While rejecting four similar representations filed by the State Life Insurance Corporation of Pakistan (SLICP) against the orders of the Wafaqi Mohtasib (WM), President Dr Arif Alvi directed SLICP to settle claims worth Rs 1.95 million to four claimants and improve and strengthen its business procedures and processes before and after the award of policies to eliminate the possibilities of future litigations causing unnecessary hassle to policy beneficiaries as well as to save the cost incurred to the state and litigants during the cumbersome litigation processes. In his decision, the President observed that maladministration on part of SLICP was established and ordered SLICP to not only settle the claims worth Rs 1.95 million with four claimants but also pay them the profit accumulated during the entire period of payment withholding. The President observed that the point of view of SLICP was not tenable as the policyholders were declared medically fit in the medical examination by the authorized medical officer of SLICP prior to the issuance of the policy as well as by the Field Officers who had declared the deceased policyholders healthy at the time of the issuance of the policies, therefore, the pleas of the pre-insurance ailments were hit by the principle of estoppel. The President also made reference to the Contract Act 1872 and said that where the consent was caused by the misrepresentation of fraudulent means, the contract was not voidable if the party whose consent was so caused had the means of discovering the truth with ordinary diligence. The President also noted that as per Lahore High Court’s decision ailments such as hypertension, diabetes and Mellitus could not be called exceptional reasons as the majority of people having such ailments, by remaining more careful in their life, lived either for decades or longer than people not having such diseases, therefore, the concealment of such diseases could not be termed as done fraudulently. As per details, four different policyholders had purchased life insurance policies from SLICP for the sum assured of 900,000, 425,000, 425,000 and 200,000 respectively. After their deaths, their family members (the complainants) applied for insurance claims to SLICP, which were repudiated on the grounds that the deceased policyholders had pre-insurance ailments such as liver disease, diabetes, hepatitis or heart disease, which they had willingly not disclosed at the time of obtaining the policies. Feeling aggrieved, the complainants approached the Wafaqi Mohtasib, which passed the orders in their favour. The President, however, rejected the SLICP’s appeals against the orders of WM.
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