^{UNIONTERRITORY,CHANDIGARH}

Surinder Kumar Singal s/o Sh.Ram Parkash, R/o H.No.541, Sector 33-B, Chandigarh.

         ^Vs.

1.      

2.      

^{.…..Respondents/Opposite Parties} 

BEFORE:

Argued by:Sh.Sourabh Goel, Advocate for the appellant

Sh.R.S.Dhull, Advocate for the respondents.

PER PADMA PANDEY, MEMBER

“10.             

2.                In brief, the facts of the case, as averred by the complainant,

3.                    

4.                In their written reply,  

5.                It was further stated that, as per the terms & conditions of the Policy, if the premium payment was discontinued after 36 months, from the date of commencement then the Policy could be reinstated or could be surrendered after penalty. As per Article 15, the Policy was to remain in force for full risk cover for two consecutive years, from the due date of first unpaid regular premium, during which period it (Policy) may be reinstated. The Policy holder could reinstate the Policy subject to Article 7.4 of the terms & conditions of the same. It was further stated that if within the reinstatement period, the surrender value of units attributable to regular premium fell below a single premium amount, the Policy was to automatically terminate and the Policy holder was to be paid the surrender value. The Policy holder had a right to surrender the Policy in accordance with Article 14 and surrender value was payable to the person pursuant to which the Policy was to terminate.

6.                It was further stated that the complainant was well aware of these terms & conditions and he admittedly received the Policy document. It was further stated that the complaint was barred by limitation as the complainant availed of the benefit of the insurance Policy since March, 2007.    

7.                The complainant filed replication, wherein, the averments contained in the complaint, were reiterated and those as alleged in the written statement by the Opposite Parties were controverted.

8.                The Parties led evidence, in support of their case.

9.                After hearing the Counsel for the complainant, and, on going through the evidence and record of the case, the District Forum, disposed of the complaint, as stated above. 

10.              Feeling aggrieved, the instant appeal, has been filed by the appellant.

11.              We have heard the Counsel for the parties and have gone through the evidence and record of the case, carefully. 

12.              The Counsel for the appellant/complainant submitted that the complainant was offered a Life Insurance Plan/Policy Life Long Unit Linked plan by an agent of respondent No.1. He further submitted that the complainant was assured that the lock-in-period of the Policy was 3 continuous years while he was required to pay premium instalment for 40 years. The complainant was also made to understand that, even if no payment, was made after the period of 3 years and amount was not withdrawn, his life would be covered for a period of 40 years. He further submitted that the complainant was also assured by the agent of respondent No.1 that on regular payment of annual premium of Rs.1,00,000/-, in case of any mis-happening, the nominee of the L.A. would get a sum of Rs.12,50,000/-. He further submitted that the complainant paid regular premiums for 6 continuous years from 2007 to 2012, in all paying Rs.6,00,000/- and thereafter on enquiry, he was informed vide letter dated 27.04.2012 (Annexure C-3) that the current value of the amount deposited was Rs.5,30,556/- against the payment of Rs.6,00,000/-. He further submitted that the Policy could be surrendered by paying surrender charges, as informed by the Opposite Parties, 

13.              The Counsel for the respondents/Opposite Parties submitted that the complainant filled up the proposal form dated 20.3.2007 after duly deliberating and understanding all the terms and conditions of the Life Long Unit Linked Plan. 

14.                    The complainant paid six annual instalments @ Rs.1,00,000/- to the Opposite Parties without raising any objection, regarding the terms and conditions of the Insurance Policy, and the dispute arose only when he received letter dated 27.04.2012 from the Opposite Parties intimating him that the current value of the invested amount was to the tune of Rs.5,30,556/- against the payment of Rs.6 lacs. The Opposite Parties further informed the complainant that if he wished to surrender the Policy the same could be done by paying the surrender charges to which he did not agree on the ground that the same was not whereby he had option to get the Policy cancelled, within 15 days, from the date of receipt of Policy documents, in case the terms and conditions thereof were not acceptable to him, but he did not exercise such an option and, as such, the complainant at this stage could not be allowed to wriggle out of the terms and conditions of the Insurance Policy merely, on the ground that, the same were not mentioned in the proposal form.

15.              Article 14 of the Insurance Policy is extracted as under:-

                    in respect of Regular Premium as specified in the Schedule.

It was not the case of the complainant that the Opposite Parties was not releasing the surrender value, as per his request. The only grouse of the Counsel for the      

16.                 ^{In M/s.Suraj Mal Ram Niwas Oil Mills (P) Ltd. v.United India Insurance Co.Ltd. (SC)  held that “It is trite that in a contract of insurance, the rights and obligations are governed by the terms of the said contract. Therefore, the terms of a contract of Insurance have to be strictly construed, and no exception can be made on the ground of equity…..”} 

17.                  ^{Export Credit Guarantee Corporation of India Ltd. v. Garg Sons International, II (2013) CPJ 1 (SC)=I (2013) SLT 614, as under:-}

“It is a settled legal proposition that while construing the terms of a contract of insurance, the words used therein must be given paramount importance, and it is not open for the Court to add, delete or substitute any words. It is also well settled, that since upon issuance of an insurance policy, the insurer undertakes to indemnify the loss suffered by the insured on account of risks covered by the policy, its terms have to be strictly construed in order to determine the extent of the liability of the insurer. Therefore, the endeavour of the Court should always be to interpret the words used in the contract in the manner that will best express the intention of the parties”.

18.              Admittedly, in the instant case, the complainant paid the six annual premium of Rs.1 lac each to the Opposite Parties and, thereafter, he stopped paying the same and thereafter he filed the complaint before the District Forum.  

19.                  Since the appellant after paying 6 annual premiums did not prefer to continue with the Policy by not depositing the next premium towards the Policy nor he specifically communicated to the respondents for surrender of the Policy and instead filed the complaint before the District Forum, he is not entitled to any compensation for the alleged mental agony and harassment. 

20.                  For the reasons recorded above, the appeal is partly accepted with costs and the order of the District Forum is modified as under:-

i)         The respondents/Opposite Parties are directed to close the Policy of the appellant/complainant immediately and to pay the surrender value as was prevalent on on 18.06.2014 to him.

ii)        The appellant/complainant is also directed to submit all the requisite documents, required for surrendering the Policy, in question, to the respondents, within seven days from date of receipt of a certified copy of this order. 

iii)       The respondents/Opposite Parties shall also pay Rs.20,000/- to the complainant as costs of litigation. 

iv)       This order shall be complied with by the respondents/Opposite Parties within a period of 30 days from the date of receipt of requisite documents, as mentioned in Clause (ii) by the complainant, failing which, they shall be liable to pay aforesaid amount as mentioned in Clause (i)  alongwith interest @9% p.a. from the date of this order till its realization besides costs of litigation.

21.                  Certified Copies of this order be sent to the parties, free of charge.

22.                  The file be consigned to Record Room, after completion

Pronounced.

19.06.2014  [JUSTICE SHAM SUNDER [RETD.]

                                                                                                                       [DEV RAJ]

Sd/-

^{[PADMA PANDEY]}

^MEMBER

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