Punjab

StateCommission

A/11/986

Jarnail Singh - Complainant(s)

Versus

Bajaj Allianz Life Insurance - Opp.Party(s)

Sandeep Bhardwaj

07 Dec 2015

ORDER

                                                               FIRST ADDITIONAL BENCH

 

STATE  CONSUMER  DISPUTES  REDRESSAL COMMISSION,  PUNJAB

          SECTOR 37-A, DAKSHIN MARG, CHANDIGARH.

                                     

                   First Appeal No.986 of 2011

 

                                                Date of Institution: 27.06.2011

                                                Date of Decision:  07.12.2015

 

Jarnail Singh son of Sh. Dharam Singh, resident of House No.100, Village Bhago Majra, Tehsil Mohali, District Mohali.

 

 

                                                                   …Appellant/Complainant              

           Versus

 

1.      The Manager, Bajaj Allianz Life Insurance Company Limited, Regd. & Head Office : GE Plaza, Airport Road, Yerwada, Pune     411006.

 

2       The Manager, Bajaj Allianz Life Insurance Company Limited, SCO 73, Phase 9, Mohali

 

3.      Ms. Neelam Ujjawal, F.P.C (Financial Planning Consultant),    c/o opposite parties no.1 and 2.

 

                                                          ..Respondents/Opposite Parties

                                                           

 

First Appeal against order dated 23.05.2011 passed by the District Consumer Disputes Redressal Forum, Mohali

Quorum:-

 

          Shri J. S. Klar, Presiding Judicial Member.

             Shri. H.S.Guram, Member

 

Present:-

 

          For the appellants                : Sh. Sandeep Bhardwaj,                                                                 Advocate

          For the respondents no.1&2         : Sh.Varun Chawla, Advocate

          For the respondent no.3       : Ex-parte.

                    . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

 

 

 

 

J.S KLAR, PRESIDING JUDICIAL MEMBER :-

         

          The appellant of this appeal (the complainant in the complaint) has filed this appeal against the respondents of this appeal (the opposite parties in the complaint), challenging order dated 23.05.2011 of District Consumer Disputes Redressal Forum Mohali, dismissing the complaint of the complainant without any order as to costs. The instant appeal has been preferred against the same by the complainant now appellant in this appeal.

2.      The complainant has filed the complaint U/s 12 of the Consumer Protection Act, 1986 (in short, "the Act") against the OPs on the averments that Ms. Neelam Ujjawal/OP no.3 Executive of OP no.1 and 2 inveigled the complainant to get double amount after three years, in case he wanted to refund of the same, he would get amount with simple bank rate of interest. It was also assured that in case, he was not satisfied with the above-said plan, he could get the refund with simple bank rate of interest. The complainant signed the proposal form in Punjabi, as he learnt it from Sarv Siksha Abhiyan  and paid an amount of Rs.1 lac towards premium being an illiterate villager. The terms and conditions of the policy were not disclosed to complainant by the OPs. The proposal form did not mention that there was any "Free Look Period" of 15 days, where under complainant could opt out of the policy. The above-said Executive never turned up to make the villagers understand about the complex terms and conditions of the policy document, knowing fully that the villagers could not understand even the simple English language and the complex policy document was beyond their understanding. After policy document was received by complainant, he was advised by his near and dears that he was to pay premium regularly in this policy. He approached the office of OPs and his oral complaint was ignored. Thereafter, the complainant made a complaint to the Insurance Ombudsman Chandigarh, but no positive response was given to him by the said office. The date of birth of the complainant is 1.1.1956 and the date of final installment is 20.06.2017, meaning thereby that the complainant has to pay the premium till the age of near about 61 years. The complainant has to pay about Rs.10,00,000/- as total premium from the commencement of the policy till the payment of final installment and the sum insured was Rs.5,00,000/- only, which was against the interest of the insured. The OP just conned the complainant being illiterate person due to their unfair trade practice. The proposal form was also filled up by the Executive of the OPs, which was not verified by any evidence. The complainant was not medically examined by the OPs and the entire proposal form was filled up in English and signature of the complainant were obtained in Punjab thereon. The complainant also served a legal notice dated 14.2.2011 to OPs for refund of amount, but to no effect. The complainant has filed the complaint against OPs for refund of the premium amount of Rs.1 lac with interest @ 18% per annum from the date of deposit till actual payment, besides compensation of Rs.50,000/- for mental harassment and Rs.11,000/- as cost of litigation.

3.       Upon notice, OPs filed written reply and contested the complaint of the complainant. It was averred in preliminary objections that complaint is barred by time. The policy in question was issued on 28.03.08 and complaint in question was filed after more than three years from the date of commencement of the policy and hence it is barred by time. The complaint filed by Gurjant Singh is pre-mature because he approached the Consumer Forum without exhausting the other remedies available under the law for redressal of his grievance. The complainant filed a complaint before Insurance Ombudsman, which is still pending. The jurisdiction of the Consumer Forum Mohali was questioned, on the ground that no cause of action accrued to the complainant within the territorial jurisdiction of District Forum Mohali. It was further pleaded that complainant has failed to discharge the contractual obligation, as stipulated in the schedule of the policy bond and failed to pay the regular yearly premiums due on 28.03.2009 and onwards. As per clause (5)(b) , if the unpaid regular premium was due during the first three policy years and the policy holder has failed to make the payment before the expiry of the aforesaid grace period, the policy holder could revive the policy within two years from the due date of first unpaid regular premium, subject always to Section 5 (d) and recovery of any due, but uncovered charges as per Section 35 and Section 36 except mortality charges, failing which policy would be terminated and the surrender value as on date of termination, as per section 6 (c) shall be paid at the end of the third policy year or at the expiry of the revival period, whichever was later. The policy was never revived by the complainant during the revival period of two years, hence the policy in question stood foreclosed and the payment of Rs.24109/- stood made to the complainant, vide no.369391 dated 08.04.2011. The complainant himself proposed for policy for a sum assured of Rs.5 lac under "Unit Grain Plus Gold" plan of the OPs for a benefit and premium paying term of 10 years, vide proposal dated 26.03.2008. The risk of the complainant, as proposed by him was accepted by the OPs and policy no.93277685 was issued for a period of 10 years. The yearly premium amount of Rs.1 lac was stipulated to be paid by the complainant every year for a period of ten years, as stipulated in the contract of insurance, but he failed to pay the regular premiums leading to lapsation of the policy w.e.f. 28.03.2009. The policy in question can be surrendered or partial withdrawal of amount under the policy in question is to be allowed after the expiry of three years from the date of commencement only, if regular premiums for three years annual premiums have been paid, but complainant had paid only one initial installment and did not pay any future premiums and hence the policy is not entitled to any surrender value or partial surrender value. The policy contained  free look period of 15 days, under which complainant could have opted out of the policy, but he has not exercised that option. Any deficiency in service was vehemently denied by the answering Ops. The complex questions of facts and law are alleged to be involved in the present case, which cannot adjudicated by the Consumer Forum in summary proceedings. The complaint was also contested even on merits on the above-referred points by the answering Ops. It was further pleaded that the Contract of Insurance is a contract of good faith particularly on the part of the life assured. The insurance policy was issued to the complainant, as per information provided by him. Moreover, by obtaining "Unit Gain Plus Gold Plan" the insured, along with life insurance cover, enjoys the investment returns, as enumerated in the policy. Rests of the averments of the complainant were controverted and OP prayed for dismissal of the complaint.

4.      The complainant tendered in evidence, his affidavit Ex.CW-1/1 along with copies of documents Ex.C-1 to Ex.C-8. As against it; OPs tendered in evidence affidavit of Sh. Rajinder Kalsi Zonal Legal Manager Bajaj Allianz Life Insurance Company Ltd Ex.RW-1/1 along with copies of the documents Ex.RW-1/1 along with copies of documents Ex.R-1 to Ex.R-2. On conclusion of evidence and arguments, the District Forum Mohali, dismissed the complaint of the complainant with no order as to cost, leaving the complainant at liberty to receive the amount of Rs.24,109/-, which is admitted by the OPs to be due to him by virtue of order of District Forum Mohali dated 23.05.2011. Dissatisfied with the order of the District Forum Mohali dated 23.05.2011, the complainant now appellant has preferred this appeal against the same.

5.      We have heard learned counsel for the parties at considerable length in this appeal and have also gone through the record of the case. The District Forum has dismissed the complaint of the complainant by giving liberty to complainant to receive the amount of Rs.24,109/- from OPs. The order passed by District Forum has been assailed in this appeal by the complainant now appellant.  We have examined the evidence on the record. The proposal form and receipt of first premium are dated 26.03.08. To determine the controversy between the parties, we have to refer to evidence on the record, Ex.C-1 is proposal form filled in by the complainant. The product name is United Linked Policy. Ex.C-2 is receipt of amount of Rs.1 lac paid towards premium to OPs by the complainant. Ex.C-3 and Ex.C-4 are the copies of complaint of the complainant to Insurance Ombudsman Chandigarh. Ex.C-5 is legal notice and Ex.C-6 is its acknowledgement. Ex.C-7 is letter dated 1st January 2008 regarding benefit illustrations for Unit Linked Products. Ex.C-8 is policy guidelines which have been issued by Insurance Regulatory Development Authority (IRDA) to the insurance company to be followed by them. In this document (Ex.C-8) the date of premium is of every year and date of commencement of risk of policy is 26.03.2008 and date of birth of insured is 01.01.1956, policy term for 10 years and sum assured is Rs.5 lac. The benefits are payable to policy holder/life assured or the spouse of the life assured or the nominee, where a valid nomination has been registered by the company in accordance with Section 39 of the Insurance Act, 1938. The policy is governed by the terms and conditions of the policy document along with the schedule. The investment risk in investment portfolio is borne by the policyholder. The policy document is on the record and it has been pointed out to our notice under Clause 3 Regular Premium, that there is no obligation on the company to issue a notice for the same. Clause 5 further lays down that if the policyholder has failed to make a payment of regular premium due by the date as specified in the schedule, the company shall give a grace period of 30 days. If the life assured's death occurs during the grace period, the full death benefit as per Section 6 (a) shall be payable. Clause 5(b)(i) further lays down that the policy shall immediately lapse for the insurance cover including the rider cover. However, during the period of lapsation, the policy shall continue to participate in the investment performance of the underlying funds, subject to deduction of all charges, as per Section 35 and 36 except mortality charge and rider premium charges, if any. It is further laid down in Clause 5 (ii) in continue of it that the policy holder may revive the policy within a revival period of two years from the due date of first unpaid regular premium subject always to Section 5 (d) and recovery of any due but unrecovered charges as per Section 35 and Section 36 except mortality charge and any rider premium charge, since  due date of first unpaid regular premium, failing which the policy shall be terminated and the surrender value as on date of termination as per Section 6(c) shall be paid at the end of the third policy year or at the expiry of the revival period, whichever is later. As per clause of surrender value, if the unpaid regular premium was due during the first three policy years and the policyholder has failed to make the payment before the expiry of the aforesaid grace period. If regular premium due during the first three policy years have not been paid, the payment of surrender value shall be subject to Section 5(b).  Here, in this case the "Unit Gain Plus Gold" is insurance cover enjoying the investment return as enumerated in the policy. The complainant has not paid the premium when became due.

6.      From perusal of documents on the record and the judgment of this Commission in First Appeal No.1087 of 2010 in case titled as Jagdev Kaur vs. Aviva Life Insurance Company and others, decided on 28.03.2014 and First Appeal No.1018 of 2011 in case titled as The Manager Bajaj Allianz Life Insurance Company and others versus Gurjant Singh and others, decided on 05.05.2014, it was submitted before us that complainant is entitled to refund of the deposited amount of premium with interest. Since complainant invested the amount in Unit Gain Plus Gold and result of the same is dependent upon market fluctuations, hence the cited authorities would not advance the case of the complainant/appellant. The Hon'ble National Commission has examined this point in Ram Lal Aggarwalla Vs Bajaj Allianz Life Insurance Company and ors, III (2013) CPJ-203 (NC), and held that the policy having been taken for investment of premium amount, policy taken for investment of the premium in the share market, which is a speculative transaction and the complainant does not come within the purview of 'consumer'. The complainant himself took this policy, as per proposal form Ex.C-1, which is Unit Gain Plus Gold, it is signed by the complainant and It cannot be said that complainant was not aware of the same. Vide Ex.C-8 investment risk in investment portfolio is to be borne by the policyholder. Consequently, we are of this view that since it is a Unit Linked Policy taken for the sake of investment and its units value depends on the fluctuation in the market, hence, complainant is not a 'consumer'.

7.      In view of our above discussion, the complainant now appellant does not fall under the definition of 'consumer' as he purchased the above-said policy for the purpose of investment. Only the competent Forum is to determine, as to how much amount the complainant is entitled as per IRDA Notification 2013. Once we have reached the conclusion that complainant is not proved to be a 'consumer' in this Unit Linked Policy, hence, we find no illegality in the order of the District Forum in dismissing the complaint of the complainant and we affirm the order of the District Forum, Mohali dated 23.05.2011.

8.      In the light of the above discussion, we do not find any merit in this appeal and same is hereby dismissed.

9.       Arguments in this appeal were heard on 03.12.2015 and the order was reserved. Copies of the order be communicated to the parties as per rules.

10.    The appeal could not be decided within the statutory period due to heavy pendency of court cases.

 

                                                                          (J. S. KLAR)

                                                          PRESIDING JUDICIAL MEMBER

                       

                                                         

                                                                           (H.S.GURAM)

                                                                              MEMBER

 

December 07,  2015                                                           

(rb)