DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, BATHINDA

CC.No.307 of 01-08-2013

Decided on 11-12-2013

Gurbans Singh aged about 57 years S/o Hakam Singh R/o Dasmesh Nagar, Goniana Mandi, District Bathinda.

........Complainant

Versus

1.Aviva Life Insurance Company India Ltd., The Mall, Near Dr.Nagpal Hospital, Bathinda, through its Branch Manager/Branch Head.

2.Aviva Life Insurance Company India Ltd., 5^th floor, JMD Regent Square Gurgaon, Mehrauli Road, Gurgaon, through its CEO/Managing Director.

.......Opposite parties

Complaint under Section 12 of the Consumer Protection Act, 1986.

QUORUM

Smt.Vikramjit Kaur Soni, President.

Sh.Amarjeet Paul, Member.

Smt.Sukhwinder Kaur, Member.

Present:-

For the Complainant: Sh.Sunder Gupta, counsel for the complainant.

For Opposite parties: Sh.Varun Gupta, counsel for the opposite parties.

ORDER

VIKRAMJIT KAUR SONI, PRESIDENT:-

1. The complainant has filed the present complaint under section 12 of the Consumer Protection Act, 1986 as amended upto date (Here-in-after referred to as an 'Act'). The brief facts of the complaint are that on the allurement of the opposite parties, the complainant has purchased one insurance policy certificate bearing No.ALS1950393, product code ALSUIN122L053V01 and deposited the first premium of Rs.15,000/- to the opposite party No.1 on dated 1.5.2008, but no terms and conditions of the same has ever been supplied to him. The complainant has deposited the due premiums regularly as and when he has received the letter from the opposite parties to deposit the premium with regard to the abovesaid insurance policy. The complainant has deposited 4 premiums upto November, 2009, in this way he has deposited the total premiums of Rs.60,000/- upto November, 2009, but he has not received any intimation/letter for the deposit of any premium from the opposite parties thereafter, due to which he could not deposit the premium. The complainant has received Rs.8438/- vide cheque No.078559 dated 25.5.2012 drawn on Axis Bank Ltd. and got it encashed considering the same to be a bonus amount on the abovesaid policy. After that the complainant has neither received any intimation from the opposite parties nor has got any refund/premium. The complainant approached many times to the opposite party No.1, its officials conveyed him that the matter has been referred to the opposite party No.2 for the necessary action and assured him that the refund of the abovesaid policy shall be given to him within few days, but till date he has not received the refund or bonus thereupon. The complainant has also got served a legal notice dated 10.6.2013 to the opposite parties, but nothing has been done. Hence the complainant has filed the present complaint to seek the directions to the opposite parties to refund the amount of Rs.60,000/- alongwith interest, cost and compensation.

2. The opposite parties after appearing before this Forum have filed their joint written statement and pleaded that the complainant himself showed his interest to purchase their life insurance plan and approached their adviser and got the entire information about all the insurance plans. After understanding all the terms & conditions and benefits of all the plans, the complainant opted to purchase the 'Life Saver Plus Unit Linked Plan' of the opposite parties and filled the proposal form bearing No.NUP11289058 on dated 27.3.2008 and opted to pay Rs.15,000/- as premium with sum assured of Rs.3 lacs; the term of the plan 10 years; premium paying term 10 years and premium frequency half yearly and opted the type of fund as 'Unit Linked Fund', 10% in balanced fund and 90% as growth fund. The complainant has signed the proposal form after fully understanding its contents and has also signed the declaration to this effect. After receiving the proposal form and going through its entire contents, the underwriters issued the insurance policy bearing No.ALS1950393, commenced from 1.5.2008 and sent the policy documents alongwith its terms and conditions to the complainant on the given address through speed post vide Airway Bill No.EH056003087IN on dated 7.5.2008 and the same was duly received by him and is in his possession. There is a Free Look Period option wherein the policyholder has the right to review the policy terms and conditions and cancel the policy within the period of 15 days from the date of receipt of the policy documents. If the policyholder is not satisfied with his policy, he can got refunded the premium amount after adjusting for adverse movement in units prices less charges incurred on the account of the stamp duty and medical expenses, but in the present case, the complainant did not do so as he is agreed to the abovesaid policy. As per the terms and conditions, the term opted for the payment is half yearly. Apart from the first premium, no other premium amount has been paid on its time. The second premium of the regular premium was due on 1.11.2008, but the premium has been paid on 8.1.2009. The third and fourth premiums were due on 1.5.2009 and 1.11.2009 respectively, but the same has been collectively paid on 13.1.2010. The status of the abovesaid policy changed into early lapsed on 6.6.2010 due to the non-payment of the regular premium. As per the terms and conditions of the abovesaid policy the complainant has an option to revive his policy by making the payment of the entire due premium within 2 years from the date of the unpaid due date, but he failed to do so. The complainant has referred Article 2 of the standard terms and conditions of the abovesaid policy. The opposite parties have paid the surrender value to the complainant as per the terms and conditions of the abovesaid policy and he was well aware about the same and encashed the surrender amount. The complainant has duly received the surrender value cheque and got encashed the same, as such nothing is payable to him more than he received. The opposite parties further pleaded that the complainant himself violated the terms and conditions of the abovesaid policy and have taken the support of the precedent laid down by the Hon'ble National Commission in case cited as Life Insurance Corporation Vs. Smt.Siba Prasad and others, decided on 14.8.2008.

3. The parties have led their evidence in support of their respective pleadings.

4. Arguments heard. The record alongwith written submissions submitted by the parties perused.

5. Admittedly, the complainant has purchased one insurance policy certificate bearing No.ALS1950393, product code ALSUIN122L053V01 and deposited the first premium of Rs.15,000/- to the opposite party No.1 on dated 1.5.2008. The complainant has deposited 4 premiums upto November, 2009, in this way he has deposited the total premiums of Rs.60,000/- upto November, 2009. The complainant has received Rs.8438/- vide cheque No.078559 dated 25.5.2012 drawn on Axis Bank Ltd. and encashed the same.

6. The disputed facts of the parties are that the complainant submitted that no terms and conditions of the abovesaid policy has ever been supplied to him by the opposite parties. The complainant has deposited the total premiums of Rs.60,000/-. The complainant has deposited the first premium of Rs.15,000/- on dated 1.5.2008 vide Ex.OP1/4. The complainant has further deposited the premium of Rs.15,000/- on dated 8.1.2009 and Rs.30,000/- on dated 13.1.2010. The complainant has received the amount of Rs.8438/- vide Ex.C11 without any covering letter that has been encashed by him. The opposite parties have pleaded in their reply that the abovesaid policy has been cancelled and an amount of Rs.8438/- has been sent to the complainant as full and final settlement of his claim. The opposite parties have neither sent any notice regarding the cancellation of the abovesaid policy nor sent any notice regarding the deposit of any premium. The opposite parties have placed on file Ex.OP1/13 i.e. policy schedule, in which they states that it is schedule of policy alongwith its terms and conditions, but the same has not been received by the complainant. The said schedule is not signed by any party, so the same is unilateral agreement and its conditions cannot be read into the evidence. As per schedule of the abovesaid policy, Ex.OP1/13, only 10% of the premium deposited was to be invested in the share market. The opposite parties have not placed on file the account details in which the amount of the complainant was deposited, to show that which share has been purchased from the share market out of the amount deposited by him. Even after the issuance of the legal notice, the opposite parties have failed to pay the lawful claim of the complainant, as such they have caused deficiency in service.

7. On the other hand the submission of the opposite parties is that the insurance is a contract and in interpreting documents relating to a contract of the insurance, the duty of the court is to interpret the words in which the contract is expressed by the parties because it is not for the court to make a new contract, however reasonable, if the parties have not made it themselves. To support their version the opposite parties have relied upon various authorities. The opposite parties have also referred the precedent laid down by the Hon'ble National Commission in case cited as Ram Lal Aggarwalla Vs. Bajaj Allianz Life Insurance Company Ltd., decided on 23.4.2013. The complainant with his own choice, purchased the 'Life Saver Plus Unit Linked Plan' of the opposite parties and filled the proposal form bearing No.NUP11289058 on dated 27.3.2008 and opted to pay Rs.15,000/- as premium with sum assured of Rs.3 lacs; the term of the plan 10 years; premium paying term 10 years and premium frequency half yearly and opted the type of fund as 'Unit Linked Fund', 10% in balanced fund and 90% as growth fund. The complainant has signed the proposal form after fully understanding its contents and has also signed the declaration to this effect and the insurance policy bearing No.ALS1950393, commenced from 1.5.2008 has been issued to him. The opposite parties have sent the policy documents alongwith its terms and conditions to the complainant on the given address through speed post vide Airway Bill No.EH056003087IN on dated 7.5.2008 and the same was duly received by him and is in his possession. If the complainant was not satisfied with his policy, there was a Free Look Period option wherein he can review the policy terms and conditions and cancel the policy within the period of 15 days from the date of receipt of its documents, but no such efforts has been done on his part. The complainant is defaulter in paying the regular premium as the second premium of the regular premium was due on 1.11.2008, whereas the premium has been paid on 8.1.2009. The third and fourth premiums were due on 1.5.2009 and 1.11.2009 respectively, which has been collectively paid on 13.1.2010. The status of the abovesaid policy changed into early lapsed on 6.6.2010 due to the non-payment of the regular premium. As per the terms and conditions of the abovesaid policy the complainant has an option to revive his policy by making the payment of the entire due premium within 2 years from the date of unpaid due date, but he failed to do so. The complainant has referred Article 2 of the standard terms and conditions of the abovesaid policy that is reproduced hereunder:-

“Art.2 Payment of Regular Premium, Grace Period and Reinstatement and Dealings with the policy:

a)......

b) If we do not receive the regular premium due during the first three policy years from the commencement date then

i) We will allow a thirty day grace period from the due date of the first unpaid installment of regular premium. During this grace period, the benefits under Article 3 and the benefits under applicable riders, if any, will continue to apply.

ii) If regular premium due is not received within the grace period of thirty days and the due date of the first unpaid installment of regular premium is:

1).....

2) Greater than 12 months but less than or equal to 36 months from the commencement date then orders cover under article 3(a) and benefits under applicable riders, if any shall see immediately and no benefits shall be payable other than the fund value as at the date of notification of death of the insured, at which time the policy shall automatically terminate. The policyholder may reinstate the policy within two years of the due date of the first unpaid installment of regular premium subject to article 2(d). If the policy is not reinstated within the aforesaid two years period' the policy shall automatically terminate at the date of the expiry of the reinstatement period and the surrender value shall be payable. During the period from the due date of the first unpaid installment of regular premium upto the date of reinstatement, the charges as specified in the schedule, except the mortality charge and riders charges, if any, will continue to be deducted so as per the terms and conditions of the policy automatically terminate and the replying opposite party paid surrender value to the complainant.”

The opposite parties have paid the surrender value to the complainant as per the terms and conditions of the abovesaid policy and he encashed the surrender amount of Rs.8438/-.

8. The opposite parties have cancelled the abovesaid policy and refunded the amount of Rs.8438/- to the complainant, this amount has been paid by them as full and final payment, but no detail of Rs.8438/- has been given by the opposite parties to him. As per Ex.OP1/13, Schedule, the surrender value after the completion of 2 years is to be paid to the complainant as per the details of Clause 5 i.e. surrender charge on Units pertaining to regular premium, which is reproduced hereunder:-

“5) Surrender charge as Units pertaining to Regular Premium:-

According to the above mentioned Clause 5, if more than two but upto three policy years' regular premium has been paid; surrender charge as % of value of Units pertaining of regular premium:-50%, as the complainant has paid 4 half yearly premiums i.e. in total Rs.60,000/-, thus he is entitled for the refund of his amount as per Clause 5 as reproduced above, whereas the opposite parties have refunded the amount of Rs.8438/- without any explanation or detail, which amounts to deficiency in service.

9. Therefore in view of what has been discussed above this complaint is accepted with Rs.3000/- as cost and compensation against the opposite parties. The opposite parties are directed to pay the remaining amount that is to be paid to the complainant according to the Schedule mentioned above and as per Article 5(a) of Surrender Value and Auto-foreclosure and also furnish the complete details to the complainant regarding the deduction made and amount paid to him.

10. The compliance of this order be done within 45 days from the date of receipt of the copy of this order.

11. In case of non-compliance, the amount payable to the complainant minus the amount already paid to him will carry the interest @ 9% per annum till realization.

12. A copy of this order be sent to the parties concerned free of cost and file be consigned to the record room.

Pronounced in open Forum:-

11-12-2013

(Vikramjit Kaur Soni)

President

(Amarjeet Paul)

Member

(Sukhwinder Kaur)

Member