An insurance company can reject a claim if the policy holder had understated his age at the time of joining the scheme, the National Consumer Commission has held.
"Such a claim can rightly be repudiated on the ground of concealing material facts," it observed while giving a clean chit to the Life Insurance Corporation (LIC) of India for turning down a claim citing that the policy holder had mentioned his date of birth incorrectly.
In this case, the company found out the policy holder, who died within three months of taking the policy, had mentioned his date of birth incorrectly in the proposal form by submitting a copy of his licence as proof.
The Commission said a person's age could rightly be determined from his school certificate rather than on the basis of entry registered in the licence as the former have higher evidentiary value.
"The certificate issued by the principal of the Government Secondary School with regard to the date of birth of the life assured will indeed have an overriding evidentiary value than the one on the driving licence which is entered on the basis of the application of the applicant," the Commission, headed by its President Justice Ashok Bhan, said.
The LIC approached the Commission challenging dismissal of its plea by the Rajasthan State Consumer Commission which upheld the order of District Forum directing the Corporation to pay Rs 2.10 lakh with interest.
The Commission held that lower fora had erroneously decided in favour of complainant Hira Devi by relying on the date of birth registered in driving licence.
"Both the fora below have taken the view that since the LIC itself had accepted the date of birth as recorded in the driving licence, they could not subsequently go behind their own record and discard it. This view is completely erroneous," it said.
The policy holder died within three months of taking the policy following which the LIC found that the deceased had understated his age.
"The possibility of the life assured understating his age to avoid a rigorous medical examination cannot be completely ruled out," the Commission said.
It gave precedence to the date of birth as certified by the principal of the Government Secondary School over that of the driving licence.
Earlier, the LIC while repudiating the claim informed Devi that the deceased had given wrong information about his age as he mentioned his age as 43 years in the proposal form while his actual age according to the school certificate was 53 years.