Mrs.Shalini Patrick,W/o Late John Patrick, Miss Sheena Patrick, D/o Late Mr.John Patrick, Master Arwin Patrick,S/o Late John Patrick,
...........Appellant(s)
Vs.
ICICI Homes Finance Co.Ltd., ICICI Lombard General Insurance Co. Ltd,,
...........Respondent(s)
BEFORE:
Complainant(s)/Appellant(s):
OppositeParty/Respondent(s):
OppositeParty/Respondent(s):
OppositeParty/Respondent(s):
ORDER
Date of Filing:14.08.2007 Date of Order: 31.03.2008 BEFORE THE II ADDITIONAL DISTRICT CONSUMER DISPUTES REDRESSAL FORUM SESHADRIPURAM BANGALORE-20 Dated: 31ST DAY OF MARCH 2008 PRESENT Sri. S.S. NAGARALE, B.A, LL.B. (SPL.), President. Smt. D. LEELAVATHI, M.A.LL.B, Member. Sri. BALAKRISHNA. V. MASALI, B.A, LL.B. (SPL.), Member. COMPLAINT NO: 1715 OF 2007 1. Mrs.Shalini Patrick W/o Late John Patrick. 2. Mrs. Sheena Patrick D/o Late John Patrick, Age: 13 years. 3. Master Arwin Patrick S/o Late John Patrick, Age: 8 years. Complainant No.1 & 2 represented by their mother & natural guardian Mrs. Shalini Patrick, W/o Late John Patrick. All R/at E 102, Deja View Homes, Nagavarapalya, C.V. Raman Nagar, Bangalore-560 093. Complainants V/S 1. ICICI Homes Finance Company Limited, having its Branch office at Unit No.101 & 102, I Floor, ACR Towers, No.32, Residency Road, Bangalore-560 025. 2. ICICI Lombard General Insurance Company Ltd., having its Branch office at 62/1, Prestige Corniche, Richmond Road, Bangalore-560 025. Opposite Parties ORDER By the President Sri. S.S. Nagarale This is a complaint filed U/Sec.12 of the Consumer Protection Act, 1986. The facts of the case are that, the husband of complainant No.1 Late John Patrick had availed loan of Rs.10,00,000/- from the opposite party No.1 for the purchase of residential flat during the month of December-2000. At the time of availing the loan, the opposite party No.1 had agreed to provide Free Personal Accident Insurance to the first applicant Mr. John Patrick to the extent of outstanding principal of loan. Copy of the loan sanction letter dated 30th December-2007 and loan agreements are produced. Thereafter, the opposite party No.1 disbursed the loan amount in installments under its cover letters dated 30th November-2000, 23rd January-2001 and 27th July-2001. There was no policy certificate was provided by the opposite party No.1 even after the final disbursement of the loan amount. When the opposite party No.1 enquired confirmed that the first applicant was covered under the free personal accident insurance policy with opposite party No.2. On 15th November-2006 the husband of complainant No.1 while returning to Bangalore along with his six other friends in Toyota Innova Car bearing No. KA-03 ME 9738 after attending a party at about 7.00 a.m near the milestone marked Mangalore 322 K.M, the left side near wheel of the car got detached and as a result, the car turtle and hit the near by tree, which resulted in his death. It is submitted that, in view of the death of Mr. John Patrick the complainants were entitled under the policy for a claim to the extent of principal outstanding towards the loan with the opposite party No.1. Accordingly, on 19th November-2006 the complainant No.1 lodged an oral claim in accordance with the practice of the opposite party No.2 and the said claim was registered as HFC/0000421. Thereafter, the complainant received a communication dated 1st January-2007 from the opposite party No.2 requesting certain documents for processing the claim. The complainant furnished the documents required by the opposite party No.2. After repeated requests and reminders, the complainant received a communication dated 20/6/2007 rejecting the claim of the complainant stating that the deceased was provided with the Free Accident Insurance Benefit and not with Free Accidental Death Insurance Benefit. The opposite parties have failed to provide Insurance Policy to the deceased or complainants cannot contend that the complainants are not eligible for the benefits under the said policy. It is submitted that, deceased was covered under the contract of insurance with the opposite party No.2 to the extent of outstanding principal of the loan borrowed from the opposite party No.1 and hence the complainants are entitled to a sum of Rs.9,17,625/- being the outstanding principal of loan as on 21/3/2007 as evident from statement issued by the ICICI Bank with interest. The opposite party No.1 was responsible for providing the policy to the deceased/complainant No.1 is now making desperate efforts to recover the money from the complainant unlawfully. Hence, the complaint. 2. Notice was issued to opposite parties. Opposite parties put in appearance through their advocates and filed defense version. In version the opposite party No.1 stating that the husband of complainant No.1 had availed a loan facility from opposite party No.1. Accordingly, an execution of agreement in favour of the opposite party No.1 for a sum of Rs.10,00,000/- came to be disbursed by the opposite party. At no point of time, the opposite party No.1 had agreed to extend the Free Personal Accident Cover to the said Mr. John Patrick. It is further submitted that, the opposite party had never and ever collected any premiums for the so called personal accident insurance cover, or promised to extend Free Personal Accident Cover. The opposite party had not offered any insurance policy and not issued any insurance certificate. The offer was made to the deceased Mr. John Patrick, the opposite party No.1 could have set off the outstanding amount against the insured amount. Hence, the opposite party No.1 pleased to dismiss the complaint. 3. The opposite party No.2 filed version stating that nowhere the complainants have stated about the source from which they collected the alleged policy number. It is pertinent to note from the very admission that the opposite party No.1 did not provide them a policy certificate. At no point of time, the opposite party No.2 has issued any policy much less the alleged policy No.4005A/0000536 to the complainant. It is submitted that, once the claim form was submitted without mentioning the policy number, in the process of verifying the documents and the claim form, the opposite party No.2 has found that no policy was issued by them to the deceased. It is submitted that when the opposite party No.2 had not issued any PA insurance policy to cover the risk of husband of complainant No.1, the contentions that the rejection of the claim by the opposite party No.2 is contrary to the terms and conditions does not arise for consideration. Hence, the opposite party No.2 prayed to dismiss the complaint. 4. Affidavit evidence of complainant and opposite party No.1 filed. Arguments heard. 5. The points for consideration are:- 1. Whether the outstanding loan amount in respect of deceased Mr. John Patrick is liable to be given set off by the opposite parties? 2. Whether the complainants are entitled for the waiver of outstanding principal amount? REASONS 6. The complainant No.1 is the widow of deceased Mr. John Patrick and complainants No.2 and 3 are the children of deceased. It is an admitted fact that during December-2000 Mr. John Patrick and his wife Shalini Patrick jointly availed loan of Rs.10,00,000/- from the opposite party No.1 for purchase of residential flat. The loan was covered with free personal accident insurance to the first applicant i.e., John Patrick. It is an admitted fact that, John Patrick died in Motor vehicle accident on 15/11/2006. The complainants have produced FIR, the copy of complaint given to the police and death certificate of John Patrick is also produced. The opposite parties have not disputed the fact of John Patrick had died in motor vehicle accident. It is the case of the complainants that, in view of the death of Mr. John Patrick in a motor vehicle accident they are entitled under the policy of insurance, the benefit of set off of the loan to the extent of principle outstanding. Complainant No.1 lodged claim and her claim was registered. She was asked to submit certain documents for processing the claim and the complainant furnished documents required by the opposite party No.2. After repeated requests and reminders the complainant received a communication dated 20/6/2007 rejecting the claim. The rejection of the claim of the complainant by the opposite party is absolutely unjustified and it is against the policy conditions. The complainant has produced letter of opposite party Bank dated 27/7/2001 wherein it has been clearly stated as under:- Further we are pleased to inform that with the final disbursement of this loan, a very personal accident insurance cover to the first applicant of this loan to the extent of principle amount, is extended as per the applicable conditions. The complainants have produced a letter dated 1st January-2007 sent by ICICI Lombard General Insurance. This letter clearly goes to show that the insurance claim under P.A Policy No.4005A/0000536 and name of loan applicant John Patrick, the loan account number is also given and claim number is shown as HFC/0000421. It is better quote the entire letter of claims operation manager. ICICI LOMBARD -General Insurance MUM/CLM/MLX/24617 January 1, 2007 Shallini Patrick No.201, Rahat Residency, Vathur Road Cross, C.V. Raman Nagar Bangalore-560093 Ph: 9945350267 Dear Customer, Insurance Claim under PA Policy No.4005A/0000536 Name of Loan Applicant: John Patrick Loan account Number: LHBNG00000100040 Claim No.: HFC/0000421 We deeply regret the loss to you & extent our sympathy to your family members for the said incident occurred, we acknowledge the intimation of the aforementioned claim and in this regard we would request you to submit the following documents to enable us to examine the admissibility of the claim: 1. Duly filled PA claim form. 2. Photocopy of HFC loan disbursement letter. 3. F.I.R: Notarised copy. (Translated in English) 4. Panchanama: Notarised Copy. (Translated in English) 5. Post Mortem Report: Notarised Copy. (Translated in English) 6. Death Certificate: Notarised Copy. (Translated in English) Looking forward to serve you in future. Sincerely, Sd/- Claims Operation Manager Encl: PA Claim form The complainants have produced the terms and conditions of take a home loan and get personal accident insurance absolutely FREE. As per this terms and conditions also it has been stated that a sum not exceeding the capital sum insured (outstanding principal of loan). If the insured persons sustains death, resulting solely and directly from accident. The capital sum insured will be paid if the death of the insured person is within a period of 12 months from date of bodily injury. Benefit table is 100% of principal outstanding. Therefore by all the documents produced by the complainants it is clearly established that the loan sanctioned to the deceased John Patrick was covered with insurance and unfortunately he died in motor vehicle accident. Therefore, upon the happening of the event it is the duty and obligation of the opposite parties to give benefit of 100% principal outstanding. In the affidavit of Mr. Manjunath the authorized signatory of opposite party No.1 stated in his affidavit that they could have set off all the outstanding amount against the insured amount, but in the instant case, the complainants are demanding the said amount for them and this complaint is not maintainable. The only objection taken by the opposite parties is that, the complainants are demanding payment of principal amount of Rs.9,17,625/-. The prayer made by the complainants may be some what not properly worded. But the fact remains that the complainants are entitled to benefit of insurance coverage to the loan. As per the terms and conditions of policy, the opposite parties are bound to give set off, the outstanding principal amount against the insured amount. The opposite parties should have accepted the claim and given set off of the outstanding loan amount since the loan had been covered with insurance. It is unfortunate that the opposite parties being a reputed financial institution have taken untenable and unjustified defence. There is absolutely no merit in the objections taken by the opposite parties. The opposite parties should have accepted the claim of the complainant and given the benefit of the insurance after getting the necessary documents. The complainant had submitted all the necessary documents as per the request made by the claim operation manager. But in spite of submission of all the documents the opposite parties did not honour the claim and taken a very flimsy and untenable objection. This kind of attitude or objections on the part of the opposite party is not proper. This type of objection will tarnish good name of the opposite parties. The complainants are entitled for the waiver of the loan amount as on the date of death of John Patrick since the loan was covered with insurance. Though the complainants are not entitled to get the amount of Rs.9,07,625/- from the opposite parties but they are entitled for the set off of the outstanding loan amount to the sum insured under policy. The loan is covered with a free personal accident insurance of the deceased to an extent of principal amount. Therefore, as on the date of death of John Patrick the principal amount of outstanding loan is liable to be given set off towards the loan account of the complainant No.1 and her deceased husband. In the result, I proceed to pass the following:- ORDER 7. The complaint is allowed. The opposite parties are directed to give set off to the outstanding loan amount against the insured amount as on the date of death of John Patrick. The opposite parties shall have to waive or write off the entire principal amount on the date of death of Mr. John Patrick. The complainants are entitled to Rs.5,000/- towards costs of the present proceedings from the opposite parties. 8. Send the copy of this Order to both the parties free of costs immediately. 9. Pronounced in the Open Forum on this 31ST DAY OF MARCH 2008. Order accordingly PRESIDENT We concur the above findings. MEMBER MEMBER
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