Delhi

West Delhi

CC/13/121

Smt. Usha Jain W/oShri R.L. Jain - Complainant(s)

Versus

Aviva Life Ins. Co. India Ltd - Opp.Party(s)

31 Mar 2017

ORDER

    CONSUMER DISPUTES REDRESSAL FORUM (WEST)

                                        GOVERNMENT OF NCT OF DELHI

  150-151, Community Centre, C-Block, JanakPuri, New Delhi – 110058

 

                                                                                                        Date of institution: 07.03.2013

Complaint Case. No.121/13                                                          Date of order:31.03.2017

IN  MATTER OF

Smt. Usha Jain W/o Shri R.L. Jain, B-3/177 Janak Puri, New Delhi-110058.

Complainant

VERSUS

1.        Aviva Life Ins. Co. India Ltd., Aviva Tower, Sector Road, Opp. Golf Course, DLF V, Sector-43, Gurgaon, Haryana-122003.                                      Opposite party No.1

2.        Induslnd Bank, B-1 Community Centre, Janakpuri, New Delhi-110058.                                                                                                                                Opposite party No.2

ORDER

R.S. BAGRI,PRESIDENT

Smt. Usha Jain here in the complainant has filed this consumer complaint under Section 12 of the Consumer Protection Act hereinafter in short referred the Act against Aviva Life Insurance Company India Ltd. and others hereinafter referred as the opposite parties with averments that the complainant had a saving bank account with the opposite party no.2. The opposite party no.2 and its officers act as agents of the opposite party no.1. Mrs. Kusum, Officer of the opposite party no.2 in June, 2010 persuaded/ insisted the complainant to take policy of the opposite party no.1 assuring that the policy will fetch 15% return more than FD in the opposite party no.2.

That on continuous persuasion and assurance of the officers of the opposite party no.2, the complainant took policy no.APG2616774 from the opposite party no.1 and deposited Rs.55,000/-. Thereafter the complainant deposited two annual premiums @Rs.55,000/- from the account of the opposite party no.2. The complainant after lock-in period of three years surrendered the policy with hope to get better returns @15%. But the complainant received Rs.1,64,201/- only on 28.09.12 against total deposit of Rs.1,65,000/- less than the principal sum.

That the complainant on 17.08.12, 19.09.12 and 15.10.12 made representations to the opposite parties but to no effect. It is alleged by the complainant that the policy was forced upon the complainant by the officers of the opposite party no.2 ignoring the principles of utmost good faith of insurance contract. This is short of misselling of the insurance policy and unfair trade practice by the opposite parties. Hence, the present complaint for directions to the opposite parties to make good loss of Rs.45,000/- of the complainant and pay compensation of Rs.25,000/- for harassment and cost of litigation.

After notice the opposite party no.1 appeared and filed reply while contesting the complaint and raising preliminary objections that the complaint is false, malicious, malafide and abuse of process of law. The complaint is not maintainable on the facts and law and is without cause of action. The complaint is based on conjectures and surmises and the complainant has concealed correct and material facts. There is no unfair trade practice and deficiency in service on the part of the opposite party and prayed for dismissal of the complaint.  

On merits the opposite party no.1 asserted that the complaint on 08.06.09 submitted proposal form no.NNU15004845 after going through key feature documents. But the complainant did not cancel the policy and continuously paid premium of the policy for three years without raising any objection. The complainant also signed a benefit illustration form clearly explaining policy and premium terms for seven years. It is further asserted that all benefits and returns under the policy are in accordance with policy terms and conditions. The complainant has purchased many policies and she was aware of she was investing and what was being purchased  by her. The complainant has purchased pension plus unit linked policy for seven years. She has been inquiring about returns of the policy from the opposite party no.1. The complainant was explained that the rates are assumed returns and no guarantee. The complainant surrendered the policies after 3  years and maturity value of Rs.1,64,201/- was paid to her. All other allegations of the complaint are vehemently denied by the opposite party no.1 and once again prayed for dismissal  of the complaint.

Despite service none appeared on behalf of the opposite party no.2, therefore, the opposite party no.2 was proceeded ex parte vide order dated 04.06.13.

The complainant filed rejoinder to the reply of the opposite party no.1 while controverting stand of the opposite party no.1 and reiterating her stand.

When Smt. Usha Jain – the complainant  was asked to lead evidence, she tendered her affidavit narrating facts of the complaint. The complainant in support of her version also relied  upon Annexure-1 copy of her account with the opposite party no.2, Annexure-2(1) receipt dated 22.06.10, Annexure-2(2) intimation of appointment of relationship manager by the opposite party no.2, Annexure-3 assumed calculation of her policy, Annexure-4(1) representation dated 17.08.12, Annexure-4(2) representation dated 19.09.12, Annexure-4(3) representation dated 15.10.12 and Annexure-5 copy of newspaper.

When the opposite party no.1 was asked to lead evidence, the opposite party no.1 tendered in evidence affidavit of Praman Preet Singh Gujral, Manager Legal. They have also relied upon proposal form no.NNU15004845, customer information report, copy of cheque no.044444 dated 26.05.09, copy of PAN Card no.AFJPJ9949M of complainant, copy of customer declaration  dated 08.06.09 with benefit illustration, proposal form no.NNU15004845 with schedule of payment of premiums and rates of return and welcome letter dated 13.07.13 etc.

Both the parties have also submitted written arguments in support of their respective contentions.

We have heard Shri R.L. Srivastava, advocate for complainant and Ms. Charu Sachdeva, advocate for the opposite party no.1 and have gone through the material on record carefully and thoroughly.

From the complaint, reply to the complaint, rejoinder to the reply of the opposite party no.1, affidavits of the parties, documents relied upon by both the parties and written submissions filed by the parties it is common case of the aprties that the complainant submitted proposal form no.NNU15004845 on 18.06.09 and on the basis of the proposal form the opposite party no.1 issued pension plus unit linked policy no.APG2616774 on 19.06.09 in her favour. The opposite party no.1 on 25.06.09 sent letter of acceptance to the complainant informing her right to accept or cancel the insurance policy. The complainant did not exercise her right of cancellation of the policy in stipulated period as provided under Regulation-4 of Insurance Regulatory and Development Authority (Protection of policy holders interest) Regulation 2002 hereinafter in short referred as the IRADA Regulations. Which reads as under:-

Proposal for Insurance

1. Except in cases of a marine insurance cover, where current market practices do not insist on a written proposal form, in all case, a proposal for grant of a cover, either for life business or for general business, must be evidenced by a written document. It is the duty of an insurer to furnish to the insured free of charge, within 30 days of the acceptance of a proposal, a copy   of the proposal form.
2. Forms and documents used in the grant of cover may, depending upon the circumstances of each case, be made available in languages recognized under the Constitution of India.
3. In filling the form of proposal, the prospect is to be guided by the provisions of Section 45 of the Act. Any proposal form seeking information for grant of life cover may prominently state therein the requirements of Section 45 of the Act.
4. Where a proposal form is not used, the insurer shall record the information obtained orally or in writing, and confirm it within a period of 15 days thereof  with the proposer and incorporate the information in its cover note or policy. The onus of proof shall rest with the insurer in respect of any information not so recorded, where the insurer claims that the proposer suppressed any material information or provided misleading or false information on any matter material to the grant of a cover.
5. Wherever the benefit of nomination is available to the proposer, in terms of the Act or the conditions of policy, the insurer shall draw the attention of the proposer to it and encourage the prospect to avail the facility.
6. Proposals shall processed by the insurer with speed and efficiency and all decisions thereof shall be communicated by it in writing within a reasonable period not exceeding 15 days from receipt of proposals by the insurer.

From bare reading of the Regulation 4 of  IRADA Regulations it is evident that the insurer is duty bound to furnish cover note to the insured within 30 days of acceptance of proposal form and the insured can cancel the policy within 15 days  after receipt of the insurance policy. But in the instance case the complainant/ insurer did not exercise her right provided under Regulation-4 of the IRADA Regulation. She kept on paying premium of the policy for three years without any objection. Therefore, the insurance policy and cover being a contract, the parties are bound by the same. The complainant/ insured cannot challenge the policy after three years after receipt of value of the policy.

Further more the policy is a unit linked policy whereby the investment is made by the complainant through share market speculative transactions. The unit linked policies are different from other insurance policies and are subject to different risk factors. The investment risk is born by the policy holder.

Learned counsel for the opposite party no.1 argued that the complainant has purchased a unit linked policy whereby the investment is made through share market/ speculative transactions and main motive for investment is for profit and gains. She has drawn our attention to order dated 23.04.2012 passed by Hon’ble National Commission in Revision No658 of 2012 titled Ram Lal Aggarwala Vs. Bajaj Allianz Life Insurance Co. Ltd. and has vehemently argued that the complaint in respect of the claim under unit linked insurance policy is not maintainable under the Act the money having been invested in speculative business.

After giving our thoughtful consideration to the rival contentions, we feel that the arguments of the learned counsel for the opposite party have considerable force and the same must prevail. The copy of the proposal form itself shows that the complainant affixed her signature on the proposal form. The complainant has nowhere denied that the said insurance policy is a unit linked policy whereby the investment is made through share market/ speculative transaction. Pertinently, all unit linked policies are different from traditional insurance policies and are subject to different risk factors. In the said policy, the investment risk in investment portfolio is borne by the policy holder. The copy of judgment dated 23.04.2013 in Revision Petition No.658 of 2012 titled as Ram Lal Aggarwalla V. Bajaj Allianz Life Insurance Co. Ltd. (Supra) shows that in that case the dispute was regarding Unit linked insurance policy and the claim under that policy was disallowed by the District Forum by making following observations:-

“The investment made by the petitioner/ complainant was to gain profit. Hence, it was invested for commercial purposes and, therefore, the petitioner/ complainant is not a consumer under the opposite parties. The State Commission, Odisha in Frist Appeal No.162 of 2010 in the case of Smt. Abanti Kumari Sahoo V. Bajaj Allianz Life Insurance Company Ltd., have held that the money of the petitioner / complainant invested in the share market is no doubt a speculative gain and the speculative investment matter does not come under the Act and accordingly, the State Commission dismissed the appeal”.

Importantly, against the order of the District Forum, the complainant filed an appeal before the Hon’ble State Commission which was dismissed. Dis-satisfied with that order, the complainant filed a revision petition before the Hon’ble National Commission and the Hon’ble National Commission did not find any jurisdictional error, illegality or infirmity in the order passed  by the Hon’ble State Commission warranting interference. The matter relating to unit linked policies was also agitated in Smt. Parmajit Kaur Vs. Aviva Life insurance Company India Limited (Supra) and Metlife India Insurance Co. Vs. Gurjit Singh (Supra) decided by the Hon’ble State  Commission, Punjab and it was held that the complaint in  respect of the claim under unit linked insurance policy is not maintainable under the Act the money having been invested in a speculative business.

Similar are facts of the present complaint. Admittedly the insurance policy of the complainant is a unit linked policy and different from traditional insurance policies. Therefore, the complainant is not a consumer under  Consumer Protection Act and the complaint is not maintainable.

In the light of our above discussion and observations, the complaint is dismissed.

Order pronounced on :30.03.2017

• Copy of order be sent to the concerned parties free of cost.
• Thereafter, file be consigned to record.

                  

(PUNEET LAMBA)                                                                          ( R.S.  BAGRI )

                           MEMBER                                                                             PRESIDENT