Insurance: Commission modified the order passed by district forum

The Chhattisgarh state consumer dispute redressal commission (CSCDRC) has modified the order passed by district forum directing LIC to pay Rs 1,40,000 to the nominee of an insured resident of Korba, who died due to hypertension. The commission reduced the amount to Rs 70,000.

In a complaint, the family of the deceased had stated that Hemlal had purchased two life insurance policies of Rs 40,000 and 30,000 from LIC in January 2004. In both the policies, the wife was made the nominee in case of death of the insured. Insured died the same year in September.

The nominee filed for the claim, which the LIC repudiated on grounds that the deceased suppressed the fact that he was suffering from hypertension at the time of purchasing the insurance and thus was not entitled to any compensation.

The family then approached the district consumer forum, which directed the LIC to pay the insured amount to the nominee.

The LIC challenged the decision and the commission, comprising its president justice SC Vyas and member VK Patil, stating that nothing was brought on record by the respondent / complainant to show that she was entitled to double the value of sum assured in case of death of the insured.

The commission further stated that we are satisfied that the payable amount was only the sum assured plus vested bonus and as the insured died in the same year of issuance of the policy, no bonus was payable and the amount payable was only the sum assured of the policy and nothing more.

The commission however did not accept LIC’s second contention that the deceased had not disclosed the fact about him suffering from hypertension. The commission found that no substantial proof had been brought on record by the LIC before the district forum in this regard.

Merely on the basis of recording of blood pressure on some dates in the treatment book it cannot be said that the deceased was suffering from hypertension. Thus, the commission is not satisfied that there was any case of suppression of material fact in the proposal form and the district forum has rightly decided this question against the LIC.

The appeal filed by LIC succeeded in part and they were directed to pay Rs 70,000 to the nominee along with the interest at 6% per annum from the date of filing the complaint till the date of the payment.

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