Haryana

Ambala

CC/139/2018

Usha Rani - Complainant(s)

Versus

DM LIC - Opp.Party(s)

23 Apr 2019

ORDER

 

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM AMBALA

 

 

                                                                      Complaint case no.        : 139 of 2018

                                                          Date of Institution         : 07.05.2018

                                                          Date of decision    :  23.04.2019

 

 

 Usha Rani w/o Late Sh. Ashwani Kumar R/o 31C, B-Block, Dayal Bagh Chowk, P.O. Babyal, Ambala Cantt.

    ……. Complainant.

 

Vs.

 

1. Divisional Manager, Life Insurance Corporation of India, Divisional Officer, P.O.Box. No. 106, Jeevan Prakash, 489, Model Town, Karnal.
2. Branch Manager, Life Insurance Corporation of India, Branch Office, Jeevan Sewa PB No.6, New Municipal Shopping Complex, Ambala City. .

 

 .…. Opposite Parties.

 

 

Complaint U/s 12 of the Consumer Protection Act, 1986

 

 

Before:        Ms. Neena Sandhu,  President,                                            

                   Ms. Ruby Sharma, Member,

Sh. Vinod Kumar Sharma, Member.

                  

 

Present:        Sh. Gautam Chadha, Advocate, counsel for complainant.

 Sh. Dev Batra,  Advocate, counsel for OPs.

 

 

Order:         Smt, Neena Sandhu, President

Complainant has filed this complaint under Section 12 of the Consumer Protection Act, 1986 (hereinafter referred to as ‘the Act’) against the Opposite Parties (hereinafter referred to as ‘Ops’) praying for issuance of  following directions to them:-

1. To release the amount of Rs.1,00,000/- payable under Term Assurance Benefit Rider as opted by the complainant’s husband under the aforesaid Health Insurance Policy to her alongwith interest @12% p.a. from the time it became payable till its realization.
2. To pay Rs.1,00,000/- as compensation for the mental agony and physical harassment suffered by him.
3. To pay Rs.1,00,000/-as punitive damages to be deposited in the District Legal Services Authority Cell.
4. To pay Rs. 25,000/- as litigations charges.
5.  

any other relief whichthis Hon’ble Forum may deemfit.

 

 

                   In nutshell, brief facts of the present complaint are that on 01.06.2011, the complainant’s husband, namely, Late Sh. Ashwani Kumar had taken one Health Insurance Policy in his name-“LIC’S JEEVAN AROGYA TABLE 903(UIN-512N266V01)” bearing policy no. “77557511” under the term plan “903/36” from Life Insurance Corporation of India through its insurance agent, namely, Ram Karan. The  aforesaid  insurance policy is a non-linked health plan  from Life Insurance Corporation of India, which provides  fixed benefits  for hospitalization and almost all types of surgical procedures  irrespective of actual cost incurred and the benefit  is in addition to any other health insurance cover  that insured lives may have. The benefits  under the plan are:-

1. Hospital Cash Benefit(HCB)
2. Major  Surgical Benefit (MSB)
3.  Day Care Procedure  Benefit (DCPB)
4. Other Surgical Benefit (OSB)

 

Two optional riders viz. Term Assurance Rider and Accident Benefit Rider are also  available  under this plan  for the Person Insured  and his/her Insured Spouse only. The husband of the complainant(hereinafter referred to as Deceased Life Assured i.e. DLA) duly filled up the proposal form for the aforesaid policy and had chosen Initial Daily Cash Benefit of Rs.1,000/- and had specifically opted both the optional riders viz. Term Assurance Rider worth Rs.1,00,000/- and Accident Benefit Rider worth Rs.1,00,000/-. He appointed his wife as his nominee in the said policy. He had deposited the requisite yearly premium of Rs.3,077/- from June 2011 regularly.  The payment of fifth yearly installment was due in the month of June, 2015 however the DLA expired on 15.05.2015. After his death, the complainant being nominee visited the OP No.2 for almost one year for  release of Rs 1,00,000/-. However,  when no concrete steps  were taken  by the OP No.2 then the complainant wrote  a letter dated 06.05.2016 to OP No.1 regarding release of the said amount. On 09.05.2016 the complainant received a reply stating therein that “We have sent your file in Branch Office, Ambala City for processing, you are requested to contact branch office  for the above mentioned claim”. Complainant visited the OP No.2  and it was told to her that “her claim was pending  due to technical  problem; and to rectify  this problem  alteration  is required  in computer  programming  by OP No.1 and the matter has already  been taken  up with do authorities”. On 01.08.2016, She again wrote a letter to OP No.1,for release of claim amount. After waiting for sometime, she filed an application dated 02.09.2016 under RTI seeking information from the OP No.1 to give reasons for not release of the claim amount. On 12.09.2016, she received the reply from the OP No.1 stating therein that-“Under policy no.-177557511,  the proposer at the time of proposal demanded  for term rider and accident benefit rider as per proposal form but while underwriting the proposal both the riders were not given and also premium for the riders were not charged”. On 18.01.2017, she received a letter from OP No.2 which was addressed in the name of her deceased husband (who was deceased at that time) regarding the revival of the policy which was lapsed due to non payment of annual premium due in the month of June, 2015. After receiving the said letter family members of the DLA got shocked because the death of the insured person was not updated in their system by the official of the LIC. This Act  of the OP No.2 created suspicion  in the  minds of the family members of the deceased insured person whether LIC had correctly recorded the information filled in the policy form in their online computer system/program or not. On 23.01.2017, she filed second appeal to Chief Public Information Officer, New Delhi against the order of First Appeal.  The Chief Public Information Officer vide order dated 18.09.2017 directed the OP No.1 to provide a complete self  contained response to the appellant/complainant within the period of 15 days from the date of receipt  of the order. The complainant received a registered letter dated 21.09.2017 from OP No.1, wherein it was stated that “As the life assured was not hospitalized and no surgery was performed where any benefit become payable. Further the policy does not cover life risk, hence no amount becomes payable. As per term and condition of the policy”. Being dissatisfied from the said reply, she again sent two letters dated 07.11.2017 & 06.12.2017  vide which she requested the OP No.1 to provide the original policy bond and original proposal form alongwith all other necessary documents, to enable her to pursue appropriate legal action. However, vide letter dated 21.12.20117, the OP No.1 had supplied only policy bond. On 16.03.2018 she again filed an application under RTI against the OP No.1 to supply of original proposal form. On 26.03.2018, she received the proposal form. And thereafter she has filed the present complaint against OPs for the deficiency in service committed by them. Hence, the present complaint.

2.               Upon notice, OPs appeared through counsel and tendered written version, raising preliminary objections qua complaint is not maintainable, barred by limitation. On merits, it is stated that through proposal form for policy no.177557511, Plan/Term 903/36, the proposer had applied for Term Rider & Accident Rider, but while underwriting the proposal, these riders were not given and hence premium for term rider as well as accident rider was not charged. The installment premium of Rs. 3,077/- which included only the HCB/MSB cover under the plan no.903. As the premium of alleged riders were neither calculated/claimed by the OPs and nor deposited by the insured. It is further stated that after reviewing the application and proposal forms, the OPs do issue the policy as per the terms and condition, accordingly, similar procedure was adopted in the present case. Despite demand for term rider & accident rider as per proposal form, while underwriting the proposal bond and also the premiums for the riders were not neither claimed nor ever deposited. They further stated that all processing of the claims are done by the concerned branch, but the same was settled in terms & condition of the policy. Since term assurance was not given by LIC, hence, payment was not made by the branch rightly. Thus, there is no deficiency in service on the part of the OPs and prayed for dismissal of the present complaint.

3.                To prove her version counsel for the complainant tendered affidavit as Annexure C/A along with documents as Annexure C-1 to C-18 and closed the evidence. On the other hand, Counsel for the OPs tendered affidavit as Annexure R/A alongwith documents as Annexure R-1 to R-8 and closed the evidence.

4.                We have heard both the counsel of the parties and carefully gone through the case file.

5.                The learned counsel for the complainant has argued that the deceased husband of the complainant had taken the policy in question from the OPs and had opted  for optional riders i.e. term insurance rider and accidental benefit rider worth of Rs.One Lakh each, as is evident from the proposal form, Annexure C-3. The Life Assured died on 15.05.2015. The complainant being the nominee lodged the claim with the OPs but they repudiated her claim vide letter dated 07.11.2016 on the ground that claim under policy is not payable as the premium for the term rider were not charged and the same were not given. By not paying the claim amount the OPs have committed in deficiency in service.

                    The learned counsel for Ops has argued that  no doubt the Deceased Life Assured opted for term rider benefits in the proposal form but while  under writing the proposal, both the riders were not given and also premium for the riders were not charged. Hence, claim for the term rider is not payable as per the terms and conditions of the policy.

                   From the perusal of the proposal form, Annexure R-1, it is evident that the Deceased Life Assured opted for Term Assurance Rider and Accident Benefit Rider. The plea of the OPs is that while under writing the proposal, both the riders were not given and the premium for the said riders was not charged and that is why the claim for the term rider is not payable as per the terms and conditions of the policy. The question which arises for consideration is as to whether it was incumbent upon the OPs to inform the complainant regarding not giving benefits under the riders, opted by him. Our answer is in affirmative because the insurer do issue the insurance policy to the insured on the basis of proposal form. In the present case the complainant had opted for the above referred riders in the proposal form. If the OPs were not interested to give the benefits under the said rider to the complainant then they should have given reason and should also have informed the complainant but nothing of this sort was done by the OPs. In this case DLA had opted for Term Assurance Rider worth of Rs.1,00,000/-. It is not disputed that the DLA died during the subsistence of the policy, thus the complainant being the nominee is entitled to get the benefit under the said rider. By not paying the claim amount under the said rider, the OPs have committed deficiency in service. Thus, they are liable to pay the benefits to the complainant for the Term Assurance Rider opted by the DLA in the proposal form after deducting the premium amount for the said rider. The Ops are also liable to compensate the complainant for the mental agony and physical harassment caused to him alongwith litigation expenses.

7.                In view of the aforesaid discussion we hereby allow the present complaint and direct the Ops in following manner:-

1. To pay Rs.1,00,000/- (Rupees One Lakh only) to the complainant after deducting the premium amount for the Term Assurance Rider, alongwith interest @7% per annum w.e.f. 07.11.2016 i.e. the date of repudiation of the claim till its realization.
2. To pay Rs. 5,000/- (Rupees Five thousand) as compensation.
3. To payRs.3,000/-(Rupees Three thousand)litigation expenses.

 

The Ops are further directed to comply with the order within the period of 30 days from the date of receipt of the certified copy of this order, failing which OPs shall pay interest @9% per annum on the awarded amount for the period of default. Copy of the order be sent to the parties concerned as per rules free of costs. File be indexed and consigned to the record room.

Announced on : 23.04.2019

 

 

 

      Sd/-                                Sd/-                             Sd/-

(Vinod Kumar Sharma)   (Ruby Sharma)      (Neena Sandhu)

                     Member                     Member                        President