| ORDER | DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, BATHINDA (PUNJAB)
CC No. 471 of 20-09-2011 Decided on : 19-03-2012
Rama Gupta W/o Sh. Jatinder Vir Gupta S/o Sh. Raghbar Dayal, aged about 51 years, Mitwa Street, Water Works Road, Ward No. 14, Mansa. ... Complainant Versus 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. Aviva Life Insurance Co. Pvt. Ltd., Branch Office : The Mall, Near Axis Bank, Bathinda, through its Branch Manager/Incharge/Authorized Signatory HDFC Bank Ltd., (erst-while Centurion Bank of Punjab), Branch Office, Mansa, through its Branch Manager/Incharge. 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 ProtectionAct,1986 QUORUM Smt. Vikramjit Kaur Soni, President Sh. Amarjeet Paul, Member Smt. Sukhwinder Kaur, Member
For the Complainant : Sh. Ish Kumar, counsel for the complainant For the Opposite parties : Sh. Sanjay Goyal, counsel for opposite party Nos. 1 & 2. Sh. Vinod Garg, counsel for opposite party Nos. 3 & 4.
O R D E R
VIKRAMJIT KAUR SONI, PRESIDENT The instant complaint has been filed by the complainant under Section 12 of the Consumer Protection Act, 1986 as amended upto date (here-in-after referred to as 'Act'). Briefly stated the case of the complainant is that complainant and her husband Sh. Jatinder Vir Gupta, were having their joint bank account with opposite party No. 3. The officials of opposite party Nos. 3 & 4 approached the complainant and her husband in the month of August/September, 2006 for the purchase of life insurance policy of opposite party Nos. 1 & 2 and allured them that in case of purchase of life insurance policy by complainant for a sum of Rs. 6.00 lacs, the complainant has to pay one time premium of Rs. 50,000/- in lump-sum at once. The complainant shall be allotted the units of AVIVA Life Insurance Co. and the amount of Rs. 50,000/- shall be invested in equity/mutual funds/other saving scheme as per plan. The units allotted to complainant shall be known as Growth Fund under plan 'Life Long Unit Linked Fund'. The opposite party Nos. 3 & 4 also assured the complainant that their expected annual return is 25-30% and in this way, on completion of three years, complainant shall get almost double the amount. Accordingly, the complainant deposited Rs. 50,000/-through cheque with opposite party Nos. 3 & 4 and a joint receipt bearing policy No. WLG1331356 was issued vide which the complainant was allotted 1184.339 units of Balance Fund at NAV (Bid price) 27.699, for a sum of Rs. 32,805/- and also allotted 604.480 units of Growth Fund at NAV (Bid price) of 23.258 for a sum of Rs. 14,059/-, totaling Rs. 46,864/-. No policy or terms and conditions have been supplied by the opposite parties to the complainant. The husband of the complainant also purchased two policies on the same day and gave two cheques of Rs. 10,000/- each for both the policies. On receipt of first premium receipt, the complainant came to know that it was not a single premium policy, rather it was a regular and long life policy to be matured on 15-9-2044. On receipt of aforesaid receipt, the complainant approached opposite party Nos. 3 & 4 who in turn allured her that she has the option not to make further premiums and she shall be at liberty to get the amount withdrawn after 3 years with accrued profit thereof. She was allured that if she is not interested to keep the said policy, then she could get the same cancelled within Freelook period on receipt of policy, but the policy has not been received so far by her. In the month of November/December, 2007, the complainant received a telephone call from opposite party Nos. 1 & 2 to deposit the 2nd premium otherwise policy stands lapsed and first premium would be forfeited. The complainant approached opposite party Nos. 3 & 4, they also advised to deposit the 2nd premium and ultimately she deposited Rs. 50,000/- through cheque to avoid the forfeiture of first premium. Thereafter, the complainant deposited first three premiums and when she approached opposite parties for withdrawal of Rs. 1,50,000/- alongwith accrued profit, it was conveyed to her that as per amendment made by IRDA, she has to deposit atleast first five premiums failing which policy stands lapsed and amount already deposited would be forfeited. Accordingly, the complainant deposited further two premium and the last premium was paid on December, 2010 under the bonafide impression that she would get the amount of premiums with accrued profit thereof in the month of September, 2011. The complainant approached the opposite parties to get the refund of Rs. 2,50,000/- with accrued profit thereof, but they paid deaf ears and advised to deposit the due premiums on the due date for the entire policy period. The complainant alleged that since then, she has been running pillar to post to get her amount back, but to no effect. Hence, she has filed the present complaint seeking directions to the opposite parties to pay Rs. 2.50 Lacs deposited by her with its accrued profit alongwith interest, compensation and cost. The opposite party Nos. 1 & 2 filed their joint written reply and pleaded that complainant approached them for the issuance of Insurance policies. The proposal form was received by the opposite party which was duly filled and signed by the complainant after going through the 'key feature document'. On the basis of the proposal form and the declaration made thereunder, the opposite party issued a 'Life Long – Unit Linked Templated' policy bearing No. WLG 1331356 commencing from 15-09-2006. The salient feature of the policy is as under : Commencement Date 15-09-2007 Premium frequency Annual Regular Premium amount Rs. 50,000/-
Premium paid till date Rs. 2,50,000/- (5 annual premiums) Status of policy Inforce Notice Period The policy documents were despatched to the complainant which included the policy schedule, the right to reconsider notice, the standard terms and conditions, copy of proposal form and the first premium receipt. As per the 'Right to reconsider' notice the complainant had the option to get the policy cancelled within 15 days of receipt of policy documents in case she was not satisfied with any of the terms and conditions of the policy. The said policy documents were dispatched to the complainant on 18-09-2006 through Overnite Courier Service docket No. AWB512460360 and was delivered to the complainant on 20-09-2006. The complainant vide her letter dated 2-01-2008 requested the opposite party to reinstate the said policy and after receipt of renewal premium, it was reinstated on 08-01-2010. The policy was again reinstated on 21-12-2010 on receipt of renewal premium. The complainant again failed to pay renewal premium in the year 2011, hence the policy was again under 'Inforce Notice Period' on 16-10-2011. The opposite party Nos. 1 & 2 have pleaded that first premium receipt was sent alongwith policy documents which were delivered to the complainant on 29-09-2008 vide aforesaid courier docket. The complainant had not approached under freelook period i.e. 15 days from the date of receipt of policy documents. The complainant was appraised by the opposite parties again and again for the status, terms and conditions of the said policy, but she had never approached the opposite party for changes in the said policy until 28-06-2011. She had duly paid five annual premium in the said policy. The opposite party Nos. 3 & 4 filed their joint written reply and denied that their officials approached the complainant or her husband in August/September, 2006 for the purchase of life insurance policy of opposite party Nos. 1 & 2. They have denied that they have any joint business with opposite party Nos. 1 & 2 or any assurance was given by their official that she will have to pay one time premium of Rs. 50,000/- in lump sum or that she need not to deposit any more amount. The opposite party Nos. 3 & 4 have further denied that complainant deposited Rs. 50,000/- on any assurance given by them, rather she availed the policy of opposite party Nos. 1 & 2 voluntarily, of her own accord after fully understanding the terms and conditions and after signing the proposal form. The opposite party Nos. 3 & 4 have pleaded that the benefit against the policy can only be taken from opposite party Nos. 1 & 2 as per terms and conditions of the policy. Parties have led their evidence in support of their respective pleadings. Arguments heard. Record alongwith written submissions submitted by the parties perused. The learned counsel for the complainant submitted that the complainant was allured by the officials of the opposite parties that the policy in question is a single premium policy and she has to pay one time premium of Rs. 50,000/- for a sum of Rs. 6.00 Lacs. She shall be allotted units and the amount of Rs. 50,000/- would be invested in equity/mutual funds and other savings and the units allotted to the complainant would be known as Growth Fund under plan 'Life Long Unit Linked Fund'. They also allured that their expected annual return is 25-30% and in this way, on completion of three years, the complainant would get almost double the amount of Rs. 50,000/-. The complainant deposited Rs. 50,000/- through cheque with opposite party Nos. 3 & 4 and a receipt in this respect was issued to her. On receipt of first premium receipt, she came to know that it was a regular and Long Life policy and the date of last premium was 15-09-2044. The complainant approached the opposite parties and it was advised to her that she could get the policy cancelled in freelook period and freelook period shall start on receipt of policy. The learned counsel for the complainant submitted that the policy in question alongwith terms and conditions was never supplied to her. The complainant deposited 2nd installment of premium also as she received a telephonic message from the opposite parties that in case she did not do so, her first premium would be forfeited. Even thereafter, the complainant deposited third premium and when she approached the opposite parties to get the refund as per IRDA rules, it was conveyed to her that she has to deposit atleast five premiums otherwise the policy stands lapsed and the amount already deposited would be forfeited. Thus, she deposited two more premiums but when she approached the opposite parties to get the refund of Rs. 2,50,000/- with accrued profit thereof, they advised to deposit the due premiums on the due dates for the entire policy period. On the other hand, the learned counsel for opposite party No. 1 & 2 submitted that complainant had paid 5 premium i.e. Rs. 2,50,000/- till date. The complainant was duly explained about the terms and conditions and implications of the policy before filling the proposal form. The complainant after understanding the terms and conditions had applied for the said policy as no prudent man would invest in any insurance policy without understanding its terms and conditions. The policy documents were dispatched to the complainant's address on 18-09-2006 through Overnite Courier Service vide docket No. AWB 512460360 and was delivered on 20-09-2006 which included the policy schedule, right to reconsider notice, the standard terms and conditions, copy of proposal form and first premium receipt. The complainant had mentioned in her complaint that on receipt of first premium receipt, she had found that it was not a single premium rather a regular terms policy. The said first premium was also sent alongwith policy documents which were delivered to the complainant on 20-09-2006. The complainant had not approached under Freelook period. The Life Long policy is life term policy and the said policy has an insurance cover with sum assured of Rs. 6,00,000/-. It benefits not only the complainant but also legal heirs of the complainant on the occurrence of unforeseen event of the Policyholder. The learned counsel for opposite party Nos. 3 & 4 submitted that complainant never approached opposite party Nos 3 & 4 either at the time of issuance of policy or thereafter for cancellation or refund etc., or none of the official allured or approached the complainant for getting the insurance policy in question. The matter regarding the said policy relates to opposite party Nos. 1 & 2 only. A perusal of First Premium Receipt Ex. C-1 reveals that Name of branch is written as CBOP Bhatinda Branch, policy No. WLG1331356 date of commencement 15-9-2006, Plan Life Long Unit Linked Fund, sum assured Rs. 6,00,000/-, premium amount 50,000/-, next premium due date 15-09-2007 and date of last premium payment 15-09-2044. The opposite party Nos. 1 & 2 have pleaded that policy documents were sent to the complainant alongwith first premium receipt Ex. C-1, but they have produced nothing on file to prove their this version. The opposite parties have not placed on file copy of the insurance policy in question. Hence, it remained unproved on file that the opposite parties have sent policy alongwith terms and conditions to the complainant. In the absence of receipt of terms and conditions of the policy, she was unaware of the Free Look Period. When she approached opposite parties it was told to her that she can get the policy cancelled under freelook period and freelook period starts after receipt of policy document which was never supplied to her. The standard terms and conditions Ex. R-5 does not reveal that these were actually part of the policy of the complainant. The plea of opposite party Nos. 1 & 2 is that the complainant at the time of submitting the proposal form also signed a customer declaration, the relevant part is reproduced below :- “I/we fully understanding the meaning and scope of the proposal forms and the question in it and am/are submitting the complete proposal on my/our own accord and I/we confirm that I/we have not been inducted by anyone to make the proposal.” A perusal of proposal form Ex. R-3 reveals that it does not contain detailed information. Under the heading Details of the Plan applied for name of the plan has been mentioned as Life long. Sum insured Rs. 6,00,000/- and annual premium Rs. 50,000/-, cover level : minimum, Type of Fund : Unit Linked Fund, Premium Frequency – yearly, Premium as per Frequency Rs. 50,000/-. Since no policy alongwith terms and conditions were supplied to the complainant, a common man like complainant does not understand/know the insurance terms. The period of insurance is not mentioned on the proposal form whereas on the first premium receipt Ex. C-1 the last payment of premium is mentioned as 15-09-2044. Hence, such type of practice i.e. not making aware of the consumers about terms and conditions of the insurance policies, of the insurance companies keeps the consumers in dark. The pleading of the opposite party Nos. 3 & 4 is that the matter in question does not relate to them as everything has been done by opposite party Nos. 1 & 2 and benefit against the policy can be taken from them as per terms and conditions of the policy whereas the proposal form clearly depicts that on the last page at its end “Source Channel – Bankassurance” with Bank Branch code 151400 CBOP, Mansa has been mentioned. Hence, keeping in view the facts, circumstances and the evidence placed on file, this Forum is of the considered view that the version of the complainant is correct that official of opposite party Nos. 3 & 4 allured the complainant and then she purchased the said policy. The opposite party Nos. 1 & 2 before issuance of insurance policy in question neither informed her the terms and conditions of the policy nor sent her the policy alongwith terms and conditions and misguided her, resultantly, she deposited Rs. 2,50,000/- with opposite party Nos. 1 & 2 under the bonafide impression that she would receive double of the amount. As discussed above, when no terms and conditions were supplied to the complainant, the complainant is not bound by such terms and conditions. The opposite parties cannot garb the hard earned money of the consumer on such pleas. The complainant is not bound by the terms and conditions which were never supplied to the complainant. In these circumstances, the complainant is entitled as per Insurance Regulatory and Development Authority (Standardization of terms and conditions of ULIP products and treatment of lapsed policies) Regulation, 2010, which is reproduced hereunder :-
“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 term 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 ------------- ----------------------- ----------------------- Ist 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 2.50%
7th year & onward Nil Nil In view of what has been discussed above, this complaint is accepted with Rs.10,000/- as cost and compensation against all opposite parties. The opposite party Nos. 1 & 2 are directed to cancel the Insurance policy in question of the complainant with immediate effect and refund the fund value to the complainant, after deducting 5% (five percent only) amount from the deposited premium of Rs. 2,50,000/- as the policy period is more than 10 years and the complainant has already paid five premiums. Hence, the policy has completed five years and sixth year started. The amount of cost and compensation would be paid by all the opposite parties jointly and severally. The compliance of this order be made within 45 days from the date of receipt of copy of this order failing which the aforesaid fund value amount would yield interest @ 9% P.A. from the date of institution of this complaint i.e. 20-09-2011 till realization. A copy of this order be sent to the parties concerned free of cost and file be consigned for record. Pronounced 19-03-2011 (Vikramjit Kaur Soni)
President
(Amarjeet Paul) Member
(Sukhwinder Kaur ) Member | |
