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Judgment
C.R. Dash, J.—Repudiation of the Insurance claim of the Petitioner by the opposite parties 1 and 2 is the subject matter of this writ petition.
Petitioner''s husband Late Dinesh Kumar Agrawal took an Insurance policy bearing No. 584779543 for a sum assured of Rs. 10,00,000/-with yearly premium of Rs. 6,644/-. The policy was taken on 31.03.2003 and the policy certificate/bond was issued on 15.04.2003 with the date of commencement of the policy with effect from 15.04.2003. In the said policy the present Petitioner was the nominee. The policy holder paid the first premium of Rs. Rs. 6,644/-vide Annexure-3. Immediately after taking the policy on 31.03.2003, the policy holder (Petitioner''s husband) suffered from Kidney problem and got himself treated in the Kalinga Hospital as an Outpatient vide patient card in Annexure-4. On 9.11.2003 owing to some health complications arising out of the Kidney problem, the policy holder was rushed to Kalinga Hospital in the morning. On the same day i.e. 09.11.2003 he expired of Cardiac arrest. After his death, the present Petitioner being the nominee in the policy approached opposite party No. 2 for settlement of the death claim of her husband. The Petitioner complied with all the requirement as insisted by the opposite parties, but the opposite party No. 2 repudiated the claim of the Petitioner vide letter dated 03.11.2005 (Annexure-6). The Petitioner filed a representation before the Zonal Manager, Life Insurance Corporation of India (Opposite party No. 1). The opposite party No. 1 however vide Annexure-7 confirmed the order of Opposite party No. 2.
Opposite parties 1 and 2 have filed a counter affidavit asserting that from the date of commencement of the policy, the duration of the policy was for one year, one month and 24 days and the Petitioner had paid only one premium. Cause of death of the policy holder as has been evident from the treatment particulars is Chronic Renal Failure (''CRF'' in short). The policy holder, however, at the time of submission of the proposal form while answering the questions with regard to his health did not disclose about the fact that he is suffering from C.R.F. and such a conduct on the part of the policy holder amounts to suppression of material facts. It is the further case of opposite parties 1 and 2 that the Insurance contract is based on principles of uberrimafides i.e., utmost good faith and the opposite parties 1 and 2 have, however, prove to the effect that the policy holder died of C.R.F. and he deliberately suppressed material facts with regard to his health at the time of submission of the proposal.
Learned Counsel for the Petitioner with all the vehemence at his command submits that the opposite parties 1 and 2 having accepted the premium after verification of the proposal form being duly certified by their Medical Officer, cannot now repudiate the claim on the ground of suppression of material facts by the policy holder at the time of submission of the proposal. Assuming arguenda, the allegation of opposite parties 1 and 2 to be true the Petitioner being a layman and ignorant about the symptoms of C.R.F. had no knowledge about the onsetting of the disease of C.R.F. at the time of submission of proposal and the policy holder had suppressed nothing. Otherwise the policy holder, as asserted by the learned Counsel for Smt. the Petitioner had no medical ailment at the time of submission of the proposal and he was found suffering from Kidney problem only after taking the policy. The policy holder having acted bona fide or uberrimafide for that matter, it was not proper and lawful on the part of the opposite parties 1 and 2 to repudiate the claim of the Petitioner. Learned Counsel for the opposite parties on the other hand takes us through hosts of documents relating to treatment of the policy holder and submits that Chronic Renal Failure usually occurs over a number of years as the internal structures of the Kidney are slowly damaged; in the earlier stages there may not be symptoms; in fact, progression may be so slow that symptoms do not occur until kidney function less than 1/10th of normal. Taking us through some text down loaded from internet, learned Counsel for the opposite parties tries to make us aware about the symptoms of CRF at early stage and advanced stage. It is further submitted that as the policy holder died of CRF, he must have suffered from the disease since long, he must also have come across the symptoms of the disease since long and he having suppressed such facts, the policy has been rightly repudiated.
Admittedly the policy was taken on 31.03.2003. According to the Petitioner the policy holder was examined as an out patient in Kalinga Hospital, Bhubaneswar on 13.05.2003. Such an assertion by the Petitioner was disputed by the opposite parties 1 and 2 as there is some over-writing relating to date in the Out Patient Ticket (Annexue-4). In view of such objection, vide order dated 5.1.2010 the OPD Register of Kalinga Hospital for the months of March, 2003 and May, 2003 were called for. On verification of the original OPD Register for the months of March, 2003 and May, 2003 it is found that the figure "3" relating to month in Anneuxre-4 was a slip of pen and subsequently it has been corrected to "5" by over-writing "5"on the figure "3". From the Out Patient Register for the month of May, 2003 it is found that the policy holder was examined as an out patient on 13.05.2003. On verification of the Out Patient Register for both the aforesaid months, learned Counsel for the opposite parties 1 and 2 also accepts the position that the policyholder was examined as an out patient vide Anenxure-4 on 13.05.2003 and not on 13.03.2003. Admittedly, the policy holder expired on 09.11.2003. It is also an admitted position that the policy holder having expired within a period of two years from the date of commencement of the policy, he is not protected by the limitation prescribed in Section 45 of the Insurance Act and the Insurance Company u/s 45 of the said Act has a right to repudiate the claim if the policy holder is found to have suppressed the material facts.
In the case of Mithoolal Nayak Vs. Life Insurance Corporation of India, and referred to in P.C. Chacko and Another Vs. Chairman, Life Insurance Corporation of India and Others, Hon''ble Supreme Court has held that there are three conditions for application of second part of Section 45 of the Insurance Act, which are-
(a) the statement must be on a material matter or must suppress facts which it was material to disclose;
(b) the suppression must be fraudulently made by the policy holder; and
(c) the policy holder must have known at the time of making the statement that it was false or that it suppressed facts which it was material to disclose.
With the aforesaid position of law in the background, we propose to find out whether a policy holder is guilty of suppression of material facts. The policy holder in col.11 of the proposal form has answered all the questions in negative and has certified his usual state of health to be good. According to the proposal form the policyholder had no disease relating to his kidney, brain, lungs, heart, stomach, liver etc; he had no hypertension; he was never hospitalized and during the last five years he had not consulted any medical practitioner for any ailment requiring treatment for more than a week.
From the pleadings in the writ petition, it is found that the policy holder suffered from Kidney problem immediately after taking the policy and he was treated as an Outpatient in Kalinga Hospital vide Outpatient Card in Annexure-4. Annexure-4 shows that the policy holder''s disease diagnosed is DM1 3 and C.R.F. In the column of history and progress, it is mentioned "known case of......C.R.F.(ESRD)". In Annexure-5 at Page-20 also on investigation by the Life Insurance Corporation, the hospital authority have supplied information in Form No. 3816 to the effect that the patient was a known case of Kidney disease (ESRD) on maintenance dialysis. It is further mentioned in said form that history of the case was reported by the patient i.e. the policy holder. During investigation by a Medical Officer "known case of........." is appended in the prescription or examination documents, generally if the disease has already been diagnosed or there is any report to that effect. In the present case, the policy holder came to be treated in Kalinga Hospital on 13.05.2003 for the first time as asserted by the Petitioner. CRF/ESRD is not a disease which would have affected the policy holder over night. By the time he went for treatment to Kalinga Hospital, he had knowledge that he is suffering from CRF/ESRD otherwise in the out patient ticket, the treating physician would not have made the endorsement "known case of CRF....." As asserted in the counter affidavit on 05.04.2003 after four days of taking the policy the Petitioner was treated by one Dr. S.K. Agrawal, who has given the certificate vide Annexure-C at the behest of the opposite parties 1 and 2. From Annexure-C it is found that on the said date i.e. 05.04.2003 the policy holder was treated on the basis of his complaint about weakness, frequency of urination, body ache and HTN. From the said certificate vide Annexure-C it is further found that the policy holder was also suffering from hyper tension. From col.4 of Annexure-C it is further found that the policy holder had shown some old prescriptions to Dr. Agrawal. Dr. Agrawal, however, in Annexure-C could not opine about the duration of the treatment of the policy holder prior to his coming to him. From the aforesaid facts on record it cannot however, be held that the policy holder suffered form hypertension within four days of taking of the policy and within two months thereafter he suffered from CRF. The policy holder has also answered column No. 11 of the proposal form in negative by stating that he had no hypertension. As from Annexure-C it is found that the policy holder was under treatment by 05.04 2003 and by that time he had also visited other doctors, before coming to Dr. Agrawal, conclusion is irresistible that he must have knowledge about his disease of hypertension and other ailments like frequent urination etc. on the date of taking of the policy. The Petitioner has however, either suppressed such fact at the time of giving the proposal or with the full knowledge about his disease he answered column No. 11 of the proposal form knowing the answer he has given to be false.
The Hon''ble Supreme Court in the case of P.J. Chacko supra in paragraph-16 has held thus:
The purpose for taking a policy of insurance is not, in our opinion, very material. It may serve the purpose of social security but then the same should not be obtained with a fraudulent act by the insured. Proposal can be repudiated if a fraudulent act is discovered. The proposer must show that his intention was bona fide. It must appear from the face of the record. In a case of this nature it was not necessary for the insurer to establish that the suppression was fraudulently made by the policy holder or that he must have been aware at the time of making the statement that the same was false or that the fact was suppressed which was material to disclose. A deliberate wrong answer which has a great bearing on the contract of insurance, if discovered may lead to the policy being vitiated in law.
Regard being had to the law settled by the Hon''ble Supreme Court as above and our discussion supra, the answer given by the policy holder in column No. 11 of the proposal form regarding his suffering from High Blood Pressure or kidney disease or regarding his state of health on the face of records are held to be deliberate wrong answers, which has a great bearing on the contract of insurance. We, therefore, find no justification to interfere with the impugned orders vide Annexure-6 and 7. In the result, the writ petition is dismissed.