Page 30 - Life Insurance Today December 2017

of pre-proposal illhealth. Documents perused and parties and after careful consideration of the facts of the case, I
heard. The complainant accepted that his wife had am of the view that LIC has no valid ground for repudiating
undergone hospitalisation and surgery prior to proposing the claim of the complainant. The reason for repudiation
for insurance, but contended that the same was within the given in LIC's letter of repudiation dated 31.03.2004
knowledge of the Agent who only filled up the proposal addressed to the complainant is that in the proposal for
form. The hospital records evidenced that the life assured insurance which formed the basis for the Jeevan Rekha
had history of Dyspnoea for several years, was diagnosed policy taken by the life assured in March,2003, Policy
as a case of Rheumatic Heart Disease and surgery No.182405098, from which the present dispute has arisen,
performed in 1997, 5 years prior to proposing for he had not disclosed details of the policies taken by him
insurance. The material information was not disclosed in earlier.
the proposal in the absence of which the Insurer could not
assess the risk properly. Material suppression was proved In my view, there is no substance in the ground taken by
on the basis of irrefutable evidence on record and the LIC in the said letter of repudiation. The proposer is not
repudiation decision of the Insurer was upheld. Reliance obliged to disclose information which is already in the
was placed on the decision of National Commission in LIC knowledge of LIC. LIC should know what policies the life
of India vs Gowri & Ors in F.A.No. 1993 NC that Agent assured had taken earlier.
while filling up the proposal from acts the Agent of the
insured and not of the Insurer. Evidently, LIC has no information system by means of
which this information can be readily retrieved. However,
The Complaint dismissed. this is no excuse for LIC abdicating its own responsibility
in the matter. What LIC is saying, in effect is this; "We have
Delhi Ombudsman Centre the information about your earlier policies.

Case No. LI - JD / 57 However, we cannot get this information quickly. We have
Smt. Annapurna neither the time nor the inclination to gather this
information. We shall, therefore, hold you responsible for
Vs any omission". This is not a responsible attitude on the
Life Insurance Corporation of India part of LIC.

It is the duty of every prudent insurer to verify all the
Facts of the case : Smt. Annapurna filed a complaint before
information given by the proposer in the proposal form,
this Forum. Her complant was against LIC of India,
Divisional Office, Jodhpur. Her husband late Shri Hemant even if the means of verification are difficult. Information
relating to earlier policies taken is certainly very important,
Kumar Trivedi has taken a policy No.182405098 for sum
specially for determining the risk that LIC is assuming. LIC
assured of Rs. 2,00,000 on 28.03.2003.
certainly cannot rely on the principle of utmost good faith
Before taking this policy, he was also having another policy in this case. It should verify the information. If the means
of verification are difficult then LIC should obtain a
No. 101157837 for Rs. 3,00,000 taken on 28.12.2001
which was in lapsed condition on 28.03.2003. He has not separate affidavit in this matter from the proposer.
mentioned the above policy in the proposal form while
taking the Policy No. 182405098. The life Insurance Now that the worst has happened to the life assured, LIC
is merely ,trying to evade its liability by finding fault with
corporation of India repudiated the claim on the grounds
of nondisclosure of this fact. Hence, this complaint to this the proposal form. This is not acceptable. In the result,
forum. therefore, Honourable Insurance Ombudsman passed the
Award that Life Insurance Corporation of India shall pay
Observations & Decision : After hearing both the parties to Smt. Annapurna, the mother of the life assured and the

“In order to succeed, your desire for success should be greater than your fear of failure.”

30 December 2017 Life Insurance Today

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