STATE LIFE INSURANCE CORPORATION Versus Mst. NUSRAT AMJAD
CH. MUHAMMAD IQBAL, J .---This is an Insurance Appeal under section 124 of the Insurance Ordinance, 2000 against the judgment dated 17.03.2020 passed by the Insurance Tribunal, Nankana Sahib whereby the application for recovery of policy proceeds amounting to Rs.200,000/- with accrued bonuses and Family Income Benefit @ 15% for 20 years under Policy No.602144321-7 along with liquidated damages under section 118 of the Insurance Ordinance, 2000, filed by the respondents, was allowed.
2. Brief facts of the appeal are that Amjad Ali was holding a policy bearing No.602144321-7 commencing from 29.05.2009. The insured died on 26.08.2012 and his legal heirs tiled death claim of the insured which was repudiated by the appellant on 31.12.2013. The respondents filed a petition against the appellants for recovery of policy proceeds amounting to Rs.200,000/- with accrued bonuses and Family Income Benefit @ 15% for 20 years under Policy along with liquidated damages under section 118 of the Insurance Ordinance, 2000. The appellants filed contesting reply of the said application. The learned Insurance Tribunal framed as many as 9 issues. The respondent No.1/Mst. Nusrat Amjad herself appeared as P.W.1 and produced in documentary evidence original payment receipt (Exh.A/1), Death Certificate (Exh.A/2), Repudiation Letter dated 31.12.2013 (Exh.A/3), Discharge Voucher (Exh.A/4), Policy Schedule (Mark-A), Guardianship Certificate (Mark-B) and Discharge Voucher (Mark-C).
Conversely the appellants produced in its evidence Nadeem Shahid, Claim Incharge (R.W.1) and Muhammad Aslarn Anjum, Assistant Manager (R.W.2) and in documentary evidence produced Authority Letter (Exh.R.1), Proposal Form (Exh.R.2), Insurance Policy Contract (Exh.R.3), Letter dated 18.10.2012 (Exh.R.4), Claim Form (Exh.R.5), Letter written to Registrar Sheikh Zayed Hospital (Exh.R.6), Discharge Voucher dated 17.02.2016 (Exh.R.7), Discharge Voucher dated 26.10.2017 (Exh.R.8), receipt A.D (Exh.R.9), Letter in favour of Muhammad Aslam Anjum (Exh.R.10), letter of Deputy Manager (Exh.R.1 1), Inquiry Report (Exh.R.12), Death Certificate of Amjad Ali (Mark-A) and report of Zonal Claim Committee dated 19.05.2014 (Mark-B). After recording the pro and contra evidence of the parties to the lis the learned Insurance Tribunal finally accepted the application of the respondents and decreed the claim as prayed for vide judgment dated 17.03.2020. Hence, this appeal.
3. Learned counsel for the appellants at the very outset submits that he only presses the appeal to the extent of liquidated damages granted by the learned Insurance Tribunal.
4. We have heard the arguments of learned counsels for the parties and have gone through the record with their able assistance.
5. With the issuance of two discharge vouchers (dated 17.02.2016 and 26.10.2017), the appellants admitted the correctness of the death claim and only a limited issue regarding the fixing of liability of the delay and grant of liquidated damages need judicial determination.
The controversy of the delay is involved in issue No.6 which is as under:-
6. Whether no intentional delay can be attributed to the respondents because the applicant did not submit complete papers? OPR.
Onus of the above issue was upon the appellants. The appellants produced Nadeem Shahid, Incharge Claims, State Life Insurance Corporation, as R.W.1 who stated that on 29.05.2009 Amjad Ali purchased Life Insurance Policy No.602144321-7 sum assured of Rs.200,000/- which continued for a period of 3 years 2 months and 26 days; that on 26.08.2012 Amjad Ali died; that Mst. Nusrat Amjad submitted claim form (Exh.R.5); that after due process, the claim was repudiated on 31.12.2013. In cross examination, he admitted that before the repudiation of claim or payment of amount, no document was required from the legal heirs of the deceased policy holder; that on 22.02.2013 the claim was admitted by the applicant and was received on the same day in the office of the corporation. The condition No.18 of the policy contract is related to the liquidated damages. RW2 in his statement supported the version of the appellants.
6. Conversely Mst. Nusrat Amjad widow of Amjad Ali in support of the claim for grant of liquidated damages, herself appeared as P.W.1 and deposed that her husband Amjad Ali purchased a policy from State Life Insurance Corporation with additional contract of Family Income Benefit @ 15% for 20 years commencing from 2009 and after death of her husband on 26.08.2012, she on behalf of herself as well as on behalf of her minor children being their guardian lodged death insurance. The appellants repudiated the claim vide letter dated 31.12.2013; that during the pendency of proceedings on the application, appellants of their own issued Discharge Voucher amounting to Rs.226,947/- on 17.02.2016 as well as another Discharge Voucher amounting to Rs.423,696/- dated 26.10.2017 without adding the liquidated damages. This offer of the appellants was refused by her as the amount was not in consonance with the insurance contract; that her claim was delayed by the appellant for 06 years 02 months and 20 days, as such she is entitled to receive insurance contract amounting to Rs.829,262/- as well as the liquidated damages as per law. She prayed for grant of death claim as prayed for.
7. As the matter in issue is regarding the grant of liquidated damages and section 118(2) of the Insurance Ordinance, 2000, deals with the payment of liquidated damages. For ready reference aforesaid provision is reproduced as under:
118. Payment of liquidated damages on late settlement of claims.-
(1)....
(2) The liquidated damages payable under subsection (1) shall be payable for the period during which the failure continues and shall be calculated at monthly rests at the rate five per cent higher than the prevailing base rate.
Under Clause 18 of the Policy issued by the State Life Insurance Corporation of Pakistan (Mark-A) which is an admitted document, the criteria for grant of liquidated damages is prescribed. For ready reference, relevant portion of Clause 18 of 'the Policy is reproduced as under:
18. Liquidated Damages:-
Where payment under this policy becomes due and the person entitled thereto has complied with all the requirements, including the filing of complete papers, for claiming the payment, the State Life shall, if it fails to make the payment within a period of ninety days from the date on which the payment becomes the or the date or which the claimant complies with the requirements, whichever is later, pay as liquidated damages on the amount so payable unless State Life proves that such a failure was due to circumstances beyond its control.
Admittedly insured Amjad Ali died on 26.08.2012 and information of death of the insured was conveyed to the appellants' Manager who required the supply of certain documents for insurance claim through letter dated 18.10.2012 (Ex.R4). After fulfillment of the requisite formalities death claim was filed on 22.02.2013 thereafter the appellants were under contractual obligation to make payment of amount due (claim) within 90 days whereof but the appellant unnecessarily delayed matter and illegally repudiated the claim on 31.12.2013, but whereafter voluntarily issued the Discharged Vouchers, as such it can conveniently be observed that it is the appellants who are responsible for the delay in settlement of the claim in time and has also failed to prove that delay was due to circumstances beyond their control, as such, the learned Insurance Tribunal rightly decided this issue against the appellants.
8. The respondents through oral as well as documentary evidence successfully proved that they complied with all the requirements of the appellants for the grant of insurance policy but the appellants failed to make the payment of the policy within prescribed period of 90 days without any convincing and just explanation, as such, the learned Tribunal' rightly decided the issue No.1 in favour of the respondents and granted the liquidated damages as prayed for.
9. Learned counsel for the appellant has not been able to point out any illegality or material irregularity, mis-reading and non-reading of evidence in the impugned judgment and decree passed by the learned trial court and have also not identified any jurisdictional defect.
10, Resultantly, this appeal having no merits is hereby dismissed with no order as to costs.
MH/S-35/L Appeal dismissed.