THE SUPREME COURT OF INDIA

Gokal Chand (D) VS Axis Bank Ltd. & Anr

CASE NO:- Civil Appeal No. 9237 of 2022, [Arising out of SLP (C) No. 14140 of 2020]

DATE OF DECISION:- 15-12-2022

K.M. Joseph, Hrishikesh Roy JJ

HEADNOTE

INSURANCE / CONSUMER PROTECTION

_*Deficiency in service – Insurance contract – Home Loan sanctioned by Bank to Insured and his wife (appellant) on the pre-condition of obtaining a life insurance policy – Accordingly Bank, from the disbursed loan amount, paid insurance premium on behalf of the insured – Subsequently, Insured underwent a medical test /treadmill test on 30.7.2017, the result of which was normal – But, soon he died of cardiac arrest on 8.8.2017 – Respondent no.2-Insurance company was informed of the death on 16.8.2017 – On the very next day i.e. 17.8.2017, appellant (wife of insured) received a letter dt. 3.8.2017 sent by Insurance company, informing about postponement of proposal for insurance cover by six months due to “Treadmill Test Finding” – On 17.8.2017, insurance premium was also refunded – Later on 31.8.2017, Insurance policy was declined – Justification. Held, the conduct of the insurance company appears to be malafide. The reason in letter dated 3.8.2017 for deferment of policy by 6 months was surprisingly shown as treadmill test finding, when no abnormality was detected in the said test report. The letter dt. 3.8.2017 was sent through Blue-Dart Courier and tracking details show that it was dispatched only at 19:38 hours on 16.8.2017. Thus, the ante-dated letter (letter dt. 3.8.2017) was hurriedly sent only after getting information about the death of the insured on 16.8.2017. Significantly, 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 and policy was declined on 31.8.2017. This was a clear case of deficiency in service and non-bonafide.

Adv Saba Hassan

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