LIFE INSURANCE CORPORATION OF INDIA LTD Vs. KANTABEN

JUDGEMENT

(1.) FIRST Appeal No. 145 of 1993 by Life Insurance Corporation of India (for short called L.I.C.) and First Appeal No. 232 of 1993 by Smt. Kantaben, the complainant is directed against the order dated 16.2.93 passed by the State Commission, Gujarat at Ahmedabad, directing the L.I.C. to refund the premium to the complainant after holding that the policy is void.

(2.) THE complainant is the widow of deceased Shri Ramabhai Patel who had during his life time taken a policy of insurance for Rs. 1 lakh vide proposal No. 9517877 dated 9 9.89. Shri Patil died on 22nd December, 1989 after a period of three months of the taking of the policy. The complainant being a nominee in the policy, lodged a claim with the L.I.C. which made inquiries and investigations. By letter dated 18.6.90, the L.I.C. repudiated all liabilities under the policy on account of the deceased having withheld correct information regarding his health at the time of effecting the assurance. The basis of repudiation is the proposal for assurance dated 9.9.89 wherein the deceased had given false answers with the intention of concealment of material facts relating to his health and obtaining the policy by nondisclosure of the fact that he was suffering from cancer and had been taking treatment.

(3.) WE have re -examined the material on record. The contracts of insurance are of utmost good faith. The proposer for Life Insurance is under an obligation to disclose all material facts within his knowledge relating to the state of his health at the time of making the proposal. The averments made as to the State of health of the insured in the proposal form and the personal statements therein are the basis of the contract between the parties. The terms of the policy make it abundantly clear that L.I.C. has acted upon it by entering into the contract of insurance with the deceased. The insured had not disclosed his previous ailments in his proposal dated 9.9.89 and, in fact, he had fraudulently suppressed ihat he was suffering from cancer. The certificate dated 14.5.90 of Dr. Mukund Patel, letter of Dr. Vijay C. Thakar dated 8.5.90 and the Histology Report dated 12.8.89 which are part of the record reveal the state of health of the insured and the treatment for cancer and ultimately reference on 26.8.89 by Dr. D. Patel to Ahmadebad for 'chemo -therapy' etc. It is manifest that the deceased intentionally concealed the facts that he was suffering from cancer and that he was taking treatment therefor. The contract of insurance was entered into as a result of fraudulent suppression of material facts by the insured and thus the policy is vitiated. Therefore, no claim is admissible under a policy which is vitiated.