Punjab man dies in accident avoiding dog, court orders 4 insurance firms to pay Rs 1.75 crore to sons

“The Deceased Life Assured (DLA) suffered multiple external and internal injuries, including a ‘frontal bone fracture’ during the accident, which is covered under external and violent means…The frontal bone fracture in the skull is sufficient in the ordinary course of nature to cause death,” the commission said on June 10, rejecting the insurers’ argument that the farmer had died due to heart and lung ailments.

NCDRC presiding member AVM J Rajendra (Retd) and member Justice Anoop Kumar Mendiratta pronounced the order on June 10.

No infirmity in state commission’s order

• The death of DLA on account of injuries sustained in the accident cannot be suspected, the consumer panel observed.
• The post-mortem report duly noted the cause of death as cardio-respiratory arrest, which in all probability was on account of head injuries or accelerated by the accident and is the immediate cause of death.
• The rejection of respective claims by the insurance companies claiming that the deceased had wrongly answered regarding his health condition in the proposal form is not supported by any evidence, and, as such, the rejection of the claims is unjustified.

• A mere averment in this regard cannot be accepted to assume that the deceased was aware of any of the aforesaid health issues before obtaining the policy.
• Until and unless insurance companies prove that the deceased furnished incorrect information before obtaining the concerned insurance policies, or suppressed the same in the relevant column of the proposal form, an adverse inference cannot be drawn against the policyholder.
• The national consumer forum did not find any infirmity in the findings of the state commission.

Road accident, insurance dispute

The dispute traces its roots to August 9, 2017, when one Nirmal Singh, a resident of Sahibana village in Ludhiana district, Punjab, was travelling on a scooter with his son Harjinder Singh.

According to the family, a dog suddenly crossed the road, causing the scooter to lose balance and fall. Nirmal suffered serious head injuries and was rushed to Fortis Hospital in Ludhiana, where he was declared dead.

The police initiated proceedings under Section 174 (legal procedure for police to investigate and report on unnatural or suspicious deaths) of the Code of Criminal Procedure. A post-mortem examination was later conducted at Civil Hospital, Ludhiana.

4 insurance firms rejected claims

• Nirmal had purchased four personal accident insurance policies from different insurer companies.
• The policies included a Rs 1 crore cover from Star Health and Allied Insurance Company, Rs 30 lakh from Bharti AXA General Insurance Company, Rs 25 lakh from ICICI Lombard General Insurance Company and Rs 20 lakh from Reliance General Insurance Company, taking the total insured amount to Rs 1.75 crore.
• The insurers refused to honour the claims and questioned the family’s account of the accident.
• Reliance General Insurance stated that there was only a “self-serving testimony” regarding the accident and claimed its investigation suggested that Nirmal Singh was already unwell and had died due to natural causes.
• Star Health made similar allegations, describing the claim as fabricated and asserting that the deceased had died because of existing illnesses rather than an accident.
• Bharti AXA and ICICI Lombard also relied on the post-mortem report, arguing that references to septicaemia, heart disease and lung disease indicated that death had occurred because of medical conditions and not because of accidental injuries.
• The companies further alleged that Nirmal had failed to disclose material health information while obtaining the insurance policies and pointed to the fact that he had purchased multiple accident insurance covers within a short span before his death.

Family fought back citing records

Harjinder Singh and his brother Hardeep Singh challenged the repudiation of the claims before consumer forums. The family relied on the post-mortem report, police DDR (daily diary report), village certificates and affidavits from residents to establish that Nirmal Singh had died in a genuine road accident.

They maintained that the insurers had no evidence showing that he had been diagnosed with serious heart or lung diseases before purchasing the policies.

The Punjab State Consumer Disputes Redressal Commission accepted their case and directed the insurers to pay the claims. The insurance companies subsequently approached the NCDRC.

Turning point: Post-mortem findings

• A key issue before the NCDRC was whether the death resulted from injuries sustained in the accident or from pre-existing illnesses.
• The post-mortem report recorded a lacerated wound near the left eye, bruises on the arm and swelling on the forehead.
• More significantly, doctors found a haematoma and a fracture of the left frontal bone of the skull.
• The report concluded that the cause of death was “cardio-respiratory arrest, septicaemia, lung and heart disease due to head injury” and stated that the injuries were sufficient to cause death in the ordinary course of nature.
• The commission noted that these injuries were consistent with an accident caused by external and violent means and directly linked the fatal outcome to the head injury suffered by Nirmal Singh.

Expert opinions produced by insurers rejected

The insurers sought to rely on opinions from experts who claimed that the head injury was only an incidental finding and that the real cause of death was septicaemia arising from prolonged heart and lung disease. However, the commission refused to accept those opinions.

It observed that the experts had never examined Nirmal and had merely reviewed the post-mortem report after the event. In contrast, the doctor who conducted the post-mortem had physically examined the body and specifically linked the death to the head injury and skull fracture.

The commission said the insurers had failed to produce any convincing material to discredit the post-mortem findings or establish that the accident was fabricated.

‘No proof of concealment of illness’

• The commission also rejected the insurers’ argument that Nirmal Singh had concealed material medical information while purchasing the policies.
• While acknowledging that the post-mortem report mentioned septicaemia and heart and lung disease, the bench pointed out that the insurers had failed to produce any treatment records, prescriptions or medical documents showing that Nirmal knew about these conditions before taking the insurance policies.
• The NCDRC held that mere suspicion could not substitute evidence and that the burden of proving suppression of material facts rested on the insurance companies.
• In the absence of such proof, repudiation of the claims was unjustified.

Multiple policies no ground to deny claims

• Another argument raised by the insurers was that Nirmal had obtained several personal accident policies worth Rs 1.75 crore despite his modest financial profile.
• The commission rejected this contention as well.
• It observed that there is no legal prohibition on obtaining multiple accident insurance policies and that the insurers themselves had issued the policies after assessing the risk and accepting the premiums.
• The bench further noted that the suppression of other policies was not even cited as a ground in the companies’ repudiation letters.

Appeals dismissed, family to receive full insurance cover

After examining the evidence, the commission concluded that Nirmal’s death resulted from injuries suffered in the road accident and that the insurers had failed to establish either fraud or concealment of material facts.

The NCDRC accordingly dismissed the appeals filed by Reliance General Insurance, Bharti AXA and ICICI Lombard and upheld the orders directing payment of their respective policy amounts.

It also allowed the complaint against Star Health and Allied Insurance Company and directed the insurer to pay Rs 1 crore with interest at 7 per cent per annum from the date of repudiation until actual payment. If the amount is not paid within six weeks, the balance amount will carry interest at 8 per cent per annum from the date of default.

With the ruling, the family stands to receive the entire Rs 1.75 crore insurance cover, along with years of accrued interest, bringing an end to a legal battle that began shortly after a fatal accident on a Punjab road in August 2017.