the proposal form before issuing the policy. Even otherwise with the fast growing business competition among the Insurance Companies unhealthy practices develop to get maximum benefits and profits. It is not a case of a businessman, trader or an educated employed person but that of a common poor man. He puts in hard earned small savings in such schemes with a hope and aspiration that in case of accident or death he or his family shall get some immediate financial assistance but in most of the cases he is left cheated when his claim is rejected, with just a stroke of pen that he concealed some material facts at the time of signing proposal form or the claim was not properly submitted before the Insurance Company. That apart the agent of the company is required to explain all the details and conditions of the insurance policy sought by the customer. A common man is not supposed to know all the niceties and technicalities of law. Once accepting the premium and having entered into an agreement without verifying the facts, the Insurance Company cannot wriggle out of the liability merely by saying that the contract was made by misrepresentation and concealment. The insurance policies should not be issued and repudiate in such a casual mechanical manner. The policy entails the liability on both sides. It is rather exploitation of the customer and more or less fraud on the public. Such practice should be strongly deprecated.