Supreme Court of India
GOKAL CHAND (D) THR. LRS.versusAXIS BANK LTD. & ANR.
- Citation
- 2022 INSC 1287
- Decided
- 15 December 2022
- Disposal
- Appeal(s) allowed
- Bench
- K M JOSEPH
Holding
The insurer’s conduct amounted to deficiency of service and, having accepted the premium and fulfilled the medical pre‑condition, a binding insurance contract existed, obligating the insurer to honour the claim.
Summary
The appellants had taken a home loan from Axis Bank, which required a life‑insurance policy on the borrower’s life. The bank paid the premium to Max Life Insurance and the insured underwent a medical test that showed no health issues. The insured died shortly thereafter, and the insurer repudiated the claim, sending an ante‑dated letter postponing the policy and later refunding the premium. The lower consumer commissions held that no contract existed because the policy had not been formally issued. The Supreme Court examined the presumption of acceptance of an insurance contract when the premium is retained and the medical test is passed, and found the insurer’s post‑death actions to be malafide and a clear deficiency of service. Consequently, the Court set aside the lower orders, held that a contract existed, and directed the insurer to honour the claim and pay the due amount.
Issues considered
- Whether the retention of the premium and completion of the medical test constitute acceptance of the insurance contract despite the absence of a formal policy document.
- Whether the insurer’s issuance of an ante‑dated postponement letter after being informed of the insured’s death amounts to deficiency of service and malafide conduct under the Consumer Protection Act.
- Whether the insurer is liable to honour the claim and pay the sum assured to the claimant.
- Whether the bank, as an agent of the insurer, is liable for deficiency of service.
Subjects
consumer protectioninsurance claimdeficiency of servicepresumption of acceptancemalafide conducthome loanlife insurancecontract of insurance
Judgment
[2022] 17 S.C.R. 739 739
GOKAL CHAND (D) THR. LRS. A
v.
AXIS BANK LTD. & ANR.
(Civil Appeal No. 9237 of 2022)
DECEMBER 15, 2022 B
[K. M. JOSEPH AND HRISHIKESH ROY, JJ.]
Consumer Protection – Insurance Policy – Deficiency of
Service – A home loan was secured by the appellants for which
obtaining a life insurance was a pre-requisite – Life insurance in
C
the name of husband of the complainant (the insured, now deceased)
was obtained – As per the appellants, respondent No.1-bank acting
as an agent for respondent no.2-Insurance Company, on 25.07.17
sanctioned the home loan – From the disbursed loan amount,
insurance premium was paid on behalf of the insured by the bank
to the insurance company – The insured was subjected to medical D
tests on 30.07.17 as a pre-condition for securing the home loan –
Died of cardiac arrest on 08.08.17 – Death of the insured was
intimated to the insurance company on 16.08.17 with a request to
process the insurance claim, however the claim was repudiated –
Consumer complaint dismissed by State Commission – Appeal
E
dismissed by National Commission – Held: On 30.07.17, the insured
was called for medical examination and the treadmill test, did not
flag any health issue – In such backdrop, the communication (an
ante-dated letter) of the insurance company for postponing the life
insurance coverage by six months by adverting to the treadmill test
report and that too at a stage after intimation about the death of the F
insured, appears to be a malafide act – Moreover, the insurance
company declining the policy by unilaterally refunding the insurance
premium, suggests that the respondent no.2 was deficient in
rendering services to the appellant – Impugned judgment set aside
– Complaint allowed – Consumer Protection.
G
Consumer Protection – Insurance policy – Presumption of
acceptance of the policy by the insurer – Ratio of decision in Raja
Vasireddy Komalavalli Kamba case as clarified in D. Srinivas case –
Discussed.
H
739
740 SUPREME COURT REPORTS [2022] 17 S.C.R.
A Allowing the appeal, the Court
HELD: 1.1 The reason for deferment is surprisingly shown
as treadmill test finding, although, no abnormality as such was
detected in the said test report. Yet, the insurance company
dispatched an antedated letter (written after getting intimation
B about the death of the insured), informing about 6 months
postponement of the proposal. This would suggest that the
insurance company hurriedly dispatched the ante dated letter,
purporting to postpone the proposal, only after getting information
about the death of Gokal Chand on 16.8.2017. Even in this first
ante-dated communication of the insurance company, there was
C no mention of rejection of the proposal or refund of the insurance
premium (Rs. 6,24,172), remitted by the bank to the insurance
company on 25.7.2017 i.e., the date when the loan amount was
sanctioned. The tracking details of the insurance postponement
communication of the respondent No. 2 sent through the Blue-
D Dart Courier reflects that the insurance company’s letter was
dispatched only at 19:38 hours on 16.8.2017. There was no
mention in this letter, about the refund of the premium. Thereafter
only on 17.8.2017, the premium amount was unilaterally returned
by the respondent No. 2 to the loan account, followed by the
communication dated 31.8.2017 purporting to decline the
E insurance policy for the housing loan, sanctioned by the bank.
[Paras 15-17][747-A-E]
1.2 It was a prerequisite for the home loan borrower to
obtain life insurance coverage and the records show that the loan
amount was sanctioned on 25.7.2017. On that very day, Rs.
F 6,24,172/- was remitted towards insurance premium by the bank
to the insurance company. This would suggest that all the
requirements for the policy as prescribed by insurance company
were satisfied at that stage. On 30.7.2017, the insured was called
for medical examination and the treadmill test, did not flag any
G health issue. In such backdrop, the communication of the
insurance company for postponing the life insurance coverage
by six months by adverting to the treadmill test report and that
too at a stage after intimation about the death of the insured to
the respondents, appears to be a malafide act. Moreover, the
decision by the insurance company declining the policy by
H
GOKAL CHAND (D) THR. LRS. v. AXIS BANK LTD. & ANR. 741
unilaterally refunding the insurance premium in the given A
circumstances, would suggest that the respondent No. 2 were
deficient in rendering services to the appellant. [Paras 18 and
19][747-E-H]
1.3 The respondents, however, contend that there was no
binding life insurance contract between the respondent No. 2 B
and the appellant and Life Insurance Corporation of India vs. Raja
Vasireddy Komalavalli Kamba and Others was cited to argue that
acceptance of an insurance contract may not be completed by
mere retention of the premium or preparation of the policy
document. The acceptance must be signified by some act by which
the law raises a presumption of acceptance. The ratio of above C
decision in LIC vs. Raja Vasireddy Komalavalli Kamba was
considered by this Court in D. Srinivas vs. SBI Life Insurance
Company Limited and Others and it was clarified that while there
is no quarrel with the proposition laid in Raja Vasireddy
Komalavalli Kamba, the former only laid down a flexible formula D
for the court to see as to whether there was a clear indication of
acceptance of insurance. The forums below have blindly relied
on the same, and failed to take into cognizance the later ratio in
D. Srinivas, which stressed on considering the unique facts of the
case to determine whether there is a presumption of acceptance
of the policy by the insurer. [Paras 20 and 21][748-A-D] E
D. Srinivas vs. SBI Life Insurance Company Limited and
Others (2018) 3 SCC 653 : 2018 (3) JT 10 – held
applicable.
Life Insurance Corporation of India vs. Raja Vasireddy F
Komalavalli Kamba and Others (1984) 2 SCC 719 :
[1984] 3 SCR 350 – referred to.
1.4 The conduct of the respondent No. 2 cannot be
countenanced against the good faith standards that an insurance
contract warrants. In this case, the pre-condition for the home G
loan as stipulated by the respondents was that life of the borrower
will have to be insured. Only after assessment of the applicant’s
credentials, the loan was approved. When the loan amount was
sanctioned, the premium amount was kept aside and was credited
H
742 SUPREME COURT REPORTS [2022] 17 S.C.R.
A to the insurance Company and the insured was subjected to a
medical test which showed normal health status. Thus, premium
was accepted and retained for the life insurance and no change of
this position was found necessary even after the treadmill test
result of the insured. This entire procedure would suggest, at
least from the insurer’s perspective, that the insurance process
B
was complete & all mandatory requirements were met.
Significantly, there was no contrary communication by the
respondent No. 2 indicating otherwise as well. Moreover, when
the death information was conveyed to the respondents, most
surprisingly, that was the trigger that led to the insurance company
C to issue a back dated letter deferring the insurance process, which
was followed by refund of the premium a few days later, and then
the repudiation after that. The case at hand shows clear malafide
on the part of respondent No. 2 in the manner they dealt with the
insurance policy, after learning of the death of the insured person
on intimation from the affected persons. The way the issue was
D
addressed by the respondent No. 2 following the information
conveyed does fail, the test of Reasonable Conduct. On top of
that, to cover up their late reaction, most tellingly, the ante dated
letter under the garb of an unfounded medical reason was
dispatched. These amount to a clear case of deficiency of service
E and a non-bonafide conduct by the respondent no.2. The contrary
finding in the impugned order does not pass judicial scrutiny.
The impugned judgment is set aside. The complaint stands
allowed. The respondent No.2 is directed to process the
complainant’s insurance claim and remit the payable sum. [Paras
25-27][750-E-H; 751-A-D]
F
Case Law Reference
[1984] 3 SCR 350 referred to Para 20
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 9237
of 2022.
G
From the Judgment and Order dated 12.09.2019 of the National
Consumer Disputes Redressal Commission, New Delhi in First Appeal
No. 1834 of 2019.
Harshit Khanduja, Ms. Ayushi Chaurasia, Ms. Sujal Gupta, Dr.
Pratyush Nandan, Yash Pal Dhingra, Advs. for the Appellants.
H
GOKAL CHAND (D) THR. LRS. v. AXIS BANK LTD. & ANR. 743
Devendra Kumar Singh, Karunakar Mahalik, Ms. Suman Bagga, A
Ms. Manjeet Chawla, Advs. for the Respondents.
The Judgment of the Court was delivered by
HRISHIKESH ROY, J.
Leave granted. B
2. Heard Mr. Harshit Khanduja, the learned counsel appearing
for the appellants. Also heard Ms. Suman Bagga, learned counsel
representing the Max Life Insurance Corporation (respondent No. 2).
The first respondent is represented by Mr. Devendra Kumar Singh.
3. The appeal arises out of a home loan secured by the appellants C
for which obtaining the life insurance in the name of Gokal Chand (now
deceased) was a pre-requisite, as set out by the Axis Bank (respondent
no.1).
4. The appellants project that respondent No. 1 bank acting as an
agent for respondent No. 2 Insurance Company, on 25.7.2017 sanctioned D
home loan of Rs. 70,99,172/-. From the disbursed loan amount, insurance
premium of Rs. 6,24,172/- was paid on behalf of the insured Gokal Chand
by the bank to the insurance company. The loan account has since been
settled by the borrowers on 19.3.2020 during the pendency of the appeal.
5. Gokal Chand had faced a medical test on 30.7.2017 as a pre- E
condition for securing the home loan and although,he died of cardiac
arrest soon thereafter on 8.8.2017,the respondent No. 2 refused to settle
the loan account when the insurance claim was made. Consequently, a
Consumer Complaint was filed by the appellants before the State
Consumer Disputes Redressal Commission, Haryana (for short “State F
Commission”). The State Commission, however, dismissedthe Consumer
Complaint with the observation that there was no privity of contract
between the insurer and the insured.
6. The resultant appeal was dismissed by the National Consumer
Disputes Redressal Commission (for short “National Commission”) by G
the impugned order which has led to the present appeal before this Court.
7. In the impugned judgment, it was noted that the Complainant
along with her husband, late Gokal Chand approached the bank for a
home loan for which the respondent bank had insisted that a life insurance
cover should be obtained from respondent No. 2 on the life of Gokal
H
744 SUPREME COURT REPORTS [2022] 17 S.C.R.
A Chand.The bank accordingly deducted a sum of Rs.6,24,172/-on
25.7.2017 towards the insurance premium.The insured Gokal Chand was
subjected to medical tests on 30.7.2017 and although he died on 8.8.2017,
the insurance claim was repudiated by respondent No. 2.
Counsel’s Submissions
B 8.1. Mr. Harshit Khanduja, the learned counsel for the appellant
would submit that the death of the insured Gokal Chand was intimated
on 16.8.2017 with a request to process the insurance claim, however,
instead of acting on the information furnished by the appellants, a letter
(purportedly dated 3.8.2017) was served on the appellant with the
C information that the proposal for insurance cover for Gokal Chand is
postponed by six months.The reason disclosed for postponement was
“Treadmill Test Finding.”
8.2. The appellants have set up a specific case of the respondent
no. 2 ante-dating the purported letter indicating postponement of the
D proposal and unilaterally reversing/refunding the insurance premium, much
after the death of the insured was informed to the insurance company.
8.3. According to the appellants, both Forums failed to consider
the fact that the insurance company retained the insurance premium for
some time after the death of the insured on 8.8.2017 and returned the
E same only after the appellant, on 16.8.2017, visited the bank for giving
information about the death of the insured. This was immediately informed
by telephone by the bank to the insurance company and to the insurance
company in the late evening of 16.8.2017 (date of death intimation),posted
an ante-dated letter (bearing the date as 3.8.2017 on it) which was
received by the appellant on 17.8.2017. In the said letter, it was mentioned
F that the proposal has been postponed for six months.On the next date
i.e., on 17.8.2017, the amount debited towards insurance premium was
unilaterally refunded and was adjusted in the loan account.
8.4. The contention here is that when the medical/treadmill test
result of the insured was normal, there was no reason to either postpone
G or to reject the insurance policy when the payable premium was
ascertained and debited by the bank to the insurance company. It is,
therefore, argued that the act of the insurance company was an
afterthoughttriggered only after the intimation of death and a request for
processing claim.Moreover, such an action was unreasonable and this
would amount to malafide action.
H
GOKAL CHAND (D) THR. LRS. v. AXIS BANK LTD. & ANR. 745
[HRISHIKESH ROY, J.]
9.1. Representing the insurance company (respondent No. 2), Ms. A
Suman Bagga, learned counsel on the other hand submits that the proposal
was postponed by six months, and eventually the policy was declined
and the insurance company refunded the premium sum to the bank with
intimation to the appellant and therefore no concluded life insurance
policy existed in this case.
B
9.2. Ms. Bagga, the learned counsel, therefore argues that the
respondent No. 2 is not bound to honor the insurance claim since
notwithstanding the collection of the premium amount the policy was at
the proposal stage only. Moreover, unless acceptance of the proposal
leads to issuance of an insurance policy, there can be no relationship of
insurer and the insured for a valid claim. C
10.1. For the respondent bank, Mr. Devendra Kumar Singh,the
learned counsel while supporting the stand of the insurance company
would submit that they had forwarded the proposal to the insurance
company well before Gokal Chand died, and had already remitted the
payable insurance premium, and therefore the bank cannot be said to be D
deficient in rendering service either to the Complainant or to the insured
(Gokal Chand).
Reasoning & Decision
11. As can be noted, the home loan document issued by the bank E
to the applicant Gokal Chand (Annexure P-1) makes it a condition
precedent to obtain the life insurance cover for getting the home loan.
The relevant clause 4.1(k) reads as under: -
(k) comprehensively insure and keep insured, with the Bank
as a sole beneficiary, (i) the Property for its full market value F
or replacement cost, and (ii) whenever required by the Bank,
the risk of death and injury of the Borrower, and
- shall assign in favour of the Bank and submit to the
Bank the original insurance policy document(s) and
premium/payment receipts;
G
- Shall promptly inform the Bank of any loss or damage
to the Property due to any force majeure or Act of God;
- shall do all acts as may be required to maintain the
Bank’s status of sole beneficiary (under the said
insurances) and receive money thereon; H
746 SUPREME COURT REPORTS [2022] 17 S.C.R.
A 12. The applicant’s declaration in Loan Letter (Annexure P-1)
authorizing bank to disburse premium to the insurance company became
effective only when all the formalities as required by insurance company
were satisfied. The satisfaction of the insurance company’s necessary
requirements was a condition precedent,for disbursal of the premium,
as is clear from the following: -
B
“Opting for the loan amount along with life/property
insurance in the loan downsize letter shall be considered as
the written intent of the customer to avail the insurance. Such
selection shall be considered to be explicit instruction from
the borrower to the bank in writing to disburse the premium
C to the insurance company directly and will become effective
only on the borrower complying with the all formalities as
required by the insurance company...”[Emphasis supplied]
13. While sanctioning the home loan, the respondent bank, debited
the premium amount from the sanctioned loan, and credited the same to
D the account of the insurance company. This appears to be the business
arrangement of the bank and the insurance company. The policy
accordingly was issued by respondent No. 2 in the name of “Axis Bank
Group Credit Life Policy No. 35002367”.
14. The treadmill test undergone by the insured Gokal Chand on
E 30.7.2017, did not bring forth any health issue, as the extract thereof
would show: -
F
G
H
GOKAL CHAND (D) THR. LRS. v. AXIS BANK LTD. & ANR. 747
[HRISHIKESH ROY, J.]
15. The reason for deferment is surprisingly shown as treadmill A
test finding, although, no abnormality as such was detected in the said
test report, as noted earlier. Yet,the insurance company dispatched an
ante-dated letter(written after getting intimation about the death of the
insured), informing about 6 months postponement of the proposal.
16. The above would suggest that the insurance company hurriedly B
dispatched the ante dated letter, purporting to postpone the proposal,
only after getting information about the death of Gokal Chand on
16.8.2017. Interestingly, even in this first ante-dated communication of
the insurance company, there was no mention of rejection of the proposal
or refund of the insurance premium (Rs. 6,24,172), remitted by the bank
to the insurance company on 25.7.2017 i.e., the date when the loan C
amount was sanctioned.
17. The tracking details of the insurance postponement
communication of the respondent No. 2 sent through the Blue-Dart
Courier reflects that the insurance company’s letter was dispatched only
at 19:38 hours on 16.8.2017. Significantly, there was no mention in this D
letter, about the refund of the premium.Thereafter only on 17.8.2017,
the premium amount was unilaterally returned by the respondent No. 2
to the loan account, followed by the communication dated 31.8.2017
purporting to decline the insurance policy for the housing loan, sanctioned
by the bank. E
18. As earlier indicated, firstly, it was a pre-requisite for the home
loan borrower to obtain life insurance coverage and the records show that
the loan amount was sanctioned on 25.7.2017. On that very day, Rs.
6,24,172/- was remitted towards insurance premium by the bank to the
insurance company.This would suggest that all the requirements for the F
policy as prescribed by insurance company were satisfied at that stage.
19. On 30.7.2017, the insured was called for medical examination
and Gokal Chand’s treadmill test,did not flag any health issue. In such
backdrop, the communication of the insurance company for postponing
the life insurance coverage by six months by adverting to the treadmill G
test report and that too at a stage after intimation about the death of the
insuredto the respondents, appears to be a malafide act.Moreover, the
decision by the insurance company declining the policy by unilaterally
refunding the insurance premiumin the given circumstances, would suggest
that the respondent No. 2 were deficient in rendering services to the
appellant. H
748 SUPREME COURT REPORTS [2022] 17 S.C.R.
A 20. The respondents, however, contend that there was no binding
life insurance contract between the respondent No. 2 and the appellant
and the learned counsel cited Life Insurance Corporation of India vs.
Raja Vasireddy Komalavalli Kamba and Others 1 to argue that
acceptance of an insurance contract may not be completed by mere
retention of the premium or preparation of the policy document.The
B
acceptance must be signified by some act by which the law raises a
presumption of acceptance.
21. The ratio of above decision in LIC vs. Raja Vasireddy
Komalavalli Kamba (supra) was considered by this Court in D. Srinivas
vs. SBI Life Insurance Company Limited and Others 2, and it was
C clarified that while there is no quarrel with the proposition laid in Raja
Vasireddy Komalavalli Kamba (supra), the former only laid down a
flexible formula for the court to see as to whether there was a clear
indication of acceptance of insurance. The forums below have blindly
relied on the same, and failed to take into cognizance the later ratio inD.
D Srinivas (supra), which stressed on considering the unique facts of the
case to determine whether there is a presumption of acceptance of the
policy by the insurer.
22. Thelatter was a case where a housing loan was obtained by
the complainant, his wife, and his son as joint borrowers and thereafter,
E Rs. 78,150/- was debited from their account towards life insurance
premium for the home loan borrowers. The son of the complainant who
was covered under the insurance policy died of a heart attack and only
after the death, the insurance company informed that the policy was not
accepted, and this was followed by refund of the premium amount.
23. When the resultant complaint was not entertained by the
F National Commission and this was challenged before this court, Justice
S. Abdul Nazeerwriting for the Court observed, that when medical
examination is compulsory before acceptance of premium, it would be
logical to say that premium acceptance was based on medical
examination, and in a situation where premium is accepted, the pre-
G condition of medical examination stands waived. In such circumstances,
a concluded contract governs the parties and when such claim is
repudiated, the same was held to be a case of deficiency of service in a
concluded insurance contract.
1
(1984) 2 SCC 719.
H 2
(2018) 3 SCC 653.
GOKAL CHAND (D) THR. LRS. v. AXIS BANK LTD. & ANR. 749
[HRISHIKESH ROY, J.]
24. The following relevant passagesfrom D. Srinivas (supra) A
which merit our endorsement in the present factsare extracted below,
for ready reference: -
“10. It is clear from the above that the proposer was willing
to join the life insurance coverage from the respondent
Insurance Company subject to his undertaking medical B
examination and for his willingness he authorised the bank
to debit his account for payment of the premium. This clearly
implies that medical examination was to take place prior to
the premium being debited from the bank account of the
proposer. The specific condition in the policy is that in case
the loan amount exceeds Rs 7.5 lakhs the medical examination C
was compulsory. If the medical examination was compulsory
for such cases it should have been done along with filing of
the proposal form before the payment of the premium. If the
proposal was not accepted for any reason the premium would
have been credited to the account of the proposer. The premium D
has been refunded after 23-2-2011. From this, it is clear that
the Insurance Company had not rejected the proposal before
23-2-2011.
***** ***** ***** *****
12. …The insurance contract being a contract of utmost good E
faith, is a two-way door. The standards of conduct as expected
under the utmost good faith obligation should be met by either
party to such contract.
13. From the aforesaid clause, it may be seen that the
condition precedent for acceptance of the premium was the F
medical examination. It would be logical for an underwriter
to accept the premium based on the medical examination and
not otherwise. Therefore, by the very fact that they accepted
the premium waived the condition precedent of medical
examination. G
14. It is an admitted fact that the premium was paid on 29-9-
2008. That it was only on 18-1-2011 that the respondent
Insurance Company informed the appellant that the policy
was not accepted by them. We are unable to fathom the reason
for such excessive delay in informing the appellant, which
H
750 SUPREME COURT REPORTS [2022] 17 S.C.R.
A cannot be excused. We are of the opinion that the rejection of
the policy must be made in a reasonable time so as to be fair
and in consonance with the good faith standards. In this case,
we cannot hold that such enormous delay was reasonable.
Moreover, it is borne from the records that the premium was
only repaid on 24-2-2011, after a delay of more than one
B
year five months. If we consider above aspects, it can be
reasonably concluded that the insurer is only trying to get
out of the bargain, which they had wilfully accepted. From
the aforesaid circumstances we can easily conclude that the
policy was accepted by the insurer.
C
15. In the circumstances, there is no reason to believe that
there was no complete contract. There is clear presumption
of the acceptance of the proposal in favour of the proposer.
Therefore, the majority view of the Commission would not
sustain.”
D
25. Guided by the above judgment in like circumstances, the latter
ratio is applicable to the facts at hand. Though, we acknowledge that
there is no excessive delay in the current case between medical test &
repudiation unlike in D. Srinivas (supra),where the period was over 2
years, what needs to be focused upon in the interest of justice is the
E trigger & surrounding circumstances which led to the rejection of proposal
by the insurance company.In that light, the conduct of the respondent
No. 2 cannot be countenanced against the good faith standards that an
insurance contract warrants. In this case, the pre-condition for the home
loan as stipulated by the respondents was that life of the borrower will
have to be insured. Only after assessment of the applicant’s credentials,
F
the loan was approved. When the loan amount was sanctioned, the
premium amount was kept aside and was credited to the insurance
Company and the insured was subjected to a medical test which showed
normal health status. Thus, premium was accepted and retained for the
life insurance and no change of this position was found necessary even
G after the treadmill test result of the insured. This entire procedure would
suggest, at least from the insurer’s perspective, that the insurance process
was complete & all mandatory requirements were met. Significantly,there
was no contrary communication by the respondent No. 2 indicating
otherwiseas well. Moreover, when the death information was conveyed
to the respondents, most surprisingly, that was the trigger that led to the
H
GOKAL CHAND (D) THR. LRS. v. AXIS BANK LTD. & ANR. 751
[HRISHIKESH ROY, J.]
insurance company to issue a back dated letter deferring the insurance A
process, which was followed by refund of the premium a few days later,
and then the repudiation after that.
26. The case at hand shows clear malafide on the part of
respondent No. 2 in the manner they dealt with the insurance policy,after
learning of the death ofthe insured person on intimation from the affected B
persons. The way the issue was addressed by the respondent No. 2
following the information conveyed does fail,in our opinion,the test of
Reasonable Conduct. On top of that, to cover up their late reaction,most
tellingly, the ante dated letter under the garb of an unfounded medical
reason was dispatched.These in our opinion, amount to a clear case of
deficiency of service and a non-bonafide conduct by the respondent C
no.2. The contrary finding in the impugned order do not pass our judicial
scrutiny.
27. We are, therefore, persuaded to conclude that the impugned
judgment is unsustainable and the same is set aside. With this order, the
appeal and the complaint stand allowed. The respondent No.2 is D
accordingly directed to process the complainant’s insurance claim and
remit the payable sum. The parties to bear their own costs.
Divya Pandey Appeal allowed.
(Assisted by : Roopanshi Virang, LCRA) E
F
G
H
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