Case: Life Insurance Corporation of India vs. Dr. Nilam Hetalkumar Patel & 4 Ors.
Case No.: RP/1096/2019
Summary
The Life Insurance Corporation of India (LIC) faced a decision from the Gujarat State Consumer Disputes Redressal Commission (State Commission) that denied its appeal against a ruling by the National Consumer Disputes Redressal Commission (NCDRC). The NCDRC directed LIC to reimburse the complainant’s nominees for Rs 47.90 lakh after the complainant’s nominee denied the claims on the grounds that the complainant had withheld material information at the time of policy issuance. The Patel family had filed claims for the policies after Mr. Patel died of a heart attack. The District Commission partially decided in favor of the nominees, but LIC challenged the ruling in front of the Gujarat State Consumer Disputes Redressal Commission. The NCDRC, in agreement with the State Commission, confirmed the decision, stating that an affidavit from the physician is not required when the insured party has given the insurance company permission to obtain medical records from hospitals.
About the case
The appeal filed by the Life Insurance Corporation of India (LIC) against a Gujarat State Consumer Disputes Redressal Commission ruling was denied by the bench of the National Consumer Disputes Redressal Commission (NCDRC), which is led by Inder Jit Singh, the Presiding Member. The NCDRC directed LIC to reimburse the complainant’s nominees for Rs 47.90 lakh after the complainant’s nominee denied the claims on the grounds that the complainant had withheld material information at the time of policy issuance.
The Life Insurance Company (LIC) provided nine life insurance policies to Anil Kumar Patel, a native of Kheda, Gujarat. Unfortunately, Mr. Patel died of a heart attack just two years after obtaining these policies. After Mr. Patel passed away, his heirs, who were entitled to insurance proceeds, properly submitted claims for each of the previously stated life insurance policies. But since Mr. Patel had omitted important information from the policy’s issuance, LIC denied the claims. After that, the Patel family went to the Kheda District Consumer Disputes Redressal Forum (also known as the “District Commission”) to fight for their rights, and the District Commission partially decided in favor of the nominees.
Feeling let down by this result, LIC took legal action and challenged the ruling in front of the Gujarat State Consumer Disputes Redressal Commission (the “State Commission”). However, their appeal was turned down. The National Consumer Disputes Redressal Commission (“NCDRC”) received an appeal from LIC as a final option. The complainants in this instance, Mr. Patel’s nominees, argued that the medical certificate regarding Mr. Patel’s depression was not to be taken into consideration as proof. They made this claim because the certificate did not have the required affirmation from the physician who had provided it. The candidates also claimed that Mr. Patel had undergone medical exams by LIC’s panel physicians prior to the policies being issued, and they mentioned that Mr. Patel’s obesity had resulted in an additional premium being charged. This, they claimed, proved there had been no hiding or repression of important information. LIC argued, however, that Mr. Patel had in fact withheld important information about his medical background and course of treatment. According to LIC, the insurance claims were repudiated because of this non-disclosure. They maintained that, in light of Mr. Patel’s failure to disclose pertinent facts, the allegations might legitimately be retracted.
In the State Commission hearings, Mr. Patel’s nominees contended that a medical certificate regarding his depression was not to be taken into consideration as evidence since the physician who gave it did not provide an affidavit. However, the certificate was admitted into evidence by the State Commission. This decision was confirmed by the NCDRC in agreement with the State Commission. The Supreme Court’s ruling in Satwant Kaur Sandhu vs. The New India Assurance Co. Ltd (2009) 8 SCC 316, which stressed that an affidavit from the physician is not required when the insured party has given the insurance company permission to obtain medical records from hospitals, was cited by the NCDRC. As a result, the NCDRC determined that the certificate ought to be accepted. For this reason, the NCDRC denied the LIC’s appeal and mandated that it pay the nominees of Mr. Patel a total of Rs. 47.90 lakh.
