DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, BATHINDA.
CC.No.354 of 30-07-2012
Decided on 14-12-2012
Jatinder Vir Gupta aged about 54 years s/o Sh.Raghbar Dayal, C/o M/s Gupta Telecome, Gurudwara Chowk, Mansa, r/o Mitwa Street, Water Works Road, Ward No.14, Mansa.
........Complainant
Versus
1.Aviva Life Insurance Co.Pvt. Ltd., Registered Office: 2nd Floor, Prakashdeep Building, 7 Tolstoy Marg, New Delhi-110 001 India, through its Managing Director/Chairman/G.M.
2.Aviva Life Insurance Co.Pvt. Ltd., Branch Office: The Mall, Near Axis Bank, Bathinda, through its Branch Manager/Incharge/authorized signatory.
3.HDFC Bank Ltd. (erst-while Centurion Bank of Punjab), Branch Office, Mansa, through its Manager/Incharge.
4.HDFC Bank Ltd. (erst-while Centurion Bank of Punjab), Branch: Guru Kashi Marg, Bathinda, through its Branch Manager.
.......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.Ish Kumar, counsel for complainant.
For Opposite parties: Sh.Sanjay Goyal, counsel for 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 originally, the complainant and his wife Rama Gupta, were having their joint bank account with Centurion Bank of Punjab Ltd., Bathinda and later on the said bank has opened its branch office at Mansa and accordingly, their joint bank account was got transferred to Mansa and thereafter, the said bank was merged into HDFC Bank Ltd. and now the joint bank account has been operated by the complainant and his wife with HDFC Bank Ltd., Mansa. In the month of August/September, 2006 the officials of the opposite party Nos.3 and 4 approached the complainant and his wife for the sale of the life insurance policy and allured the complainant that in case of purchase of life insurance policy by him, for a sum of Rs.2,90,000/-, he has to pay one time premium of Rs.10,000/- in lumpsum at once and he shall be allotted the units of Aviva Life Insurance Company and the amount of Rs.10,000/- shall be invested in equity/mutual funds/other saving scheme as per plan and the units allotted to him shall be known as 'Growth Fund' and further allured him and his wife that the life of the complainant shall be insured for a sum of Rs.2,90,000/- till the withdrawal of the amount by him or return/refund of the amount by the opposite parties to him and also allured them that he has to pay the amount of Rs.10,000/- only at once and thereafter, he/she has not required to deposit any more amount with them. The opposite party Nos.3 and 4 also assured the complainant that their expected annual return is 25-30% and on the completion of three years, the complainant shall get almost double the amount of Rs.10,000/- i.e. Rs.20,000/- approximately (NAV of the unit allotted to the complainant at the time of withdrawal/refund of the amount). There is no maturity date of the said policy. On the allurement of the opposite party Nos.3 and 4 the complainant has deposited Rs.10,000/- through cheque with the opposite party Nos.3 and 4 , and a joint receipt (bearing names of both Aviva & CBOP) was issued and a policy bearing No.WLG1334380 dated 15.9.2006 has been issued by the opposite parties to him whereby it revealed that he was allotted 199.456 units of Balance Fund at NAV (Bid price) 27.699, for a sum of Rs.5525/- and also allotted 158.311 units of Growth Fund at NAV (Bid price) of 23.258 for a sum of Rs.3682/- and the totaling Rs.9207/-. The opposite party Nos.3 and 4 have not issued the policy or terms and conditions to the complainant. Thereafter the complainant has applied for another policy by depositing Rs.10,000/- more and his wife also purchased one policy on the same day in her own name under the same impression, but his wife was also not issued the policy or its terms and conditions. On the receipt of the first premium receipt, the complainant came to know that it was not a single premium policy and rather it was a regular policy and there was/is no maturity date and the date of the last premium payment was shown as 15.9.2041 and on the receipt of the same, he approached the opposite party Nos.3 and 4, who in turn allured him that he has the option not to make further premiums and he can withdraw the amount after 3 years with accrued profit thereof and if he is not interested to keep the said policy, then he can avail the option of Free Look Period and can get the same cancelled on the receipt of the said policy. The complainant further told them that he has not received the said policy so far, then the officials of the opposite party Nos.3 and 4 allured him that he need not to worry as the free look period shall start on the receipt of the said policy. Thereafter, the complainant has received a telephonic call from the opposite party Nos.1 and 2 for depositing the second premium on or before 31.1.2008 failing which the said policy stands lapsed and her first premium shall be forfeited and then he again approached the officials of the opposite party Nos.3 and 4 and apprised them about the same and then they also advised him to deposit the second premium and on asking about the said policy and free look period, their officials further advised to contact with the opposite party Nos.1 and 2 and under the compelled circumstances he has deposited Rs.10,000/- through cheque to avoid the forfeiture of the first premium and thereafter, he has deposited first three premiums and on the completion of three years, when he approached the opposite parties for the withdrawal of Rs.30,000/-, he was conveyed that as per amendment made by IRDA, he has to deposit atleast first 5 premiums failing which, the said policy would lapse and the amount already deposited shall stand forfeited and he left with no option except to deposit further two premiums under the bonafide impression that he will get the amount of the premiums with accrued profit thereof in the month of September, 2011. The complainant had paid first two premiums of Rs.10,000/- per annum each and remaining three premiums of Rs.10,500/- per annum each and in total he had paid the amount of Rs.51,500/-. The complainant requested the opposite parties to refund the amount of Rs.51,500/- with accrued profit but nothing has been done till date. Hence the complainant has filed the present complaint to seek the directions to the opposite parties to refund the amount of Rs.51,500/- alongwith interest, cost and compensation.
2. Notice was sent to the opposite parties. The opposite party Nos.1 and 2 after appearing before this Forum have filed their separate joint written statement and pleaded that they have never assured the complainant to pay the premium only once and no assurance was given regarding 25% to 30% return. The last date of premium is 2041. The opposite party No.1 and 2 further pleaded that based on the declaration made and information provided in the Proposal Form, the policy bearing No.WLG1334380 was issued to the complainant having the date of commencement mentioned as 15.9.2006. The policy documents were dispatched to the mailing address of the complainant through Overnite Courier AWB No.512460818 and the same was delivered on 19.9.2006 and the same was received by him. It was clearly mentioned in the said policy schedule that the said policy is a Life Long Unit Linked policy and the date of the last premium payment is 2041. The said policy also contained a notice of Free Look option whereby the policyholder has a right to reconsider his decision to purchase the policy within 15 days from the date of receipt of the Policy Document in case he does not agree to the terms & conditions of the said policy. The complainant was well aware that he has to pay the premium till 2041. After the expiry of the Free Look Period, as per the policy terms & conditions the surrender value is payable after the completion of 3 years. The complainant has availed a Life Insurance Cover from the opposite parties and enjoyed coverage for more than 3 years, he cannot be permitted at this belated stage to claim the refund of the premiums paid contrary to the terms & conditions of their respective policies. The complainant is entitled to the surrender value under the said policies on account of the risk bore by the opposite parties associated with the policy for three years. The opposite party Nos.1 and 2 further pleaded that after duly deliberating on the terms & conditions of the 'Life Long Unit Linked' plan vide the Key Feature Document, Jatinder Vir Gupta, the complainant in the present matter filled and signed the Proposal Form bearing No.NUP10433410 dated 19.8.2006 for a proposed premium amount to Rs.10,000/- which has to be paid annually and the sum assured was Rs.3,04,500/-. All the documents were duly sent to the complainant. The Key Features Document of 'Life Long' policy makes it clear that 'Policy Term' will continue till the said policyholder attains the age of 85 years and accordingly, the term of the said policy will be determined. Thus in the Life Long policy, Proposer having different age group applying for the policy will have different terms of the policy, for example a proposer aged about 50 years applying the Life Long policy needs to continue with the policy for 35 years. Thus the proposer filling the proposal form is not required to write term of the said policy which is according to the age of the proposer. The complainant had paid Rs.51,000/- in the said policy but the premiums were not paid by him in time. The said policy was due for the premium for the year 2011 and the complainant has failed to deposit the same in time therefore as per the terms and conditions of the said policy, it lapsed due to non payment as the regular premium that was due for the year 2011, he was informed through various premium reminder notices but he has failed to deposit the regular premium as such the status of the said policy was changed. A policy gets inforce notice period on 15.10.2011. Notice period takes place when the premium discontinues after 36 months after the date of coverage. The policyholder has an option to provide advance notice whether he wants to continue his policy without paying further premium. The other option which a policyholder can avail during the inforce notice period are that he can either get the said policy reinstated or he can surrender the said policy as per the terms and conditions. As per Article 12 of the terms & conditions of the said policy, the premium could be indexed and the policyholder has the right to decline to increase the regular premium in writing by the company not later than 5 years before the anniversary. In the present case, the complainant has paid the increased premium and acceded the request of the opposite parties for the indexation in the said policy. On the legal side the opposite party Nos.1 and 2 pleaded that this Forum has no territorial jurisdiction to try and decide the present complaint as alleged payment was made by the complainant at Mansa as such all the formalities regarding purchasing of the insurance policy were also made at Mansa and Bathinda Branch has no concern with any of the activities of Mansa Branch as such the present complaint is not maintainable at Bathinda.
3. The opposite party Nos.3 and 4 after appearing before this Forum have filed their separate written statement and have taken the same legal objection. Any premium of Aviva Life Insurance can be deposited with HDFC Bank Branch. The complainant has purchased the said policy with his free will and there was no allurement by the opposite party Nos.3 and 4. The opposite party Nos.3 and 4 pleaded that neither the insurance premium was payable to them nor the claim can be settled by them and dispute is relating to the refund of the premium paid by the complainant as such the dispute is between him and the Insurance company to decide whether his claim is genuine or not as such the present complaint qua them is not maintainable. The complainant came to know that the said policy is payable till 2041 and knowing the same he again started paying the premium to the opposite party Nos.1 and 2.
4. The parties have led their evidence in support of their respective pleadings.
5. Arguments heard. The record alongwith written submissions submitted by the parties perused.
6. The complainant has purchased the insurance policy on the assurance of the opposite party Nos.3 and 4, he was conveyed by them that he has to pay one time premium of Rs.10,000/- in lumpsum and on their allurement he has deposited Rs.10,000/- through cheque with them and accordingly the policy bearing No.WLG1334380 dated 15.9.2006 has been issued by the opposite parties to him whereby it was revealed that he was allotted 199.456 units of Balance Fund at NAV (Bid price) 27.699, for a sum of Rs.5525/- and also allotted 158.311 units of Growth Fund at NAV (Bid price) of 23.258 for a sum of Rs.3682/- and the total amount was Rs.9207/-, but no policy or terms and conditions has been issued to him. At the time of issuance of the said policy the opposite party Nos.3 and 4 assured the complainant that their expected annual return is 25-30% and on the completion of three years, he shall get almost double the amount of Rs.10,000/- i.e. Rs.20,000/- approximately (NAV of the unit allotted to the complainant at the time of withdrawal/refund of the amount), but no maturity date of the said policy was mentioned. The complainant has applied for another policy by depositing Rs.10,000/- more and his wife also purchased one policy on the same day in her own name under the same impression, but his wife was also not issued the policy so far. On the receipt of the first premium receipt, the complainant came to know that it was not a single premium policy rather it was a regular policy and there was/is no maturity date and the date of the last premium payment was shown as 15.9.2041. On approaching the opposite party Nos.3 and 4 they asked them to deposit further premiums and he shall be at liberty to get the amount withdrawn after 3 years with accrued profit and if he is not interested to keep the said policy, then he can avail the option of Free Look Period and get the same cancelled on the receipt of the same. The complainant submitted that he conveyed the officials of the opposite party Nos.3 and 4 that free look period has not received by him but he was told by them not to worry about the same. On November/December 2007, the complainant has received a telephonic call from the opposite party Nos.1 and 2 for depositing the second premium on or before 31.1.2008 failing which the said policy stands lapsed and her first premium shall be forfeited. The complainant approached the officials of the opposite party Nos.3 and 4 and they also advised him to deposit the second premium, under the compelled circumstances he has deposited Rs.10,000/- through cheque to avoid the forfeiture of the first premium as such he has deposited first three premiums and on the completion of three years, he approached the opposite parties for the withdrawal of Rs.30,000/- but he was again conveyed by them that he should deposit atleast first 5 premiums failing which his policy will lapse and the amount already deposited shall stand forfeited. Again under the bonafide impression the complainant has deposited first two premiums of Rs.10,000/- per annum each and remaining three premiums of Rs.10,500/- per annum.
7. The submissions of the opposite party Nos.1 and 2 are that the said policy issued by them was not a single premium policy rather the last date of premium is 2041. The opposite party Nos.1 and 2 never assured the complainant that he will get the return of 25% to 30% in case of surrender of the said policy. Based on the declaration made and information provided in the Proposal Form, the policy bearing No.WLG1334380 was issued to the complainant having the date of commencement mentioned as 15.9.2006. The said policy documents were dispatched to the mailing address of the complainant through Overnite Courier AWB No.512460818 and the same was delivered on 19.9.2006 and the same was received by him. In the policy schedule it has specifically been mentioned that the said policy is a Life Long Unit Linked policy and the date of the last premium payment is 2041. The said policy also contained a notice on Free Look whereby the policyholder has a right to reconsider his decision to purchase the policy within 15 days from the date of receipt of the Policy Document in case he does not agree to the terms & conditions of the said policy. The complainant was well aware of the fact that he has to pay the premium till 2041. On the legal side the submissions of the opposite parties are that this complaint is not maintainable as this Forum has no territorial jurisdiction to try and decide the present complaint as alleged payment was made by the complainant at Mansa as such all the formalities have been done at Mansa. The opposite party Nos.1 and 2 further submitted that on 28.6.2011 the opposite parties had received a complaint through e-mail from the complainant that was replied vide letter dated 29.6.2011 stating the reason for its inability for any changes in the said policy. As per Article 12 of the terms & conditions of the said policy, the premium could be indexed and the policyholder has the right to decline to increase the regular premium in writing by the company not later than 5 years before the anniversary. The complainant has paid the increased premium and acceded the request of the opposite parties for the indexation in the said policy. In case the policyholder did not avail the free look period, he can surrender his policy after the completion of 3 years. The complainant had paid Rs.51,000/- in the said policy but the premiums were not paid by him in time as such due to the non payment of the premiums in time as per the terms and conditions of the said policy, it lapsed due to non payment. To support their version the opposite party Nos.1 and 2 have given the reference of various authorities.
8. The submissions of the opposite party Nos.3 and 4 are that this Forum has no jurisdiction to try and entertain the present complaint as all the formalities have been done at Mansa and the said policy has also been issued from Mansa. The complainant was well aware of the fact that the said policy was payable till 2041 and after knowing the same he again started paying the premium to the opposite party Nos.1 and 2. Any premium of Aviva Life Insurance can be deposited with HDFC Bank Branch. The complainant has purchased the said policy with his free will and there was no allurement by the opposite party Nos.3 and 4.
9. The opposite parties on the legal side has argued that this Forum has no jurisdiction to try and entertain the present complaint as the said policy was obtained from Mansa and all the formalities have been completed at Mansa.
A perusal of Ex.C2 shows that the premium has been paid at Bathinda on 8.9.2008 for the amount of Rs.10,500/- and this receipt is duly stamped by the Bathinda office. Hence the objection of the opposite parties is not tenable as part of cause of action arose at Bathinda.
10. The opposite party Nos.1 and 2 submitted that the policy documents were dispatched to the mailing address of the complainant through Overnite Courier AWB No.512460818 as there is no affidavit of any courier person. The courier does not deliver the letter unless or until on his behalf signed the same. Such like evidence can be created at anytime. There is no clear cut proof of service of the said policy upon the complainant, there should be signatures on the receipt in lieu of the delivery of the letter. The support can be sought by the precedent laid down by the National Consumer Disputes Redressal Commission in case titled OIC Vs. Charandas in Revision Petition No.123 of 2012, Order Pronounced on 1 August, 2012.
The complainant had paid 5 premiums of Rs.51,000/- under bonafide belief but on his request no surrender value has been paid to him. The complainant has not received the terms and conditions of the said policy hence these are not binding on him.As per precedent laid down by the Hon'ble State Commission, Punjab in case titled O.I.C. Vs. M/s Puneet Pasricha, FAO No.1579 of 2004, decided on 05.03.2010 that
“The terms and conditions are nowhere signed by the Insured nor it is proved that this was made a part of Insurance Policy. If the terms and conditions had been explained to insured at the time of insurance cover, these could have been given to them at the same time or at least these could have been got signed from them. Therefore, the oral version of the appellants that these terms and conditions were duly explained to the insured cannot be believed.”
Further, it has been held that the appellants can not be permitted to frustrate the insurance claim on the technicalities.
11. As discussed above, when no terms and conditions were either supplied or communicated to the complainant, he is not bound by such terms and conditions. The opposite parties cannot garb the hard earned money of the consumer on false pleas/pretexts. In these circumstances, the complainant is entitled to get the refund as per the Insurance Regulatory and Development Authority (IRDA) which are applicable on all the insurance policies. The deduction under the Surrender Charges of IRDA (Insurance Regulatory and Development Authority) (Standardization of terms and conditions of ULIP products and treatment of lapsed policies) Regulations, 2010 can be done as under:-
“10.......The proceeds of the lapsed policies shall invariably be refunded to the policyholder after the expiry of the revival period or at any time after completion of 3 years terms as and when demanded by the policyholder. In case, there is no demand from the policyholder for refund, insurance company shall refund the amount on its own by means of a cheque/demand draft to be delivered to the insured/nominee at his last known address. However, Insurer may deduct charges on account of pre-closure and lapsation which should, in any case, not exceed the charges stated in regulation 8 above.
Regulation No.8 i.e. Surrender Charges of Insurance Regulatory and Development Authority (Standardization of terms and conditions of ULIP Products and treatment of lapsed policies) Regulations, 2010, is reproduced hereunder:-
“It is observed that insurers apply different surrender charges while paying the surrender value to the Insured. After due consideration of various practices, the Authority orders that the surrender charges (as percentage of fund value) shall not exceed the limits specified below:-
Year Policy Period
Less than 10 years More than 10 years
---------- ----------------------- ---------------------
1st Year 12.50% 15%
2nd year 10.00% 12.50%
3rd year 7.50% 10%
4th year 5.00% 7.50%
5th Year 2.50% 5%
6th year Nil 250%
7 year & onward Nil Nil.”
12. In the present case, the complainant has paid 2 premiums of Rs.10,000/- per year and 3 premiums of Rs.10,500/- each. As such the complainant paid the total amount of Rs.51,000/-. As the policy in question is in the 6th year and the policy term is more than 10 years as such the deductions to be done on the total amount. As per abovementioned IRDA table in regulation No.8 the amount of 2.5% is to be deducted from Rs.51,000/-.
13. Therefore in view of what has been discussed above, this complaint is accepted against the opposite parties with Rs.5000/- as cost and compensation and the opposite parties are directed to pay the amount of Rs.51,000/- after deducting 2.5%=Rs.49,725/-(Rs.51,000-Rs.1275/-). The compliance of this order be done within 45 days from the date of receipt of the copy of this order.
In case of non-compliance the interest @ 9% per annum will yield on the amount of Rs.49,725/-.
14. With utmost regard and humility to the authorities relied upon by the learned counsel for the opposite parties have distinguishable facts and circumstances.
15. 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:-
14-12-2012
Vikramjit Kaur Soni
President
Amarjeet Paul
Member
Sukhwinder Kaur
Member
