BEFORE THE DISTRICT CONSUMER DISPUTES

REDRESSAL COMMISSION, JALANDHAR.

Complaint No.412 of 2017

Date of Instt. 01.11.2017

Date of Decision: 27.04.2021

Karmjit Kaur W/o Late. Manminder Singh resident of House No.9, Cantt.Road, Atwal Colony, Jalandhar-144001.

..........Complainant

Versus

1. Exide Life Insurance Co. Ltd. 2^nd floor, Palm Rose World Trade Centre, Jalandhar, Punjab through its Manager/Authorized Signatory.

2. Ritu Sharma Authorized Representative/Agent, Exide Life Insurance Co. Ltd. 2^nd floor, Palm Rose World Trade Centre, Jalandhar, Punjab

3. Exide Life Insurance Co. Ltd. 3^rd Floor, J. P. Techno Park, No.3/1, Millers Road, Bangluru-560001 through its Manager/Branch Manager.

….….. Opposite Parties

Complaint Under the Consumer Protection Act.

Before: Sh. Kuljit Singh (President)

Smt. Jyotsna (Member)

Present: Sh. Rakesh Dhir, Adv. Counsel for the Complainant.

Sh. Y. V. Rishi, Adv. Counsel for the OPs No.1 & 3.

OP No. 2 exparte.

Order

Kuljit Singh(President)

1. The instant complaint has been filed by the complainant, wherein alleged that the husband of the complainant was serving in Punjab Police as Senior Superintendent of Police, unfortunately died on 23.07.2016 while remained on duty at Ferozepur. That after the death of husband of the complainant, the OP No.2 who claims to be authorized representative/agent of OP No.1 and 3 approached the complainant and has stated that during his lifetime husband of the complainant have purchased one policy from the OPs No.1 and 3 through OP No.2 by paying premium of Rs.50,000/- which has been elapsed due to nonpayment of the premium and if the complainant wants to continue the same she has to pay Rs. 99,000/- or otherwise if she do not want to further continue the policy again she has to pay Rs.99,000/- and the company shall refund her a total sum of Rs.1,49,000/- otherwise the amount of Rs.50,000/- is to be forfeited. The complainant was under the shock of the sudden death of her husband and under the financial crises have asked the OP No.2 to refund the amount of Rs.50,000/- to the complainant and agreed to pay the amount of Rs.99,000/- and the complainant has also asked the OPs that the policy has been miss sold to the husband of the complainant. That in this regard, the representative of OPs came to the house of the complainant and got signed some documents and assured the complainant that the premium amount which has been deposited with the OP shall be refunded at the earliest. But after some days instead of debiting the amount of the premiums in the account of the complainant by the OPs, the complainant was surprised by seeing that another sum of Rs.99,200/- has been credited in the account of the company of OP from the account of complainant and when the complainant approached the OPs in this regard, the OP have sent one letter dated 12.09.2016 mentioning therein that the OP will not cancel the policy and refund the amount. That the insurer had disclosed all the required information to the agent as well as principal i.e. OP, the negligence or fault if any is that of the OPs and non-approval of the entire claim amounts to deficiency and negligence in service and as such, necessity arose to file the present complaint with the prayer that the complaint of the complainant may be accepted and OPs be directed to pay Rs.2,39,200/- as premium received by the OP with interest @ 18% per annum w.e.f. the date of lodging of claim till its realization and further OPs be directed to pay Rs.1,00,000/- towards in convenience mental tension, loss of work in the above complaint and further OPs be directed to pay Rs.22,000/- towards the cost of the litigation.

2. Notice of the complaint was given to the OPs, but despite service OP No.2 miserably failed to appear and ultimately, the OP No.2 was proceeded against exparte, whereas OPs No.1 & 3 appeared through its counsel and filed written statement whereby contested the complaint by taking preliminary objections that the complaint filed by the complainant is not maintainable either in law or on facts and hence on this ground itself, the complaint deserves to be dismissed in limine. It is further submitted that the complainant has no cause of action nor have any valid cause, which is evident on perusal of the complaint against the OPs No.1 & 3. Further, the complainant has failed to make out a case of deficiency in service and unfair trade practice against the OPs No.1 & 3. The complainant has not provided any valid and legal reason for which she is eligible for any relief whatsoever. It is further alleged that the complaint is based totally on presumptions and conjectures drawn by the complainant and not based on any cogent or convincing documents or opinion. The complainant has willfully made false allegations, knowing such allegations are false with the malafide intention of securing unlawful gains. It is further submitted that complainant had availed one life insurance policy from the OP No.1 and 3 and in this regard submitted duly executed proposal form dated 14.04.2016 proposing for “Exide Life Guaranteed Income Insurance Plan” which are duly approved by the Insurance Regulatory Development Authority of India a statutory body constituted by the Act of the Parliament. It is further alleged that the OPs No.1 & 3 vide reply letter dated 12.09.2016 have informed the complainant that the insurance policy was out of free look period and hence the amount cannot be refunded. As per policy terms and conditions which was entered between the parties and as agreed in contract, complainant is not eligible for any refund of the premiums nor cancellation is permissible at this juncture. However, he is eligible to surrender the policy after one year from the policy date as per the Clause 4.4.2 of the terms and conditions of the policy, which say that “If at least one full year’s premium is paid the GSV payable is 20% of premiums paid excluding the service tax and premium for extra mortality rating, if any. There is no deficiency in service on the part of answering OPs. The said policy was duly dispatched to complainant. The complainant after a gap of 6 months from the policy date has approached the OP No.1 & 2 for refund of the Insurance Policy with malafide intention. Lastly prayer has been made for the dismissal of the complaint with costs.

3. In order to prove the case of the complainant, the counsel for the complainant tendered into evidence affidavit of the complainant Ex.CA alongwith some documents Ex.C-1 to Ex.C-5 and closed the evidence.

4. In order to rebut the evidence of the complainant, the counsel for the OPs No.1 & 3 tendered into evidence affidavit as Ex.OP1 & 3/A alongwith some documents Ex.OP-1&3/1 to Ex.OP-1&3/8 and closed the evidence.

5. We have heard the arguments of learned counsel for the respective parties and also gone through the case file as well as written arguments submitted by the counsel for the OPs No.1 & 3, very minutely.

6. Learned counsel for complainant has argued that after the death of husband of the complainant, the OP No.2 who claims to be authorized representative/agent of OP No.1 and 3 approached the complainant and has stated that during his lifetime husband of the complainant have purchased one policy from the OPs No.1 and 3 through OP No.2 by paying premium of Rs.50,000/- which has been elapsed due to nonpayment of the premium and if the complainant wants to continue the same she has to pay Rs.99,000/- or otherwise if she do not want to further continue the policy again she has to pay Rs.99,000/- and the company shall refund her a total sum of Rs.1,49,000/- otherwise the amount of Rs.50,000/- is to be forfeited. The complainant was under the shock of the sudden death of her husband and under the financial crises have asked the OP No.2 to refund the amount of Rs.50,000/- to the complainant and agreed to pay the amount of Rs.99,000/- and the complainant has also asked the OPs that the policy has been mis sold to the husband of the complainant. That in this regard, the representative of OPs came to the house of the complainant and got signed some documents and assured the complainant that the premium amount which has been deposited with the OPs shall be refunded at the earliest. But after some days instead of debiting the amount of the premiums in the account of the complainant by the OPs, the complainant was surprised by seeing that another sum of Rs.99,200/- has been credited in the account of the company of OP from the account of complainant and when the complainant approached the OPs in this regard, the OPs have sent one letter dated 12.09.2016 mentioning therein that the OPs will not cancel the policy and refund the amount. On the other hand, the OPs have admitted the issuance of policy in dispute. The Ops have argued that the complainant has failed to avail free look period of 15 days for cancellation if the complainant is not satisfied with said policy.

7. On the other hand, Learned counsel for the OPs argued that policy in question was issued to complainants after the receipt of the proposal form duly signed by them and further argued that the complainant opted policies for a term of 10 years by paying an annual premium Rs. 95,532/- for policy No.03334196.

8. We are of the considered opinion that on the basis of proposal form and the declaration made there under, the OPs issued an insurance policy with the commencement dates of 21.04.2016.   On perusal of proposal forms, we find that proposal forms and declaration are signed by the complainant. The policy wherein it is clearly mentioned that your policy requires “Regular Premiums to be paid for 10 years” and further it is mentioned that 15/30 days were given under the policy in question for free look cancellation and any application for free look cancellation made after the lapse of 15/30 days shall not be entertained. The policy is also including the standard terms and conditions of the policy in question.  Meaning thereby that complainant was well aware about the fact that the policy was issued for a term of 20 years. Further, the complainant has not denied the signatures on proposal form.   By simply alleging that she deposited the said amount by his deceased husband and will not serve the desired purpose.  The documents of the OPs are unchallenged and un-shattered. 

9. Further, counsel for the complainant argued that complainant wrote letter to the OPs to refund her money but the OPs did not pay any heed to her request. We have seen the documents to this effect. It is submitted by the OPs in written statement that as per IRDA Regulation 2002, the policy terms and conditions specifically provides for a free look period of 15 days, during which period the policyholder is entitled to review the policy terms and conditions and request for a cancellation, if dissatisfied with the same.  We find that the complainant never raised any question regarding the said policy within that period. Thus the complainant cannot wriggle out of the valid contract between her and the OPs. So, the claim for the refund of the amount deposited by the complainant under the terms of the policy is unsustainable in the eyes of law.  Hence, the complainant is entitled for surrender value only.

10. However, the complainant is held entitled to surrender value as per IRDA Regulations 2013 which came into force on 18.02.2013.  Wherein, Regulation 13, obligation of an insurer upon discontinuance of a policy before lock-in-period- finds mentioned as under:-

 AP- Annualized premium

FV-Fund value

Provided that where a policy is discontinued, only discontinuance charge and Fund management charge, which shall not exceed 50 bps per annum on discontinuance fund/policy account value, as applicable, may be levied by the insurer and no other charges by whatsoever shall be levied.

Provided that no discontinuance charges shall be imposed on top ups premiums.”

11. The complainant deposited Rs.98,999.81 for policy No.03334196 as first premium of the policy. Complainant failed to deposit the regular premium afterwards, hence discontinuance of the policy occurred in the third policy year.  According to the regulation, extracted above, the Ops should pay the complainant, after deducting Rs.4,000/- only from the total deposited amount by the complainant and as such she is entitled to get Rs.94,999/- against policy in dispute. Because the complainant has failed to produce on record the receipt of other deposit payments or deducted the amount from her account as alleged. Thus, the OPs are liable to pay the complainant above said amount.   

12. Therefore, as discussed above, the present complaint is partly allowed and the OPs are directed to pay Rs. 94,999/-. Further, OPs are directed to pay compensation for mental harassment to the tune of Rs.7000/- including cost of litigation. The opposite parties are also directed to deposit Rs.2000/- as costs in the Consumer Legal Aid Account maintained by this Commission. The above said entire compliance be made by the OPs within a period of 45 days from the date of receipt of copy of this order. This complaint could not be decided within stipulated time frame due to rush of work and spread of Covid-19.

12. Copies of the order be supplied to the parties free of cost, as per Rules.

13. File be indexed and consigned to the record room after due compliance.

Announced in open Commission

27^rd of April 2021

Kuljit Singh

(President)

Jyotsna (Member)