BEFORE THE DISTRICT FORUM:KURNOOL

Present: Sri.P.V.Nageswara Rao , M.A., LL.M., President(FAC)

And

Smt. C.Preethi,  M.A.LL.B., Lady Member

Thursday  the 06^th day of August,  2009

C.C.No.167/08

 Between:

P. Raghavendrachar,  S/o. Subba Raya Achar,  Proprietor, New Indira Bhavan Lodge,

H.No.18-314/1, P.N.Road, Adoni-518 301.                 …Complainant

-Vs-

1. The Branch Manager, Life Insurance Corporation of India ,

D.No.21/403/5, Behind R.T.C. Bus Stand, Pattikonda Road, Adoni-518 301.

1. The Divisional Manager, Life Insurance Corporation of India, Jeevan Prakash,

D.No.1-55, College Road, Post Box No.10, Kadapa-516002.                                         … Opposite parties 

       This complaint is coming on this day for orders in the presence of Sri.T.Siva Kumar, Advocate, for the complainant, and  Sri.I.Anantha Rama Sastry, Advocate for opposite parties  and upon perusing the material papers on record, the Forum made the following.

ORDER

(As per Sri. P.V.Nageswara Rao,President (FAC)

C.C.167/08

1.     Complaint filed under section 12 of the Consumer Protection Act 1986.

2.     The brief facts of the complaint is as follows:-  The complainant had applied  for insurance policy  under  proposal  No.13391  dated 13-02-2007 under a table and term  14-21. The opposite party No. 1 informed the complainant to submit the complainant medical reports through a letter dated 17-03-2007. Medical report  was submitted  . Again the opposite party No. 1 requested the complainant by way of letter dated 21-04-2007 to submit another  medical report. It was also submitted. Then the opposite parties  issued the policy. The  complainant  paid  the 1^st   premium of Rs.4,373/- on 14-05-2007.  The policy  was  issued  bearing   No. 654647219  commenced   from  14-05-2007 with maturity period  on 14-05-2028 ie.,  after 21 years  with sum assured  Rs.50,000/- and premium was  yearly premium .It included extra health  premium also. On 29-11-2007 opposite party No. 1 addressed a letter that the proposal was accepted  by opposite party No. 2 for 16 years  term and table 14, but  by oversight  it was issued  under table and term 14-21 . They requested the complainant  to give his consent  for table 14-16  or cancel the same. The complainant requested  the opposite parties  by way of letter  dated 19-11-2007 to continue the policy already accepted under table 14-21  or refund  the amount with interest. The complainant sent  a letter on 26-11-2007 . Again the complainant addressed another letter dated 15-03-2008 . There was no  response. The opposite parties  sent a renewal  premium notice  to the complainant to pay Rs.4,373/-  towards 2^nd  year premium . The complaint paid the sum as per the demand under the  impression  that the opposite parties  had accepted  and continued the policy. The 2^nd premium was  paid by way of cheque. The receipt No. was 7662427 . The third premium  was due in 2009. Therefore the policy was in continuation  . On 06-09-2008 the complainant received  a letter along with cheque for Rs.3,697/- dated 29-08-2008 stating that they recovered Rs.5049/- and paid Rs.6,097/-  towards final  proceeds and the policy  was cancelled . The cheque was  not sent for collection. The policy was cancelled unilaterally  without any mistake on the part of the  complainant . The fraud  and mistake was  on the opposite parties . Therefore  the complaint was filed directing the opposite parties  either to continue  the policy under table and term  14-21or pay Rs.50,000/- the sum assured  and also Rs.15,000/- for mental agony and Rs.5,000/- towards medical expenses and costs.

3.     The opposite party No. 2 filed a written version adopted by opposite party No. 1 with a memo  . It was not  correct  that the complainant   applied for   policy  under proposal  No.  13391 dated 28-02-2007  under table and term  14-21 . But it was  under table and term  5-16 for sum assured  of Rs.50,000/- on 28-02-2007 under the proposal No.13391 . As per the medical reports , the proposal  papers were referred to zonal office for their decision. The Zonal Office accepted  the proposal under substandard  live category  of class V  with Health Extra at Rs.19.62/-  per one thousand sum assured under table and term  14-16  for Rs.50,000/- sum assured . The complainant gave consent for health extra at Rs.19.62/- per thousand and table and term  14-16  for Rs.50,000/-  vide   the  letters   dated 28-04-2007  and  19-05-2007 . By othersight  the policy No.654647219  was  issued on 04-06-2007  under table and term  14-21 instead  of14-16 . It was typographical  error. It was pointed out during inspection . So a letter was  written dated 19-11-2007 to the complainant to confirm with consent for table  and  term  14-16 for Rs.50,000/- sum  assured . The complainant  gave   his   consent   by  way   of   letter   dated 26-11-2007 for table and term 14-16. So it was corrected. The complainant  submitted another letter dated 15-03-2008 requesting to continue  the policy under table and term  14-21  or refund the amount paid with interest. The risk of the complainant was under substandard  category V  and so it was  decided  to cancel the policy  and refund the premium  without interest , excluding Health Extra premium by recovering  risk premium  but two years and expenses. The opposite parties sent a cheque bearing No. 028614 dated 29-08-2008 for Rs.3,697/- . The amount paid  by the complainant for two premiums was Rs.8,746/- After deducting  Rs.5,049/- is towards accidental  benefit of Rs.200/- , health  care extra  of  Rs. 1962/- and risk premium  for 1^st year , Rs.1287/- and for 2^nd year Rs.1378-50 paise and other miscellaneous charges Rs.222/- i.e, totally Rs.5,049/-. The net amount  was Rs.3,697/- . Therefore the opposite parties refunded the amount of Rs.3,897/-. As the risk  of life of the complainant  was covered by the opposite parties an amount of Rs. 2,665-50 /- was recovered  while refunding in the premium. The opposite parties  were not liable  for any relief claimed by the  complainant. Thus the complaint may be dismissed with costs .

4.      On the basis of the above pleadings the points for consideration are

(i) whether there is any deficiency of service on the part of the opposite parties .

(ii) Whether the complainant is entitled to the relief as prayed for?

(iii) To what relief?

5.                On behalf of the complainant  Ex.A1 to A8 marked , on behalf of  the opposite parties Ex.B1 to B7 were marked.

Both parties  filed written arguments. .

6.     Point No. 1 & 2 :  The complainant  submitted a proposal  bearing No. 13391 under plan and term 5/16 for sum assured of Rs.50,000/- with annual premium . The Ex.B1 was the proposal form. Before issuing the policy , the complainant was requested to take medical  check up and submit the report. The Ex.B3  was the proposal review slip of the  opposite parties. In Ex.B3 it was mentioned that the policy holder had only table and term 14-16 instead of 5-40 . It was also  mentioned  in Ex.B3 on the reverse side that the table and term   14/16  had to be changed subject to the consent of the proposer . However the opposite parties  issued a policy  under Ex.B2 under table and term  14-21 with sum assured of Rs.50,000/- with annual premium of Rs.4,373/- under policy No.654647219 and the maturity period  was 21 years  i.e, 14-05-2028 . The proposer i.e, the complainant  gave a consent  letter on 28-04-207  and 19-05-2007 under Ex.B4 and B5 accepting  change and plan  to 14-16 and health extra category  Class  V. On 19-11-2007 the opposite parties  addressed a letter  to the complainant  that the proposal  was accepted for the table 14-16 but by oversight  it was completed in the  proposal form  under table 14-21 . So the opposite parties  requested  the complaint to consent for  14-16 table otherwise  the policy would be forced to cancel.  A Letter was Ex.B6. On 26-11-2007  the complainant gave a reply to Ex..B6 requesting  to continue  the policy  under 14/16 or pay the policy amount  with interest and left it  to the decision of the corporation. A  letter was Ex.B7.

7.     The complainant filed original policy under Ex.A3 with a table and term  14/21 . He filed Ex.A1 a letter from the opposite party  dated 17-03-2007 requesting  him to file the medical reports  regarding ECG, Lipidogram ,  and BST . Ex.A4 and B6 were one and same. The complainant  wrote a letter dated 26-11-2007  under Ex.A5. The same was filed by the opposite parties under Ex.B7 . The complainant on 15-03-2008 wrote a letter  to the opposite parties to continue  the policy under 14-21  table and term . The letter  was Ex.A6  dated 15-03-2008 . He was  asked to under go  2^nd medical check up by the opposite party who wrote a letter on 21-04-2007 . It was Ex.A2. While so the opposite parties issued a renewal  premium receipt  on 09-06-2008 to the complainant  to pay Rs.4,373/-  as premium amount under table and term  14-21. It  was Ex.A7. But the opposite parties  after considering the proposal and the medical reports  came to conclusion  that the complainants  policy would come under table and term  14-16 instead of 14-21 . The opposite parties  requested the complainant either  to give consent  for change of table and term   to 14-16 or otherwise to cancel the policy inview to his health condition  . Instead of accepting  for  14-16 the complainant addressed  letter under Ex.A5 and Ex.A6 , he requesting  to continue the policy  under original table and term 14-21 or refund the policy of Rs.50,000/- with interest. The policy amount  of Rs.50,000/- should not be  refunded . The opposite parties  gave option to the complainant  to change the  term from 21 years  to 16 years  and pay  the extra premium under the policy , but the complainant  did not accept . Therefore the opposite  parties  refunded  Rs.3,697/- by way of cheque bearing No. 028614  dated 29-08-2008 on Corporation Bank , Adoni,  The cheque with letter of the  opposite parties  to the complainant  was Ex.A8 . But the opposite parties  deducted certain amount under various heads  of Rs.5,049/- from out of  two premium amount of Rs.8,746/- and issue cheque  for balance amount  of Rs.3,697/- . When  the policy  is canceled the opposite parties  should refund the entire premium amount of Rs.8,746/- . Instead of it they paid only Rs.3,697/-. It would amount to deficiency of service . Therefore , the complainant  is entitled  to the entire  premium amount of Rs.8,746/-  . Thus the  opposite parties  are liable to pay the balance amount Rs.5,049/- to the complainant.

8.     Point No. 3  : In the result , the complaint is allowed  without costs directing the  opposite parties 1 and 2 to refund the balance  of premium amount of Rs.5,049/- (Rupees five thousand forty nine)  to the complainant within  30 days  from the  date of receipt of this order. The rest of the claim is dismissed without costs. 

   Dictated to the stenographer, transcribed by her, corrected and pronounced by us in the open bench on this the 06^th day of August, 2009.

      Sd/-                                                    Sd/-

LADY MEBER                                          PRESIDENT (FAC)                

APPENDIX OF EVIDENCE

Witnesses Examined

For the complainant :Nil             For the opposite parties :Nil

List of exhibits marked for the complainant:-

Ex.A1.          Letter dated 17-03-2007 addressed to complainant

Ex.A2.          Letter dated 21-04-2007 addressed to complainant

Ex.A3.          Policy bond No. 654647219

Ex.A4.         Letter dated 19-11-2007 addressed to complainant by

Opposite party No.1.

Ex.A5.         Letter dated 26-11-2007 of complainant  to opposite party No. 1 in reply to Ex.A4.

Ex.A6.         Letter dated  15-03-2008 addressed  by complainant to

Opposite party No. 1 in reply to Ex.A4.

Ex.A7.         Renewal premium receipt .

Ex.A8.         Cheque dated 29-08-2008  for Rs.3,697/- and its covering

Letter dated 06-09-2008.

List  of exhibits marked for the opposite parties:   

Ex.B1.          Proposal for insurance  in 4 papers.

EX.B2.          Policy bond No.654647219 .

Ex.B3.          Proposal Review slip dated 01-03-2007 in 2 papers.  

Ex.B4.          Letter dated 28-04-2007 .

Ex.B5.          Letter dated 19-05-2007

Ex.B6.          Letter dated 19-11-2007 of opposite party to complainant.

Ex.B7.          Letter dated 26-11-2007 of complainant to opposite party

                   (reply to Ex.B6)         

          Sd/-                                                            Sd/-

LADY MEMBER                                            PRESIDENT (FAC)             

// Certified free copy communicated under Rule 4 (10) of the

A.P.S.C.D.R.C. Rules, 1987//

Copy to:-

Complainant and Opposite parties

Copy was made ready on                :

Copy was dispatched on          :