DISTRICT CONSUMER DISPUTES REDRESSAL FORUM PALAKKAD
Dated this the 30th day of January 2013
Present : Smt.Seena H, President
: Smt. Preetha.G. Nair, Member
: Smt. Bhanumathi.A.K, Member Date of filing: 17/08/2012
(C.C.No.155/2012)
Preetha.P
47/3212/30 Suresh Bhavan,
Melamuri, Sakthi Nagar,
Palakkad - Complainant
(By Adv.C.Ramadas)
V/s
Branch Manager,
Bajaj Alianz Life Insurance Co.Ltd.
1st Floor, Mangalam Towers,
Opp.Town Bus Stand, Palakkad. - Opposite party
(By Adv.Rajesh.M)
O R D E R
By Smt.PREETHA G NAIR, MEMBER
On 31/1/2007 the agent of the opposite party approached the complainant and her father-in-law and canvassed for an insurance policy by saying that if complainant’s father-in-law remit Rs.85,000/- as consolidated amount as one time premium he will get so many attractive future benefits and good returns. The complainant and her father-in-law is being illiterate and believing the words of opposite party, father-in-law has taken a policy as per No.0037634951 by remitting Rs.85,000/- in the name of complainant. So that the complainant is the beneficiary and joint in the scheme of the policy only with the belief that she has to remit the premium only once at a time as a consolidated amount. At the time of remitting that consolidated premium amount opposite party issued a receipt to the complainant of Rs.85,000/- on 2/2/2007. Thereafter the opposite party sent a letter to the complainant on the next year to remit again premium of Rs.85,000/-. Seeing this, complainant got shocked because father-in-law of the complainant was not in a position to remit the premium in that year due to financial difficulties. So he has not remitted the amount. But the opposite party has not send any reminder letter or any further intimation letter about non payment of further premium amount or its consequences. After the death of complainant’s father-in-law, complainant enquired about the attractive future benefits and good returns as promised by the opposite party while taking the policy. At that time opposite party sent a letter to complainant saying that the policy is lapsed they are not in a position to pay any amount. Before lapsing the policy the opposite party has not intimated about the fact to the complainant. Opposite party has to give repudiation letter to the complainant before denying the policy benefits. Then the complainant sent a lawyer notice to the opposite party for the return of the premium amount with future benefit and return of amount. But the opposite party had not sent any reply so far. The act of opposite party amounts to deficiency in service and unfair trade practice. Hence the complainant prays an order directing the opposite party to pay Rs.85,000/- with interest, Rs.25,000/- as compensation for mental agony and cost of the proceedings.
Opposite party filed version stating the following contentions. At the time of taking the policy the complainant is produced the photocopy of her S.S.L.C. book, in which it is shown that father of the complainant was a teacher. The allegation of the complainant that she and her father is being illiterate is denied by the opposite party. It is true that the complainant had availed policy as per No.0037634951 under capital unit gain scheme by remitting Rs.85,000/- in the name of the complainant on 31/1/2007. At the time of the issuance of the policy all the terms and conditions of the policy, the risk coverage involved, the period of maturity and the mode of premium payment everything is made known to the complainant. In clause 5 of the proposal form the policy holder herself had selected frequency of premium payment as annual and the same clearly goes to prove contrary to the false allegations of the complainant. The opposite party informed the complainant with regard to remittance of the subsequent premiums which was accepted by the complainant that they issued a premium due letter. But the complainant did not remit the same within the period of grace as per the terms and hence the policy got lapsed.
At the time of availing the policy, the complainant was fully aware that the policy opted by her was capital unit gain policy, the maturity of the policy is 20 years and risk coverage under the policy is 8.50 lakhs and yearly premium was Rs.85,000/-. As per clause 5(b) (i) if the unpaid regular premium was due during the first three policy years and the policy holder has failed to make payment before the expiry of the grace period the policy shall immediately lapse of all insurance covers. The complainant ought to have been remitted 3 premiums to claim benefit of the policy. The complainant is a defaulter and the opposite party is informed the complainant with regard to the default even then she is not cared to continue with the policy. Then the opposite party is not responsible for lapse of policy. The complainant after accepting the proposal for the insurance policy been provided with the policy along with the terms and conditions of the policy and in which it was clearly stated in the clause 15 of the policy terms that “within 15 days from the date of receipt of the policy, you have the option to review the terms and conditions and return the policy, if you disagree to any of the terms and conditions stating the reasons for your objections. You will be entitled to refund of the premium paid, subject only to a deduction of a proportionate risk premium for the period on cover and the expenses incurred on medical examination and stamp duty charges, the schedule annexed alongwith the policy clearly states the mode of premium, the term of maturity and all the relevant particulars of the policy”. Even after receiving the policy the complainant had not raised any complaint till 10/4/2012. All the terms and conditions contained in the policy are duly approved by the insurance regulatory development authority before it is issued to the policy holders and hence the terms are legal and binding upon both the parties to insurance contract and by non compliance of policy terms by the complainant, she had opted policy to be foreclosed. The policy lapsed on 31/3/2008, and no premium was paid towards the policy thereafter.
The policies to which the complainant opted is capital unit gain size one. The particular policy is different from the traditional life insurance policies. The claim of the complainant is barred by limitation as there is no transaction between the complainant and the opposite party from 31/3/08. The policy of the insurance is long terms contract depending on the terms opted by the policy holder as such any intention to discontinue the policy abruptly at the initial stage would saddled the company with unforeseen expenditure, since the premium and charges are based on the assumptions that the policy would be kept in force for the term of the policy or till any claim is received. Any discontinuance is subject to surrender charges, morality charges and penalties, which is also duly approved by the insurance regulator. When the complainant issued a letter demanding refund of the amount of the policy, the opposite party had issued a reply dated 11/4/2012 showing all the particulars with regard to the policy. There is no deficiency of service on the part of opposite party. Hence, the opposite party prayed that the complaint may be dismissed with cost.
Both parties filed their affidavit. Ext.A1 to A4 marked on the side of the complainant. Ext.B1 marked on the side of the opposite party. Matter heard.
Issues to be considered are
1. Whether complaint is barred by limitation ?
2. Whether there is any deficiency in service on the part of opposite party ?
3. If so, what is the relief and cost ?
Issue No.1
According to the opposite party the policy was taken in the year 2007 and the complaint filed on the year 2012. So the complaint is barred by limitation. The complainant stated that at the time of paying the policy amount, believed that to remit the premium only once at a time as a consolidated amount. Further the complainant admitted that the opposite party sent a letter in the next year to remit again the premium amount of Rs.85,000/-. In Ext.A4 letter dated 11/4/2012 shows that the opposite party sent letter to the complainant stating that the policy was lapsed as on 31/3/2008 and there was no premium paid towards policy till date. No documentary evidence produced by the opposite party to show that they had informed the complainant for lapsing of policy before issuing the letter marked as Ext.A4. In K.R.Jayaramkumar Vs.National Insurance Company Ltd. and others, the Hon’ble State Commission held that in matters relating to the insurance claims, it is to be noted that the cause of action starts from the date of repudiation. So the complaint is filed within the period of limitation. Hence the 1st issue answered in favour of the complainant.
Issue No.2 & 3
We perused relevant documents on record. Admittedly the complainant had availed policy as per No.0037634951 under capital unit gain scheme by remitting Rs.85,000/- on 31/1/07. According to the opposite party at the time of issuance of the policy itself all the terms and conditions of the policy and the risks coverage it involved and the period of maturity, mode of payment everything is made known to the complainant. The complainant stated that at the time of paying the amount of Rs.85,000/- by the father-in-law of the complainant and given only the receipt marked as Ext.A1. Further the complainant stated that no other documents issued to her by the opposite party. Later opposite party produced the copy of the policy in the name of complainant, marked as Ext.B1 with subject to proof. But the opposite party has not produced evidence to prove that policy issued to the complainant. Moreover the complainant has not examined by the opposite party. Thereafter the complainant filed additional affidavit stating that the opposite party has not issued policy. Further complainant stated that the opposite party has not intimated her about the lapsing of the policy. Complainant joined in the scheme of the policy only with the belief that she has remit the premium only once at a time as a consolidated amount. No contradictory evidence produced by the opposite party.
According to the complainant she and her father-in-law are illiterate. Opposite party stated that complainant produced the copy of S.S.L.C. book at the time of joining the policy and stated her father is a teacher. According to the complainant, her father-in-law paid Rs.85,000/- and taken a policy in the name of herself. No documentary evidence produced by the opposite party to show that intimation given to the complainant before lapsing of policy. In Ext.A4 dated 11/4/2012 the opposite party sent letter to the complainant stating that the policy was lapsed as on 31/3/2008 and there was no premium paid towards policy till date. Opposite party stated that they had issued a reply showing all the particulars with regard to the policy dated 11/4/2012.
Later the opposite party filed application for production of documents by postal authorities. Application allowed and the Senior Superintendent of Post Offices issued a letter stating that records of the speed post articles are preserved for six months from the date of booking only. Since the matter date backed to 21/2/2007, the case is time barred and the proof of delivery cannot be produced at present.
So the opposite party has not produced evidence to show that the policy issued to the complainant and the policy terms and conditions are known to her.
In Ext.A1 the father-in-law of the complainant paid Rs.85,000/- on 31/1/2007 to the opposite party and taken a policy in the name of complainant. As per Ext.A4 dated 11/4/12 the opposite party stated that the policy was lapsed as on 31/3/2008 and there was no premium paid towards policy till date. . The opposite party has not issued letter to the complainant before lapsing the policy. As per clause 4 of the Insurance Regulatory and Development Authority Regulation 2010 A policy holder shall be entitled to exercise one of the following options upon the discontinuance of the policy.
(i) Revival of the policy or
(ii) Complete withdrawal from the policy without any risk cover.
As per clause 7 of the Insurance Regulatory and Development Authority Regulations 2010 maximum discontinuance charges for the policies having annualized premium above Rs.25,000/- is Rs.6,000/-. In the present case the premium amount is Rs.85,000/-. So we deducted Rs.6,000/- from Rs.85,000/-, the balance amount is Rs.79,000/-.
In the above discussions we are of the view that there is deficiency in service on the part of opposite party. In the result complaint allowed. We direct the opposite part to pay the complainant an amount of Rs.79,000/- (Rupees Seventy nine thousand only) as the balance policy amount, Rs.10,000/-(Rupees Ten thousand only) as compensation for mental agony and pay Rs.1,000/- (Rupees One thousand only) as cost of the proceedings.
Order shall be complied within one month from the date of receipt of order, failing which the complainant is entitled for 9% interest per annum for the whole amount from the date of order, till realization.
Pronounced in the open court on this the 30th day of January 2013.
Sd/-
Seena H
President
Sd/-
Preetha G Nair
Member
Sd/-
Bhanumathi.A.K.
Member
APPENDIX
Exhibits marked on the side of the complainant
Ext.A1 – Policy Copy dtd.31/01/07 issued by opposite party
Ext.A2 series – Lawyer notice 05/6/12 alongwith postal receipts.
Ext.A3 – Postal acknowledgement Card.
Ext.A4 – Registered letter sent by opposite party to the complainant dated 11/4/12
Exhibits marked on the side of the opposite party
Ext.B1 – Photocopy of Proposal Form for Life Insurance issued by Opposite party.
Cost
Rs.1,000/- allowed as cost of the proceedings.
