9911796707
TMI Blog2009 (7) TMI 1375X X X X Extracts X X X X X X X X Extracts X X X X ..... icy provided by the respondent. The policy was for a period from 7th May, 1990 to 6th May, 1991. The annual premium of ₹ 1500/- was also paid by him. On 11th September, 1990, Pritpal Singh suddenly fell ill and was admitted in Dayanand Medical College and Hospital, Ludhiana. On 7th December, 1990 he was shifted to Madras Institute of Nephrology also known as, Vijaya Health Centre, Chennai where his condition deteriorated, ultimately leading to his death on 26th December, 1990. The appellant informed the respondent about the death of her husband on 17th January, 1991. On 29th April, 1991 she filed a claim for ₹ 23,217.80 for reimbursement of the expenses incurred on hospitalization. 3. The respondent - Insurance Company made inquiries from Madras Institute of Nephrology (Vijaya Health Centre) and obtained a certificate dated 6th May, 1992, (Annex.P-6) stating that the deceased was a known case of "Chronic Renal Failure/Diabetic Nephropathy"; was on regular haemodialysis at his place and after admission on 7th December, 1990 with severe breathlessness developed sudden cardiac arrest on 26th December, 1990 leading to his death. The certificate also stated that t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as inordinate delay in deciding the claim under the policy. The District Forum accordingly directed the respondent to pay the claimed amount with interest at 12% per annum from 1st April, 1991 i.e., 3 months after the death of the insured till the date of actual payment. The respondent was also required to pay ₹ 1000/- as cost of litigation. 6. Aggrieved, the respondent - Insurance Company preferred appeal before the State Commission. The State Commission vide its order dated 31st December, 1998, allowed the appeal and set aside the order of the District Forum. The relevant part of the order reads as under: Death of the insured occurred within seven months of taking the mediclaim policy and Section 45 of the Insurance Act is not even remotely attracted. We are of the considered view that repudiation of the claim was on a consideration of the aforesaid record of the Madras Institute of Nephrology and, therefore answer to col. 10 of the proposal form amounted to mis-representation and suppression of material facts regarding health made by the policy holder. No case of deficiency in service has been established. 7. Being aggrieved by the order of the State Commission, the ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ability under this insurance. It was, thus, asserted that the insured having suppressed the fact that he was suffering from Diabetic Nephropathy/Chronic Renal Failure, which fact was within his knowledge, the respondent was justified in repudiating the claim. 10. The core question for consideration is whether the fact that at the time of taking out the mediclaim policy, the policy holder was suffering from chronic Diabetes and Renal failure was a material fact and, therefore, on account of non-disclosure of this fact in the proposal form, the respondent - Insurance Company was justified in law in repudiating the claim of the appellant? 11. Having bestowed our anxious consideration to the matter, we are of the opinion that in the light of the material on record, answer to the question posed has to be in the affirmative. 12. There is no dispute that Section 45 of the Insurance Act, 1938 (for short "the Act"), which places restrictions on the right of the insurer to call in question a life insurance policy on the ground of mis-statement after a particular period, has no application on facts at hand, inasmuch as the said provision applies only in a case of life insurance p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ial facts upon which the contingent chance is to be computed lie most commonly in the knowledge of the assured only; the underwriter trusts to his representation, and proceeds upon confidence that he does not keep back any circumstance in his knowledge to mislead the underwriter into a belief that the circumstance does not exist. The keeping back such circumstance is a fraud, and therefore the policy is void. Although the suppression should happen through mistake, without any fraudulent intention, yet still the underwriter is deceived and the policy is void; because the risqui run is really different from the risqui understood and intended to be run at the time of the agreement... The policy would be equally void against the underwriter if he concealed...Good faith forbids either party, by concealing what he privately knows, to draw the other into a bargain from his ignorance of the fact, and his believing the contrary. 16. Having said so, as noted above, the next question for consideration would be as to whether factum of the said illness was a "material" fact for the purpose of a mediclaim policy and its non-disclosure was tantamount to suppression of material facts en ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... while answering questions in the proposal form. Needless to emphasise that any inaccurate answer will entitle the insurer to repudiate his liability because there is clear presumption that any information sought for in the proposal form is material for the purpose of entering into a Contract of Insurance. 21. Bearing in mind the aforestated legal position, we may advert to the facts in hand. As noted earlier, the proposal form contained the following two questions: 22. Answers given by the proposer to the two questions were "Sound Health" and "Nil" respectively. It would be beyond anybody's comprehension that the insured was not aware of the state of his health and the fact that he was suffering from Diabetes as also chronic Renal failure, more so when he was stated to be on regular haemodialysis. There can hardly be any scope for doubt that the information required in the afore- extracted questions was on material facts and answers given to those questions were definitely factors which would have influenced and guided the respondent - Insurance Company to enter into the Contract of Mediclaim Insurance with the insured. It is also pertinent to note that in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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