DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, BARNALA, PUNJAB.

 

Complaint Case No : 49/2017

Date of Institution : 24.04.2017

Date of Decision : 16.03.2018

Baldev Singh Sekhu son of Sr. Kartar Singh resident of Sood Street, Handiaya Road, Barnala, Tehsil and District Barnala.

                   …Complainant

Versus

1. Aviva Life Insurance Company Limited, Head Office Aviva Tower, Sector Road, Opposite Gold Course, DLF-Phase V, Sector-43, Gurgaon through its Director. 

2. Aviva Life Insurance Company Limited, Opposite Old Cinema, Barnala now shifted/Immerged Ground Floor, SCO 16, Phatak No. 22, City Centre Patiala through its Branch Manager. 

            …Opposite Parties

Complaint Under Consumer Protection Act, 1986

 

Present: Sh. Lokeshwar Sewak counsel for the complainant.

Sh. Dhiraj Kumar counsel for opposite parties. 

Quorum.-

1. Shri Sukhpal Singh Gill : President

2. Ms. Vandna Sidhu : Member

ORDER

 

(SUKHPAL SINGH GILL, PRESIDENT)

    The complainant namely Baldev Singh has filed the present complaint against Aviva Life Insurance Company, Head Office through its Director and Aviva Life Insurance Company, Barnala Branch through its Branch Manager (hereinafter called as opposite parties). It is alleged that the complainant is a senior citizen about 70 years and had an account with Bank of Punjab, Barnala which has been emerged in HDFC Bank, Barnala. The complainant had applied for the agricultural limit and same had been sanctioned with the pre-condition that the complainant must invest for the life insurance policy of the opposite parties whose branch was earlier on the first floor of Bank of Punjab Branch Barnala and now the said Branch has left Barnala and shifted/emerged at Patiala Branch. 

2. It is further alleged that under the pre-condition the complainant obtained a policy from the opposite parties of Rs. One lakh and its yearly premium was ten thousand rupees per year and Manager of opposite parties assured the complainant that he needs to deposit three installments of Rs. 10,000/- per installment with the opposite parties and its date of final installment is 21.7.2032 or if the complainant would not desire to continue with the policy he can close his policy and the amount of installments i.e Rs. 30,000/- alongwith interest returned to the complainant and after settled all the conditions the complainant purchased the policy No. LLG1242816 from the opposite parties and regularly deposited the installments of Rs. 10,000/- every year. It is further alleged that complainant does not know about the share market but the opposite parties put the money of the complainant in Unit Link Plan without the consent of the complainant. The complainant made the payment of Rs. 10,000/- as first installment and the policy was received by the complainant bearing No. 20022075 and complainant deposited further amount of Rs. 10,000/- each installment with the opposite parties at Barnala up to three years. The complainant needs money so he wants to withdraw his deposited amount of Rs. 30,000/- alongwith interest after three years. So, he approached the opposite parties and the fact came to knowledge of the complainant that his money has been invested in some market plan i.e. ULIP Plan and the value of the invested money of the complainant is now four hundred rupees only. This act and conduct of the opposite parties amounts to unfair trade practice and deficiency in service. Hence, the present complaint is filed for seeking the following reliefs:-

(1) To refund the amount of the complainant of Rs. 30,000/- alongwith interest up to date. 

2) To pay Rs. 50,000/- as compensation for mental agony and harassment. 

3) To pay Rs. 5,000/- on account of litigation expenses.

3. Upon notice of this complaint the opposite parties filed the written version taking legal objections on the grounds that the present complaint is barred by limitation. The complainant paid the premium till 2012 and thereafter he neither paid any amount nor approached the company for any refund, rather file the present complaint after lapse of 5 years so present complaint is time barred. Further, the complainant has suppressed material facts from this Forum. Further, the complainant has no cause of action to file the present complaint. Further, the intricate questions of law and facts are involved in the present complaint and parties have to lead evidence by examining the witnesses and said witnesses are to be cross examined by the other party but the procedure under the Act is summary in nature so complainant may file civil suit seeking the alleged relief. Further, the complaint is not maintainable under the Act. The opposite party received proposal form bearing No. UP-10117509 duly filled and signed by the complainant seeking insurance of his life under the Aviva Life Long Unit Linked. On receiving the same the company issued the policy bearing No. LLG-1242816/01030950. The complainant also signed a benefit illustration after fully understanding the terms and conditions of the policy. According to Clause 6 (2) of the Insurance Regulatory and Development Authority Regulations, 2002 every policy document sent by it is accompanied by a forwarding letter which clearly mentioned that in case policyholder is not satisfied with the features or the terms and conditions of the policy he can withdraw/return the policy within 15 days i.e. under the Free Look Period provision. The complainant retained the policy documents and did not raise any objection towards the policy. The complainant had not approached the answering opposite parties during the free look period with any of his grievance regarding the policy or its terms and conditions. Further, the insurance being a contract between the policy holder and the company and both are governed by the terms and conditions mentioned in the policy document and all the benefits are payable strictly as per the policy terms and conditions. 

4. On merits, it is submitted that the complainant himself willing to show his interest to purchase a Life Insurance Plan of the answering opposite party and after understanding all the terms and conditions and benefits of all plans he opted to purchase Aviva Life Long Unit Linked Plan of the answering opposite party and he also opted to pay Rs. 10,000/- as annually premium with sum assured of Rs. 1,00,000/-. Further, as per terms and conditions of the policy which are in possession of the complainant there is specifically mentioned In Unit Linked Plans, the Investment risk in investment port folio is borne by the policyholder and it is mentioned that this is a Unit Linked Insurance Policy. The actual payment of benefits in this policy will vary based on the actual performance of the investment funds chosen by the policyholder and unit price of any investment fund may increase or decrease as per the performance of the financial markets. 

5. It is further submitted that it is specifically mentioned that the policyholder has an option to reconsider the policy i.e. Free Look Period Option meaning thereby that the policyholder have the right to review the policy terms and conditions and cancel the policy within a period of 15 days from the date of receipt of the policy documents. If the policyholder cancel his/her policy the premium will be refunded after adjusting for adverse movement in unit prices less charges incurred on account of stamp duty and medical expenses but in the present case the complainant did not do so which clearly proved that he agreed for the same. The complainant is a well educated person and disclosed his qualification as an Advocate at the time of purchasing the policy. The complainant paid only three premiums against the policy and thereafter did not pay any premium so the policy of the complainant lapsed as per policy terms and conditions and after the period of revival the same terminated as per the policy provisions without any value. So, there is no deficiency in service on the part of the opposite parties. The complainant purchased the policy with his free will. The complainant has not suffered any mental tension, harassment and agony due to the act and conduct of the opposite parties rather he himself violated the terms and conditions of the policy. Further, the complainant does not fall within the definition of consumer so this Forum has no jurisdiction to entertain and try the present complaint as the investment made by the complainant was to gain profit and it was invested for commercial purpose and therefore complainant is not a consumer under the opposite parties and money of the complainant invested in the share market is no doubt a speculative gain and the speculative investment matter does not come under the Consumer Protection Act. So, the present complaint may be dismissed with costs. 

6. In order to prove his case, the complainant has tendered into evidence his own affidavit Ex.C-1, copy of policy schedule Ex.C-2, copy of first premium receipt Ex.C-3, copy of renewal premium receipt Ex.C-4, copy of renewal premium receipt Ex.C-5 and closed the evidence.        

7. To rebut the case of the complainant, the opposite parties tendered into evidence affidavit of Arindam Mishra Ex.OP-1.2/1, copy of proposal form Ex.OP-1.2/2, copy of customer declaration Ex.OP-1.2/3, copy of PAN Card Ex.OP-1.2/4, copy of adviser declaration Ex.OP-1.2/5, copy of installments deposit receipts Ex.OP-1.2/6 and Ex.OP-1.2/7, copy of cheque Ex.OP-1.2/8, copy of terms and conditions Ex.OP-1.2/9 and closed the evidence.      

8. We have heard the learned counsel for the parties and have gone through the record on the file.   

9. The point is to decide in the present complaint whether the policy is unit linked and this Forum has the jurisdiction to entertain and try the present complaint. 

10. The policy in dispute is namely Life Long-Unit Linked and the policy was purchased by the complainant from the opposite parties by paying the premium of Rs. 10,000/- yearly premium. 

11. Counsel for the opposite parties has stated that as per law laid down in 2013 (3) CPJ 203 case titled Ram Lal Aggarwala Vs Bajaj Allianz LIC held that Consumer Fora has no jurisdiction to entertain and try the complaint. Counsel for the opposite parties has also relied upon 2015 (3) CLT 411 that the claim in Unit Linked Insurance Policy, consumer complaint is not maintainable. 

12. We have taken inference from the order of Hon'ble National Commission in First Appeal No. 11731 of 2014 in appeal titled Paramjit Kaur Vs Aviva Life Insurance Company, the facts of the present complaint are almost same and that citation Ram Lal Aggarwalla Vs Bajaj Allianz Life Insurance Co. 2013 (3) CPJ 203 is also discussed and the Hon'ble National Commission held that complaint before the Consumer Fora is maintainable. The same view has been taken by the Hon'ble State Consumer Disputes Redressal Commission, Punjab in first appeal No. 3011 of 2013 decided on 7.1.2016 in case titled Reliance Company Vs Manoj Kumar and the Hon'ble State Commission has held that the policy in Unit Linked Plan, consumer complaint before the Consumer Fora is maintainable. So, we are of the considered view that the present complaint is maintainable.

13. Counsel for the opposite parties has argued that the complainant has stopped to pay the premium after paying the premium for three years and paid only Rs. 30,000/-.

14. Counsel for the complainant has argued that the complainant obtained loan from the Bank of Punjab and the Bank has got insurance of the complainant and the Bank has stated that the insurance is necessary. Counsel for the opposite parties has argued that the complainant has not made the premium after three years. So, the policy is terminated. 

15. Admittedly, the complainant has paid only three installments and paid total Rs. 30,000/-. As per IRDA guidelines, it is the duty of the insurance company that they should send the reminder to the insured that his policy is due and the same will be terminated if the premium is not paid upto date as mentioned in the letter. So, in the present complaint no letter has been ever sent by the opposite parties to the complainant regarding that the premium is due towards him and if the same is not paid the policy will be terminated and the opposite parties have also not sent any letter to the complainant that the policy has been terminated. So, in our view the opposite parties are deficient by not sending any letter/intimation regarding the due premium and termination of the policy to the complainant. Moreover, the opposite parties should have paid the surrender value to the complainant after termination of the policy. The complainant is entitled for the surrender value of the policy as per the premium paid by him. 

16. So, in view of the above discussion, the present complaint is allowed and the opposite parties are directed to pay the surrender value of the policy to the complainant from the date of termination of policy. We further directed the opposite parties to pay the interest @ 9% per annum on the surrender value of policy from the date of filing the present complaint. We further directed the opposite parties to pay Rs. 5,000/- as compensation and Rs. 5,000/- as litigation expenses to the complainant. This order shall be complied with within 30 days from the date of the receipt of the copy of this order. Copy of this order be supplied to the parties free of costs. The file be consigned to the records.

ANNOUNCED IN THE OPEN FORUM:

          16th day of March 2018

 

 

(Sukhpal Singh Gill)

President.

 

 

(Vandna Sidhu)

      Member