The National Consumer Commission has directed Birla Sun Life Insurance Co. Ltd. to give a Kandivali-based widow ₹5 crore as an insurance claim amount that it had repudiated, citing the wrong date of birth and concealing material information like medical history and past rejection of policies. The commission said that by giving a longer age, the deceased was subject to a higher premium and no prejudice was caused to the insurer and on its basis, the claim could not be repudiated. On concealment of data, it said that the insurance company could not prove its case. The commission also directed nine percent interest per annum on the claim amount to be given from December 13, 2014, which itself comes to over ₹3.60 crore.
The order dated October 11, 2023, was passed by Justice Ram Surat Ram Maurya, presiding member and Bharatkumar Pandya, member of the National Consumer Disputes Redressal Commission. The order was passed on a complaint of Kandivali resident, Dipti Yogesh Parekh against Birla Sun Life Insurance Co. Ltd.
The background of the case
Dipti's husband, the late Yogesh Balwantrai Parekh, had applied for a policy with Birla for a sum assured of ₹5 crore with a term of 20 years. In her complaint, she stated that the policy was issued by a doctor approved by the insurance firm. The doctor conducted medical examinations on her husband and obtained pathological reports on blood sugar fasting, serum cholesterol, biochemical reports, liver function tests, and biochemistry reports, among others, based on which the policy was issued. After examination of the reports, the policy was issued from December 31, 2012, to December 31, 2032.
During the policy period, Yogesh went to Rajkot in April 2014 on a business trip with his son. He suffered chest pain and was taken to a clinic but since the pain increased, he was moved to a hospital where he expired on April 26, 2014. The hospital informed local police who conducted an inquest and sent the body for postmortem. The body was later released and cremated in Mumbai after which Dipti filed a claim in June 2014. The claim was rejected stating that Yogesh had given incorrect details on health and previous insurance policies.
Insurance company's counterarguments
The company stated that Yogesh had not mentioned the fact that his application was rejected by the insurance firm once. It also stated that his date of birth provided was October 14, 1960 as per PAN card and October 14, 1961 as per Sangli Miraj and Kupwad City Corporation. The firm further stated that Yogesh had sought other policies for himself and his family of which some were surrendered due to the requirement of funds. Before the commission, the insurance firm also contended that as per its investigation, the post-mortem report was fabricated and the deceased suffered from diabetes and heart-related diseases before obtaining the policy.
Commission's findings
The commission during the hearing said that while Yogesh's first application of January 2004 was rejected due to adverse medical reports, no such document of rejection letter was presented. It said that the policy in March 2004 was issued based on the medical report of January 2004 because no other test reports were produced. On test reports of different periods showing higher glucose level, commission observed that it was no indicator of diabetes. The commission also said that Birla citing another insurance firm declining a policy on the basis of elevated sugar levels could not be considered because no affidavit of a responsible officer of the firm was filed. On post mortem report being fabricated, the commission observed that it was a fact that Yogesh had died on that day and in the absence of any other document relating to post mortem, it saw no reason to disbelieve the post mortem report and visceral examination report produced by the complainant.
On date of birth, it ruled that since the age was longer and higher premium charged, there was no reason for prejudice against the insurance firm and that repudiation letter was illegal and had to be set aside.
