 "Knowledge of ailment must to establish suppression of facts")
Sometimes a person suffers from a disease but is unaware of its existence until the ailment manifests itself. Or, a disease might have been diagnosed but the patient might not be aware. When a pre-existing ailment is not disclosed in an insurance proposal, it will not automatically amount to suppression of facts unless the insurance company establishes that the insured knew about it.
This landmark ruling was recently given by the National Commission in a judgement dated December 16, delivered by Ajit Bharihoke for the bench, with Suresh Chandra.
Manjeet Singh had taken a postal life insurance on September 1, 2008, for a sum insured of Rs 2 lakh. Singh expired on June 24, 2009. His mother, Jyoti Devi, who was the nominee, lodged a claim. It was rejected on the ground that Singh had concealed the fact that he was suffering from AIDS/HIV when applying for insurance coverage.
His mother filed a complaint before the Jind District Consumer Forum. The postal authorities contested the complaint, and reiterated their stand that the claim was rightly repudiated, as Singh had not disclosed he was HIV-positive while buying the policy.
After considering the evidence and the rival contentions, the District Forum observed Singh was serving in the army, where soldiers regularly undergo medical examination and check-up. So, it must be presumed Singh was not suffering from any fatal disease. More, the insurer was always entitled to ask a person to undergo medical examination before issuing a policy. The Forum held the wrongful rejection of the claim was a deficiency in service. It awarded Devi the sum insured of Rs 2 lakh, along with eight per cent interest from the date of the complaint till its payment.
The postal authorities approached the Haryana State Commission in appeal. The Commission observed the army record showed Singh's medical category to be 'AYE/Shape-1'. According to Rule 14 (4) of the Post Office Insurance Fund Rules, defence personal who are in AYE/Shape-1 category are exempted from the requirement of undergoing a medical examination. Though the claim was rejected alleging suppression of AIDS/HIV, no evidence was produced to substantiate this allegation. In the absence of proof, a rightful claim cannot be rejected on the basis of mere allegations simply because Singh had expired within a few months after insuring himself. The State Commission upheld the Forum's order and dismissed the appeal.
The postal authorities then approached the National Commission. They produced a medical opinion dated July 14, 2008, of the Base Hospital at Delhi Cantonment, which mentioned HIV had been detected while screening Singh for fever. In the proposal form submitted subsequently on September 1, 2008, Singh had declared neither he nor his family members suffered from any hereditary or infectious diseases like insanity, epilepsy, gout, asthma, tuberculosis, cancer, leprosy, diabetes, HIV/AIDS, kidney diseases, paralysis, hypertension, brain disease, or any other serious disease. The postal authorities argued that the medical opinion established that Singh was aware of his HIV-positive status but had suppressed it while applying for insurance. Devi's lawyer countered this by arguing the medical opinion had not been proved by leading the evidence of the doctor concerned.
The National Commission observed that though the argument of the postal authorities seemed attractive, what is necessary to establish misrepresentation or concealment is the fact that the insured was actually aware of his ailment while submitting the proposal, yet had failed to disclose the relevant information. The medical opinion, a confidential record, mentions Singh's HIV status but there was nothing to show whether or not the doctors had communicated this fact to him. The best evidence could be given by the doctor who had made the noting in Singh's medical record, but this evidence was not produced. So, it would have to be inferred that Singh was not aware of his HIV-positive status.
The Commission accordingly held that in the absence of knowledge of the ailment, there could not be any misrepresentation or concealment of facts. Hence, the National Commission upheld the order passed by the District Forum and dismissed the postal department's revision petition.
The writer is a consumer activist
This landmark ruling was recently given by the National Commission in a judgement dated December 16, delivered by Ajit Bharihoke for the bench, with Suresh Chandra.
Manjeet Singh had taken a postal life insurance on September 1, 2008, for a sum insured of Rs 2 lakh. Singh expired on June 24, 2009. His mother, Jyoti Devi, who was the nominee, lodged a claim. It was rejected on the ground that Singh had concealed the fact that he was suffering from AIDS/HIV when applying for insurance coverage.
His mother filed a complaint before the Jind District Consumer Forum. The postal authorities contested the complaint, and reiterated their stand that the claim was rightly repudiated, as Singh had not disclosed he was HIV-positive while buying the policy.
After considering the evidence and the rival contentions, the District Forum observed Singh was serving in the army, where soldiers regularly undergo medical examination and check-up. So, it must be presumed Singh was not suffering from any fatal disease. More, the insurer was always entitled to ask a person to undergo medical examination before issuing a policy. The Forum held the wrongful rejection of the claim was a deficiency in service. It awarded Devi the sum insured of Rs 2 lakh, along with eight per cent interest from the date of the complaint till its payment.
The postal authorities approached the Haryana State Commission in appeal. The Commission observed the army record showed Singh's medical category to be 'AYE/Shape-1'. According to Rule 14 (4) of the Post Office Insurance Fund Rules, defence personal who are in AYE/Shape-1 category are exempted from the requirement of undergoing a medical examination. Though the claim was rejected alleging suppression of AIDS/HIV, no evidence was produced to substantiate this allegation. In the absence of proof, a rightful claim cannot be rejected on the basis of mere allegations simply because Singh had expired within a few months after insuring himself. The State Commission upheld the Forum's order and dismissed the appeal.
The postal authorities then approached the National Commission. They produced a medical opinion dated July 14, 2008, of the Base Hospital at Delhi Cantonment, which mentioned HIV had been detected while screening Singh for fever. In the proposal form submitted subsequently on September 1, 2008, Singh had declared neither he nor his family members suffered from any hereditary or infectious diseases like insanity, epilepsy, gout, asthma, tuberculosis, cancer, leprosy, diabetes, HIV/AIDS, kidney diseases, paralysis, hypertension, brain disease, or any other serious disease. The postal authorities argued that the medical opinion established that Singh was aware of his HIV-positive status but had suppressed it while applying for insurance. Devi's lawyer countered this by arguing the medical opinion had not been proved by leading the evidence of the doctor concerned.
The National Commission observed that though the argument of the postal authorities seemed attractive, what is necessary to establish misrepresentation or concealment is the fact that the insured was actually aware of his ailment while submitting the proposal, yet had failed to disclose the relevant information. The medical opinion, a confidential record, mentions Singh's HIV status but there was nothing to show whether or not the doctors had communicated this fact to him. The best evidence could be given by the doctor who had made the noting in Singh's medical record, but this evidence was not produced. So, it would have to be inferred that Singh was not aware of his HIV-positive status.
The Commission accordingly held that in the absence of knowledge of the ailment, there could not be any misrepresentation or concealment of facts. Hence, the National Commission upheld the order passed by the District Forum and dismissed the postal department's revision petition.
The writer is a consumer activist