D.o.F:21/02/2011
D.o.O:29/10/2011
IN THE CONSUMER DISPUTES REDRESSAL FORUM, KASARAGOD
CC.NO.41/11
Dated this, the 29th day of October 2011
PRESENT:
SRI.K.T.SIDHIQ : PRESIDENT
SMT.P.RAMADEVI : MEMBER
SMT.BEENA.K.G : MEMBER
Mrs.Sicily Thomas, W/o N.E Thomas,
R/at Thekkekattil House,
Rajapuram via, Kottody Po,Kasaragod. : Complainant
(Adv.K.E.Raghavan,Hosdurg)
Managing Director,
ICICI Prudential Life Insurance Co.Ltd,
Regd.Office at ICICI Prulife Towers, 1089, : Opposite party
Appasaheb Mavathe Marg,
Prabhadevi, Mumbai -400025.
(Adv.Tomy V.Joseph,Kalpetta)
ORDER
SRI.K.T.SIDHIQ : PRESIDENT
Complainant obtained ICICI Prudential Life Time Super pension policy in 2007 January. According to the complainant the agent of opposite party induced her to join in the policy stating that ICICI Prudential Life Time Super Pension Plan policy is one of he best policy available with them and she has to invest a lump sum amount as premium at once and after attaining maturity she can enjoy the benefit of he scheme. It was further told hat the policy term is 10 years and it provides regular pension at the time of retirement and the fund value would be used to buy an immediate annuity which would pay a regular pension. The agent of the opposite party frequently visited the complainant with a dishonest intention to induce her to subscribe the above mentioned ICICI Prudential Life Life Time Super Pension Plan policy . The agent told the complainant that the complainant has to pay `1,00,000/- as lump sum amount towards the policy and she can enjoy the benefit of he plan on the date of maturity of plan onwards. Due to the persuasion of the agent she subscribed the ICICI Prudential Life Life Time Super Pension Plan . The agent suppressed the details of application form from the complainant and obtained her signature in proposed form and paid ` 1,00,000/- with a belief that it will be beneficial for her future. Later the opposite party by a letter dated 7/2/10 has intimated that the ICICI Prudential Life Time Super Pension Plan policy which she had taken has been foreclosed with effect from 1/2/2010 and an amount of ` 27,372.56 has returned to her being the fund value of the policy. On enquiry made with the agent, he told that he does not know what was happened and asked her to wait some more time to give proper explanation. Since there was no response she sent a registered letter to opposite party to which opposite party sent a reply stating that if the full premium for the first 3 policy years is not paid and the policy is not renewed within a period of 2 years from the due date of the first unpaid premium, then the surrender value as described in clause (4) will be paid at the end of the 3rd policy year. It is also stated that the policy which the complainant taken was inactive from February 2008 for 2 years and it has been fore closed in Feb 2010 and the foreclosed fund value is ` 27372.50. This was not informed by the agent of opposite party while taking the policy. If she had known at the time of taking the policy that she has to pay the premium amount `1,00,000/- for 3 years she would not have taken the policy. The insurance agent or any other officers did not give the actual terms and conditions informed about the facts for unlawful gain. Therefore the complaint claiming the refund of `1,00,000/- with interest from the date of deposit ie 30/1/2007 and costs.
2. According to opposite party the complaint does not raise any consumer dispute and there is no deficiency in service rendered by them to the complainant. The complainant was duty bound to make the premium on due dates without any prior notice. The complainant has suppressed material and relevant facts. The contract of insurance is based on the principle of good faith. The proposer is under legal and solemn obligation to disclose all material facts correctly, honestly and truthfully to the insurer at the time of obtaining the policy, failing which the contract is rendered void. The policy is a legal contract between the policy holder and the insurer company and it is subject to the terms and conditions of policy. The policy is foreclosed in accordance with clause 10 of the policy and clause 4 deals with the surrender of the policy. As per these clauses the complainant was only entitled for ` 27372.56 as the foreclosure amount (25% of the fund value as per policy terms and condition). The policy is issued on the basis of the information and the declaration made in the proposal form to be true and correct in all aspects. The opposite party is not privy to the alleged communications between the complainant and her agent. Further the complainant did not approach the company during the free look period for return or withdraw from the policy. The complainant is not entitled for the relief claimed and complaint is liable to be dismissed.
3. Complainant ‘s husband filed proof affidavit on behalf of the complainant in support of her case . Exts.A1 to A4 marked. No oral or documentary evidence is adduced by opposite party. Both the counsels heard . Documents perused.
4. Exts.A1 is the letter dated 7/2/2010 intimating the foreclosure of policy . Ext.A2 is the photocopy of the cheque issued by the opposite party to the complainant for ` 27372.56 and Ext.A3 is the reply letter dt.6/5/2010 issued by opposite party to the complainant.
5. The complainant’s husband in the affidavit has reiterated the case of the complainant that she was induced by the agent of the opposite party to subscribe the ICICI Prudential Life Time Super Pension policy . The agent told that this policy is one of the best policies with them and she has to invest a lump sum amount as premium at one time and after attaining maturity she can enjoy the benefit of the scheme. He further induced that the policy term is 10 years and it provides regular pension at the time of retirement and the fund value would be used to buy an immediate annuity which would pay a regular pension. The agent of the opposite party frequently visited the complainant with a dishonest intention to induce her to subscribe the policy.
6. In cross examination PW1 deposed that he was with the complainant when she availed the policy and he know English and he don’t know the name of agent who canvassed the policy. He deposed that he has never read the policy document and he can not say whether the policy contains the clause of ‘free look ‘to return the policy and get back the premium. PW1 further deposed that the agent who canvassed the policy has told him that they need to pay a single term premium for the benefits mentioned in the policy.
7. From the evidence it is clear that the complainant availed the policy on the misrepresentation made by the insurance agent appointed/ engaged by the opposite party that to get pension as per ICICI Prudential Life Time Super Pension Plan he need to pay only a single premium of `1,00,000/- and the term of the policy is 10 years, in other words if the proposer makes a lump sum amount of `1,00,000/- in a single term after 10 years one can enjoy the benefits of ICICI Prudential Life Time Super Pension . PW1 further stated in the affidavit that if the complainant had known while taking the policy that she has to pay the premium amount of `1,00,000/- for 3 years, she would not have taken the policy. The agent (insurance consultant) acted on behalf of the opposite party and not on behalf of the complainant. So the signing of proposal form involved a concealed trap. The duty of disclosure is a persuasive duty and a failure or concealment involves drastic consequences. The agent (insurance consultant) is engaged to obtain a valid and enforceable contract on behalf of the insurer disclosing all the terms , conditions, riders and the risks involved in the policy. Misrepresentation makes the contract of insurance void or voidable if the misleading statement of the agent to the insured is material.
8. After the entry of private insurance companies in the insurance sector they are doing aggressive business. Earlier it was service oriented. But now a days it is purely business motivated as they are hell bent upon selling what they call ‘products’. As part of their aggressive business drive they offer ‘bonanza’ gala galore to their agents and who in turn grab the prospective policy holders by their throat by making tall promises. In most cases insurance policies contain numerous terms and conditions that normally are not disclosed to the insured. No insurance agent would explain terms and conditions those appears be adverse to the interest of the policy holder. The agent of the insurance company turns out to be a most vital factor. It is he who undertakes the insurance business on behalf of the insurer. He should make it a point to explain each and every condition or clause of the policy to the prospective policy holders which is printed in ‘small print’ of which ordinary persons would not be in a position to read between the lines. Most of the policy holders rely blindly on the assurance of the Insurance Consultant and in most cases even the literate people will not spare time to read the full text of the policy.
9. The Hon’ble Supreme Court in the case of Modern Insulators vs. The Oriental Insurance Co.Ltd reported in I (2000) CPJ 1 (SC) has held
‘ It is the fundamental principle of insurance law that utmost good faith must be observed by the contracting parties and good faith forbids either party from non-disclosure of the facts which the parties known. The insured has a duty to disclose and similarly it is the duty of the insurance company and its agent to disclose all material facts in their knowledge since obligation of good faith applies to both equally’’
10. Now the crucial question that remained unanswered by opposite party is that why did the complainant file this complaint had she been fully made aware at the time of proposing for the policy that as per the terms and condition of the policy she has to pay ` 100000/- as annual premium consecutively at least for 3 years to enjoy the benefits of the ICICI Prudential Life Time Super Pension policy?
11. Another important point to be noted that the opposite party did not adduce any evidence nor did they examine the agent (insurance consultant) who alleged to have induced the complainant. When there is an allegation of inducement and misrepresentation is made by the proposer of a policy it is the bounden duty of the opposite party to examine the agent to prove the contrary. Further the opposite party has not adduced any evidence to show that the complainant/proposer has concealed anything from the insurer which is material to the contract.
12. Therefore from the evidence let in by the complainant and also considering the facts and circumstances of the case we are of the opinion that at the time of canvassing the complainant, what is transpired between the agent and complainant as narrated by the complainant is true especially when the opposite party has a contention that they are not privy to the alleged communications between the complainant and ‘her agent’. Though the agent is appointed/ engaged by the opposite party for canvassing the policies on commission basis. The act of opposite parties amount to deficiency in service .
13. The further contention that the complainant ought to have surrendered the policy within the free look period is also not sustainable since the proposal itself was obtained by inducement and misrepresentation. A proposal which itself has no legal sanctity make the whole contract voidable at the option of the policy holder irrespective of the limited days of free look period and therefore the complainant is not bound by the terms and condition of the policy.
Relief & Costs:
The complainant has deposited the amount of `1,00,000/- on 30/1/2007 and she received `27372.56 on 2010 as the surrender value. The claim of the complainant is the refund of `1,00,000/- with interest from the date of deposit with costs. She had already received `27372.56 in 2010 . We are of the opinion that she is entitled to get the deposited amount with interest ie `100000/- less the amount already paid ie 27372.56 .
Therefore the complaint is allowed and opposite party is directed to refund `100000/- with interest @9% from 30/1/2007 to the date of deposit till payment less the amount already repaid in 2010 ie ` 27372.56 . Opposite party is also liable to pay the cost of these proceedings ie `4000/-. Time for compliance is limited to 30 days from the date of receipt of copy of the order
Exts
A1- dtd. 7/2/2010- letter intimating the foreclosure of policy .
A2 -photocopy of the cheque
A3 - dt.6/5/2010 - reply letter issued by opposite party to the complainant
A4-DT.6/8/10 -do-
PW1-N.E.Thomas-complainant’husband
MEMBER MEMBE PRESIDENT
eva
