DISTRICT CONSUMER DISPUTES REDRESSAL FORUM: NORTH-EAST

GOVT. OF NCT OF DELHI

D.C. OFFICE COMPLEX, BUNKAR VIHAR, NAND NAGRI, DELHI-93

Complaint Case No. 224/16

In the matter of:

N.K. Sharma, President

Ms. Sonica Mehrotra, Member

Ravindra Shankar Nagar, Member

Order passed by Ms. Sonica Mehrotra, Member

ORDER

1. The grievance of the complainant succinctly put in the present complaint is that he was enticed to purchase a policy of OP through an executive of M/s Centurion Bank of Punjab where he was maintaining his savings account. The financial advisor M/s Sheetal Goyal, at the time of selling of the policy to the complainant informed him that the value of the policy would be Rs. 1,80,000/- but the complainant shall have to pay premium of Rs. 20,000/- for three consecutive years for which he shall enjoy life time risk cover. Thereafter, a proposal number NVP-11086644 and policy no.                WLG-1700521 dated 18.09.2007 was purchased by the complainant on insistence by the bank officials and was made to sign on blank performa printed in English which he cannot read or understand. The complainant earnestly paid Rs. 20,000/- towards the premium for the policy for the next three years till 2010 under the impression that he was being covered for life risk. However, on 18.09.2013, the complainant was informed by the OP vide letter dated the same day that the policy contract was a long term contract and does not mature within three years as the proposal form clearly states that the proposal is for a “Life Insurance Contract”. The complainant immediately contacted the senior official of OP after the said letter caused anxiety and asked for refund of Rs. 60,000/- alongwith interest but to no avail. Even the legal notice issued by the complainant to the OP dated 19.10.2013 was not replied to. Therefore, the complainant alleging connivance and conspiracy and deficiency of service and unfair trade practice on the part of OP in failure to provide service and forfeiting the premium amount was constrained to file present complaint before this Forum praying for issuance of directions against the OP to release the sum of Rs. 60,000/- i.e. the amount deposited by the complainant with the OP towards three premiums paid for the policy year 2007 – 2008, 2008 – 2009 and 2009- 2010 alongwith interest @ 24 % p.a. till realization, Rs. 30,000/- towards mental agony and suffering and cost of litigation.

The complainant has annexed copy of the policy number                      WLG- 1700521 dated 28.09.2007, copy of policy schedule showing commencement date 27.09.2007, sum assured 1,80,000/-, premium amount Rs. 20,000/- with annual frequency with last date of premium as 27.09.2035 (i.e. 22 years premium tenure), copy of illustration of benefits for policy, permanent disability rider, age vise annual mortality charge, copy of renewal premium receipt for 27.09.2008 dated 23.10.2008 for a sum of Rs. 20,000/- paid by complainant to OP, copy of letter dated 04.11.2009 from OP to complainant informing complainant of non receipt of renewal premium against the life ling policy for the period 2009- 2010 resulting in lapse of policy and asking the complainant to reinstate his policy by paying the outstanding premium at the nearest OP branch, copy of letter dated 16.09.2013 from complainant to OP for refund of Rs. 60,000/-, copy of letter dated 18.09.2013 from OP to the complainant informing the complainant of auto foreclosure of policy, bank statement of the complainant for October 2010 highlighting payment of Rs. 20,000/- made by way of cheque to OP towards premium for 2009-2010 policy period and copy of unsigned legal notice dated 19.10.2013.

2. Notice was issued to the OP which did not appear despite service effected on 22.11.2016 and was therefore proceeded against ex-parte vide order dated 18.01.2017.
3. Ex- parte evidence by way of affidavit and written arguments were filed by the complainant.

4.  We have heard the arguments forwarded by the complainant and perused the documentary evidence placed on record.
   From the policy documents, it is clearly established that the commencement of the policy / risk coverage was w.e.f 27.09.2007 and therefore the cycle of the policy renewal was from September of the ensuing year 2008. The complainant paid Rs. 20,000/- at the time of taking the policy cover in September 2007 and at the time of first renewal in October 2008 for the policy period 2008-2009. However, for the policy period 2009-2010, the complainant failed to pay Rs. 20,000/- within the prescribed time frame of September-October 2009 for which the OP had issued a letter dated 04.11.2009 apprising the complainant of lapse of policy and had given him an option of reinstating the same to avoid any partial or full forfeiture of his fund value within two years of the due date of September 2009 by paying the outstanding premium and competing the reinstatement formalities. However, the complainant instead vide letter dated 16.09.2013 to OP ask for the refund of entire sum of Rs. 60,000/- as against refund of Rs. 20,000/- which the OP had verbally informed him of being reimbursed. The OP vide letter dated 18.09.2013 in response of the aforementioned letter of the complainant brought to his attention that as per the policy documents, the policy contract was a long term contract and does not mature within three years. Further OP informed the complainant that all customers are provided with a “your right to reconsider” option (Free look period), wherein the customer if dissatisfied with the policy terms and conditions or the benefits available under it, is entitled, to bring it to the notice of the Company and request for cancellation of the policy within 15 days of receipt of the policy. However, the OP did not receive any intimation from the complainant’s end highlighting concerns in the policy during this period. The OP further stated in the said letter that for the policies inforce : Notice Period or Inforce: Premium Discontinue or inforce: Revival period) the policy status will changed to Auto – Fore Closure ‘ status under following conditions:

                       a          if Surrender value falls below First Year Premium (base plan).

                                  Or

                       b          Revival period is competed from paid to date.

On change of policy stated to auto – foreclosure, an auto- foreclosure event will be passed in system and surrender value will be paid to the customer. The OP had informed the complainant that his policy was auto foreclosed and refund cheque was dispatched at his correspondence address but was returned undelivered. The OP had asked the complainant for current address proof and expressed regret that no changes or full refund would be possible with respect to the existing policy of the complainant.

5. Further on perusal of the documents filed by the complainant specifically the HDFC Bank Account statement for October 2010, it is clearly established that the complainant deposited the premium cheque for the policy period 2009-2010 in October 2010 i.e. after one year of delay from the schedule date of payment. Therefore, the complainant cannot be allowed to take advantage of his own act of omission and the letters dated 04.11.2009 and 18.09.2013 issued by OP to the complainant which have been filed by complainant himself highlight the errors on the part of the complainant in non- payment of premium, failure to get the policy reinstated or availing of ‘free look period’ for cancellation of policy within 15 days of receipt of policy. The Hon’ble Delhi SCDRC in recent judgment of Surender Kumar Vs SBI Life Insurance Co. Ltd I (2018) CPJ 2B (CN) (Del) had dealt with the similar case of appellant dissatisfied with terms and conditions of policy and asking for refund of premium and not availing ‘free look facility’. The Hon’ble State Commission had observed that the complainant after receiving policy documents, waited from eleven months to complain about the terms and condition therein and did not exercise his free look option for cancellation and had dismissed the appeal.
6. In the present case also the policy was taken by the complainant in September 2007 however asked for cancellation of the same vide letter dated 16.09.2013 i.e. after six years at a much belated stage and in any case the OP had issued a cheque of refund as part of premium to the complainant vide letter dated 18.09.2013 which got returned. In this scenario of complainant having failed to avail of cancellation option of policy within the free look period, we are of the considered opinion in the light of settled law in catena of judgments that the present complaint is devoid of merits and the same is dismissed with no order as to costs. 
7. Let a copy of this order be sent to each party free of cost as per regulation 21 of the Consumer Protection Regulations, 2005.
8.   File be consigned to record room.
9.   Announced on 24.07.2018