DISTRICT CONSUMER DISPUTES REDRESSAL FORUM-II

U.T. CHANDIGARH

(1)

Harbans Singh son of Sh. Karnail Singh r/o village Rohno Khurd, Tehsil Khanna, District Ludhiana, Punjab.

                                      ---Complainant.

Versus

1.                 Bajaj Allianz Life Insurance Company Limited, Regd. & Head Office : GE Plaza, Airport Road, Yerwada, Pune 411006 through its Manager/authorised representative.

2.                 Bajaj Allianz Life Insurance Company Limited, SCO 215-217, 4^th Floor, Sector 34-A, Chandigarh.

3.                 Bajaj Allianz Life Insurance Company Limited, SCO 215-217, 4^th Floor, Sector 34-A, Chandigarh through agent Rafi Mohd.

4.                 Bajaj Allianz Life Insurance Company Limited, SCO 215-217, 4^th Floor, Sector 34-A, Chandigarh through agent Jasmit Singh.

---Opposite Parties.

BEFORE:  SMT. MADHU MUTNEJA, PRESIDING MEMBER

                   SHRI JASWINDER SINGH SIDHU, MEMBER

Argued by:  Sh. Sandeep Bhardwaj, Counsel for the complainant

                        Sh. Varun Chawla, Counsel for OPs No.1 & 2.

                        OPs No.3 & 4 exparte.

(2)

Harbans Singh son of Sh. Karnail Singh r/o village Rohno Khurd, Tehsil Khanna, District Ludhiana, Punjab.

                                      ---Complainant.

Versus

1.                 Bajaj Allianz Life Insurance Company Limited, Regd. & Head Office : GE Plaza, Airport Road, Yerwada, Pune 411006 through its Manager/authorised representative.

2.                 Bajaj Allianz Life Insurance Company Limited, SCO 215-217, 4^th Floor, Sector 34-A, Chandigarh.

3.                 Bajaj Allianz Life Insurance Company Limited, SCO 215-217, 4^th Floor, Sector 34-A, Chandigarh through agent Rafi Mohd (deleted vide order dated 23.10.2012)

4.                 Bajaj Allianz Life Insurance Company Limited, SCO 215-217, 4^th Floor, Sector 34-A, Chandigarh through agent Jasmit Singh (deleted vide order dated 23.10.2012).

---Opposite Parties.

BEFORE:  SMT. MADHU MUTNEJA, PRESIDING MEMBER

                   SHRI JASWINDER SINGH SIDHU, MEMBER

Argued by:  Sh. Sandeep Bhardwaj, Counsel for the complainant

                        Sh. Varun Chawla, Counsel for OPs No.1 & 2.

                        OPs No.3 & 4 deleted vide order dated 23.10.2012

PER JASWINDER SINGH SIDHU, MEMBER.

1.                           By this order we propose to dispose of the above mentioned two consumer complaints in which common questions of law and fact are involved.

2.                           The facts may be gathered from consumer complaint No.112 of 2012-Harbans Singh Vs. Bajaj Allianz Life Insurance Co. Ltd. & Ors.

3.                           In brief, the case of the complainant is that on the assurances given by the agents of the opposite parties, he invested a sum of Rs.1,85,000/-.  The complainant was assured that the amount would be invested in a fixed deposit and after one year he was to get Rs.5,00,000/-.  However, after one year when the complainant approached the opposite parties, for getting the maturity value, he was told that a policy, having term of 20 years, has been issued to him.  According to the complainant, the policy has been issued to him totally in violation of the guidelines issued by the Insurance Regulatory and Development Authority (IRDA) and the act of the opposite parties amounts to deficiency in service and unfair trade practice.  Hence this complaint.

4.                           In their joint written statement opposite parties No.1 & 2 at the outset pleaded that this Forum does not have the territorial jurisdiction and no cause of action has arisen to the complainant.  The issuance of the policy in question has been admitted.  However, it has been denied that any promise was made to make payment after one year of policy.  It has been averred that the policy was issued in the year 2010 as per the information/details submitted by Miss Beant Kaur in the proposal form and the original policy bond, containing the terms and conditions, was admitted to be received by the complainant.  It has further been averred that if the complainant or his daughter were not satisfied with the policy issued, they had the option to return the same within the 15 days freelook period, but they failed to do so.  It has been pleaded that the complainant and his daughter were fully aware of the nature of the unit linked policies.  According to the opposite parties, earlier also the complainant had purchased two unit linked policies and upon surrender request of the complainant, the amount due was expeditiously credited to his account.  It has been pleaded that the policy in question lapsed due to non payment of premiums but she could get the same revived as per terms and conditions of revival.  Pleading that there is no deficiency in service on their part, prayer for dismissal of the complaint has been made.

5.                           Opposite parties No.3 & 4 did not appear despite due service, hence they were proceeded against exparte vide order dated 20.4.2012.

6.                           In the second consumer complaint (No.149 of 2012), vide order dated 23.10.2012, the names of opposite parties No.3 & 4 were ordered to be deleted from the array of parties in view of the statement given by the ld. Counsel for the complainant.

7.                           We have heard the learned counsel for the contesting parties and have gone through the documents on record.

8.                           The complainant had subscribed for two policies by paying premium amount of Rs.1,85,000/- each from the opposite parties on 28.8.2010.  In these two policies, subscribed by the complainant, in one, his son Gurpreet Singh was the life assured whereas in the second policy his daughter namely Beant Kaur was the life assured.  The complainant at the time of filling up the proposals of these policies was promised by the agent that he would get an amount of Rs.5,00,000/- at the end of one year.  Believing such features of the policy, the complainant signed the proposals and handed over two different cheques of Rs.1,85,000/- each to the agent of the opposite parties. The opposite parties have admitted to have received these two proposals and on the basis of these proposals issued two different policies to the complainant bearing No.0025851350 and 0025845737 respectively.  However, other allegations about having been ill advised and mis-selling of the policies on false promises are denied. 

9.                           The opposite parties have taken a preliminary objection with regard to the territorial jurisdiction of this Forum as the complainant, being resident of District Ludhiana, maintaining his bank account at Mohali through which the payment of premium was made and further the opposite parties itself having mentioned the servicing branch of the policies as its Sangrur office, have prayed for the dismissal of the present complaint on this ground alone.  We have perused both the proposal forms and having come across a stamp mentioning BALIC-Chandigarh hub where the policies were received and processed by the opposite parties clears all doubts about the territorial jurisdiction of this Forum.  Hence, the objection of the opposite parties on this score is outrightly rejected.

10.                       The complainant has mentioned that he had only subscribed for a single year policy, as he was pressed with an instant need of money for his daughter’s wedding but, at the same time, the contents of the proposal form, mention that the policies were subscribed for a period of 20 years each.  However, the intentions of the complainant about a single year policy are abundantly clear from the fact that he had demanded his money after the completion of his first premium year and had also expressed his desire to not to continue these policies any further and had also not deposited the second premium amount that was due towards him.  The opposite parties in their reply have stood their ground that the complainant has himself failed to pay the premium and he was bound by the contract to continue the policy for 20 years he had subscribed for. 

11.                       Complainant having disclosed his intentions about not continuing the said policies is clear from his communications as well as the legal notice served upon the opposite parties to which they have failed to respond. 

12.                       Though the complainant, having genuinely put forward his grievances with the opposite parties, but they on their part having failed to redress the same in a befitting manner, have definitely caused harassment to him. 

13.                       The complainant while knocking at the door of this Forum has demanded the refund of investments due towards him and even the prayer clause of the present complaints point towards this fact. It is not disputed that these two polices, at this point of time, are in a state of discontinued mode and, in such circumstances, the complainant is definitely entitled to the refund of his premium amount of the policies, which he has discontinued to service, as per clause 7 of Insurance Regulatory and Development Authority (Treatment of Discontinued Linked Insurance Policies) Regulations, 2010 which is reproduced as under :-

“Obligations of an insurer upon discontinuance of a policy

7.         The obligations of the insurer in this regard shall be as follows:-

i.          To impose discontinuance charges only to recoup expenses incurred towards procurement, administration of the policy and  incidental thereto.

ii.         To design the discontinuance charges to encourage the policyholder to continue with the contract for the full term;

iii.       To ensure that the discontinuance charges reflect the actual expenses incurred.

iv.        To structure the discontinuance charges within the statutory ceilings on commissions and expenses and

v.                  To ensure that the charges levied on the date of discontinuance (as a percentage of one annualized premium) do not exceed the limits specified below:-

 AP - Annualised premium

FV- fund value on the date of discontinuance

Provided that where a policy is discontinued, only discontinuance charge may be levied by the insurer, and no other charges by whatsoever name called shall be levied.

Provided that no discontinuance charges shall be imposed on single premium policies and on top ups.”

Thus, from the perusal of Regulation 7, extracted above, it is crystal clear that the opposite Parties, should have, at the most, deducted an amount of Rs.6,000/- each from both these policies and refunded the remaining amount to the complainant, on their own, even during the pendency of the present complaint.  However, they have miserably failed to do so.  In such circumstances, the act of the opposite parties in not offering this option to the complainant, and even while defending these two complaints have also not come up with such solution, so that this Forum could have been lenient towards them, proves that the opposite parties are deficient in rendering proper service to the complainant.  Therefore, in the given situation, the present complaints deserve to succeed and the same are allowed against opposite parties No.1 & 2 only.

14.                       In view of the above discussion, the present complaint is allowed and the opposite parties No.1 & 2 are directed as under :-

                                           i.            To pay the amount of Rs.185000 – Rs.6000 = Rs.1,79,000/- as per Regulation 7, extracted above;

                                         ii.            To pay Rs.15,000/- as compensation for mental agony and harassment.

                                      iii.            To pay Rs.5,000/- as cost of litigation;

15.                       This order be complied with by the opposite parties No. 1 & 2, within 45 days from the date of receipt of its certified copy, failing which the amounts at Sr.No.(i) &(ii) shall carry interest @18% per annum from the date of this order till actual payment besides payment of litigation costs.

16.                       Similar directions are passed in the connected consumer complaint No.149 of 2012.

17.                       Certified copy of this order be communicated to the parties, free of charge. After compliance file be consigned to record room.

Announced

17.05.2013.

Sd/-

 (MADHU MUTNEJA)

PRESIDING MEMBER

Sd/-

(JASWINDER SINGH SIDHU)

MEMBER