Delhi

West Delhi

CC/13/596

Mrs. Nishu Jain D/o Shri R.L. Jain - Complainant(s)

Versus

Induslnd Bank - Opp.Party(s)

01 Apr 2017

ORDER

    CONSUMER DISPUTES REDRESSAL FORUM (WEST)

                                        GOVERNMENT OF NCT OF DELHI

  150-151, Community Centre, C-Block, JanakPuri, New Delhi – 110058

 

                                                                                                        Date of institution:25.09.2013

Complaint Case. No.596/13                                                          Date of order:01.04.2017

IN  MATTER OF

Mrs. Nishu Jain D/o Shri R.L. Jain, B-3/177 Janakpuri, New Delhi-110058.                                                                                                                                                                         Complainant

VERSUS

1.        Induslnd Bank, B-1 Community Centre, Janakpuri, New Delhi-110058.                                                                                                                               Opposite party No.1

2.        Aviva Life Ins. Co. India Ltd., Aviva Tower, Sector Road, Opp. Golf Course, DLF V, Sector-43, Gurgaon, Haryana-122003.                                    Opposite party No.2

ORDER

R.S. BAGRI,PRESIDENT

Smt. Nishu Jain here in the complainant has filed the present consumer complaint under Section 12 of the Consumer Protection Act against Aviva Life Insurance Company India Ltd. and another hereinafter referred as the opposite parties with averments that the complainant’s father Shri R.L. Jain had account  with the opposite party no.1. The opposite party no.1 and its officers act as agents of the opposite party no.2. Ms. Kusum and Shri Pawan Bhasin, Officers of the opposite party no.1, persuaded/ insisted the complainant’s father to take single premium policy in complainant’s name of the opposite party no.2 .

That on continuous persuasion and assurances of the officers of the opposite party no.1 the complainant’s father took policy no.NLS3051840 dated 06.12.10 in complainant’s name from the opposite party no.2 and deposited Rs.1,25,000/- on 06.12.10. The opposite party no.2 in July, 2012 informed the complainant that the policy has lapsed and suggested her to renew the policy. The complainant’s father sent representations to the opposite party no.2 informing that it is single premium policy and she is not interested in continuation of the policy and requested to refund the deposited amount with interest. The opposite party no.2 refused to refund the deposited amount with interest vide letter dated 23.07.12.

That the complainant’s father made representations to the opposite parties but the opposite party no.2 refused to refund the deposited amount. The complainant’s father was assured by the employees of the opposite party no.1 that it was a single premium policy with maturity after five years with 15% return. It is alleged by the complainant that the policy was forced upon the complainant and her father by the officers of the opposite party no.1 ignoring the principles of utmost good faith of insurance contract. This is short of misselling of the insurance policy and unfair trade practice by the opposite parties. Hence, the present complaint for directions to the opposite parties to refund the deposited amount with interest @15% per annum and to pay compensation of Rs.25,000/-  for loss and damages suffered by her on  account of misrepresentation, deficiency in service and unfair trade practice.

After notice the opposite parties appeared and filed reply while contesting the complaint and raising preliminary objections that the complaint is false, malicious, malafide and abuse of process of law. The complaint is not maintainable on the facts and law and is without cause of action. The complaint is based on conjectures and surmises and the complainant has concealed correct and material facts. There is no unfair trade practice and deficiency in service on the part of the opposite parties no.1 and 2 and prayed for dismissal of the complaint. 

On merits the opposite party no.2 asserted that the complaint submitted proposal form no.NUP14058662 dated 30.11.10 after going through key feature documents. The complainant was issued policy no.NLS3051840 dated 06.12.10 for 15 years. The complainant also signed a benefit illustration form clearly explaining policy and premium terms for fifteen years. It is further asserted that all benefits and returns under the policy are in accordance with policy terms and conditions. The complainant has purchased Aviva Life Saver Advantage and is a unit linked policy for fifteen years. The complainant’s father has been inquiring about returns of the policy from the opposite party no.2. The complainant’s father was explained that the rates are assumed returns and no guarantee. The complainant opted for withdrawal of the policy. The complainant’s father paid first premium which clearly mention the next date of premium to be paid. The complainant has violated terms and conditions of the policy and they have rightly not refunded the deposited amount with interest as per the terms and conditions of the policy. All other allegations of the complaint are vehemently denied by the opposite party no.2 and once again prayed for dismissal  of the complaint. 

The opposite party no.1 also filed reply while denying all the allegations of the complainant and prayed for dismissal of the complaint.

The complainant filed rejoinder to the replies of the opposite parties no.1 & 2 while controverting stand of the opposite parties no.1 & 2 and reiterating her stand.

When Smt. Nishu Jain – the complainant  was asked to lead evidence, she tendered her affidavit dated 06.03.14 narrating facts of the complaint. The complainant in support of her version also relied  upon Annexure-1 copy of first premium receipt dated 06.12.10, Annexure-2 copy of letter by the opposite party to reinstate lapse policy, Anneures-3 to 6 copy of letters dated 05.07.12, 23.07.12, 30.07.12, 30.07.13 and 09.08.12 and Annexures-7 and 8 copy of newspaper advertisements.

When the opposite parties were asked to lead evidence, the opposite party  no.1 tendered in evidence affidavit of Shri Rajesh Mahajan, Operation Head. He reiterated their stand taken in their reply and controverted the stand taken by the complainant. The opposite party no.2 tendered in evidence affidavit of Shri Vivek Yadav, Constituted Attorney. They have also relied upon copy of policy documents, copy of right to reconsider, copy of terms and conditions of the policy, copy of schedule of payment of premiums and rate of return and welcome letter dated 08.01.14 and copy of replies and representations etc.

All the parties have also submitted written arguments in support of their respective contentions.

We have heard Shri R.L. Srivastava, advocate for complainant, Shri Roshan Lal Goel, advocate for the opposite party no.1 and  Ms. Charu Sachdeva, advocate for the opposite party no.2 and have gone through the material on record carefully and thoroughly.

From the complaint, replies to the complaint, rejoinder to the replies of the opposite parties, affidavits of the parties, documents relied upon by all the parties and written submissions filed by the parties it is common case of the parties that the complainant submitted proposal form no. NUP14058662 dated 02.12.10 and on the basis of the proposal form the opposite party no.2 issued unit linked policy no. NLS3051840 dated 06.12.10 in her favour. The complainant paid premium amount of Rs.1,25,000/- and sum assured was Rs.19,68,750/-. The first premium receipt mentions the next due date of premium 06.12.11 and date of last premium payment 06.12.2024. The opposite party no.2 provided right to reconsider option to the complainant informing her right to accept or cancel the insurance policy. The complainant did not exercise her right of cancellation of the policy in stipulated period as provided under Regulation-4 of Insurance Regulatory and Development Authority (Protection of policy holders interest) Regulation 2002 hereinafter in short referred as the IRADA Regulations. Which reads as under:-

Proposal for Insurance

1. Except in cases of a marine insurance cover, where current market practices do not insist on a written proposal form, in all case, a proposal for grant of a cover, either for life business or for general business, must be evidenced by a written document. It is the duty of an insurer to furnish to the insured free of charge, within 30 days of the acceptance of a proposal, a copy   of the proposal form.
2. Forms and documents used in the grant of cover may, depending upon the circumstances of each case, be made available in languages recognized under the Constitution of India.
3. In filling the form of proposal, the prospect is to be guided by the provisions of Section 45 of the Act. Any proposal form seeking information for grant of life cover may prominently state therein the requirements of Section 45 of the Act.
4. Where a proposal form is not used, the insurer shall record the information obtained orally or in writing, and confirm it within a period of 15 days thereof  with the proposer and incorporate the information in its cover note or policy. The onus of proof shall rest with the insurer in respect of any information not so recorded, where the insurer claims that the proposer suppressed any material information or provided misleading or false information on any matter material to the grant of a cover.
5. Wherever the benefit of nomination is available to the proposer, in terms of the Act or the conditions of policy, the insurer shall draw the attention of the proposer to it and encourage the prospect to avail the facility.
6. Proposals shall processed by the insurer with speed and efficiency and all decisions thereof shall be communicated by it in writing within a reasonable period not exceeding 15 days from receipt of proposals by the insurer.

From bare reading of the Regulation 4 of  IRADA Regulations it is evident that the insurer is duty bound to furnish cover note to the insured within 30 days of acceptance of proposal form and the insured can cancel the policy within 15 days  after receipt of the insurance policy. But in the instance case the complainant/ insurer did not exercise her right provided under Regulation-4 of the IRADA Regulations. She paid first premium on which the next due date of the premium was mentioned. The complainant withdrew the policy against the terms and conditions of the insurance policy. Therefore, the insurance policy and cover being a contract, the parties are bound by the same. The complainant/ insured cannot challenge the policy and requests for the early refund of he deposit.

Further more the policy is a unit linked policy whereby the investment is made by the complainant through share market speculative transactions. The unit linked policies are different from other insurance policies and are subject to different risk factors. The investment risk is born by the policy holder.

Learned counsel for the opposite party no.2 argued that the complainant has purchased a unit linked policy whereby the investment is made through share market/ speculative transactions and main motive for investment is for profit and gains. She has drawn our attention to order dated 23.04.2012 passed by Hon’ble National Commission in Revision No.658 of 2012 titled Ram Lal Aggarwala Vs. Bajaj Allianz Life Insurance Co. Ltd. and has vehemently argued that the complaint in respect of the claim under unit linked insurance policy is not maintainable under the Consumer Protection. Act; the money having been invested in speculative business.

After giving our thoughtful consideration to the rival contentions, we feel that the arguments of the learned counsel for the opposite party have considerable force and the same must prevail. The copy of the proposal form itself shows that the complainant affixed his signature on the proposal form. Pertinently, all unit linked policies are different from traditional insurance policies and are subject to different risk factors. In the said policy, the investment risk in investment portfolio is borne by the policy holder. The copy of judgment dated 23.04.2013 in Revision Petition No.658 of 2012 titled as Ram Lal Aggarwalla V. Bajaj Allianz Life Insurance Co. Ltd. (Supra) shows that in that case the dispute was regarding Unit linked insurance policy and the claim under that policy was disallowed by the District Forum by making following observations:-

“The investment made by the petitioner/ complainant was to gain profit. Hence, it was invested for commercial purposes and, therefore, the petitioner/ complainant is not a consumer under the opposite parties. The State Commission, Odisha in Frist Appeal No.162 of 2010 in the case of Smt. Abanti Kumari Sahoo V. Bajaj Allianz Life Insurance Company Ltd., have held that the money of the petitioner / complainant invested in the share market is no doubt a speculative gain and the speculative investment matter does not come under the Act and accordingly, the State Commission dismissed the appeal”.

Importantly, against the order of the District Forum, the complainant filed an appeal before the Hon’ble State Commission which was dismissed. Dis-satisfied with that order, the complainant filed a revision petition before the Hon’ble National Commission and the Hon’ble National Commission did not find any jurisdictional error, illegality or infirmity in the order passed  by the Hon’ble State Commission warranting interference. The matter relating to unit linked policies was also agitated in Smt. Parmajit Kaur Vs. Aviva Life insurance Company India Limited (Supra) and Metlife India Insurance Co. Vs. Gurjit Singh (Supra) decided by the Hon’ble State  Commission, Punjab and it was held that the complaint in  respect of the claim under unit linked insurance policy is not maintainable under the Act; the money having been invested in a speculative business.

Similar are facts of the present complaint. Admittedly the insurance policy of the complainant is a unit linked policy and different from traditional insurance policies. Therefore, the complainant is not a consumer under  Consumer Protection Act and the complaint is not maintainable.

In the light of our above discussion and observations, the complaint is dismissed.

Order pronounced on : 01.04.2017

• Copy of order be sent to the concerned parties free of cost.
• Thereafter, file be consigned to record.

                  

 

(PUNEET LAMBA)                                                                          ( R.S.  BAGRI )

                           MEMBER                                                                             PRESIDEN