THE KERALA CONSUMER DISPUTES REDRESSAL COMMISSION VAZHUTHACADU THIRUVANANTHAPURAM

APPEAL NO.812/2012

JUDGMENT DATED: 16.05.2013

PRESENT

JUSTICE SRI.P.Q.BARKATH ALI              : PRESIDENT

The Branch Manager,

Bajaj Allianz Life Insurance

Corporation Ltd.,                                           APPELLANT

First Floor, Surumi Plaza Building,       

Fort Maidan, Palakkad-678001.                     

(By Adv. M. Rajesh Menon)

 Vs

1.  K. Ramakrishnan,

     Kandayil Veedu, Chirappadam,

     Thenkara P.O, Mannarkkad,

     Palakkad-678 761.                                    RESPONDENTS

     (By Adv. K. Dhananjayan)

2.  P. Devakumar,

     Puthukudi Chola Veedu,

     Karakurissi P.O,

     Palakkad.

JUDGMENT

JUSTICE SRI.P.Q.BARKATH ALI              : PRESIDENT

               This is an appeal filed under Section 15 of Consumer Protection Act of 1986 by the second opposite party in CC.No.37/2012 on the file of Consumer Disputes Redressal Forum, Palakkad challenging the order of the Forum dated 13^th August, 2012.

          The case of the complainant as detailed in the complaint and as stated in his proof affidavit filed before the forum in brief is this;

        The complainant was employed as LD cum clerk in Health Department and he is a handicapped person.  Now he has retired from service.  On 4^th July, 2008 he joined in the Insurance Scheme ‘ Bajaj Allianz New Unit Gain’ launched by the appellant/second opposite party on the representation made by first opposite party that if the complainant invests Rs.30,000/- in that scheme he will get Rs.90,000/- after 3 years.  Ext.B10 is the said policy.  After 1 year the Branch office of  appellant at Palakkad sent a letter to complainant  demanding further payment of Rs. 30,000/-.  On enquiry he was informed  that he has to pay a premium of Rs.30,000/- for 3 years.  The complainant paid the second premium on 10^th June 2011.  When the complainant received notice for third installment of premium  he approached the appellant claiming the amount deposited by him.  But the appellant gave him a cheque for Rs. 16,265.80 being the surrender value on surrendering the policy stating that as the complainant did not remit the third installment the policy has lapsed.  Therefore, the complainant filed the complaint claiming the balance amount.

             The first opposite party was one P. Devakumar, the agent of second opposite party.  He remained absent before the Forum.

             Appellant/second opposite party is Palakkad Branch of M/s Bajaj Allianz Life Insurance Corporation Ltd.  The appellant/second opposite party in the version as well in the proof affidavit filed by the Manager before the Forum contented this;

                   It is admitted that first opposite party was the agent of appellant company and the complainant joined in the policy as mentioned in the complaint.  The sum assured was Rs. 2,40,000/- and the term of  policy was 15 years.  The complainant has to pay at least premium of 3 years to receive the amount under the policy.  The premium was  Rs. 30,000/- per year.  Complainant paid only 2 years premium.   When he surrendered the policy the surrender value was given.  Therefore he is not entitled to any amount from the opposite parties.

               Proof affidavit of complainant was filed and Ext.A1 to A7 were marked on the side of the complainant.  Proof affidavit of the appellant company was filed and Ext.B1 to B8 were marked on the side of appellant/second opposite party before the Forum.  On an appreciation of evidence the Forum found that in the case of discontinued policy the maximum amount that can be deducted is only Rs. 5,000/- as provided under Clause 7 of the Insurance Regulatory and Development Regulations 2010 and directed the appellant and first opposite party to the complainant to pay the balance amount of Rs. 38,734/- and a compensation of Rs. 10,000/- and a cost of Rs. 1,000/-.  The second opposite party has came up in appeal challenging the said order of the Forum.

     Heard the counsels of both parties.

         The counsel for the appellant argued that the provisions of Insurance Regulatory and Development Regulation 2010 are applicable only to policies taken after 2010 and that therefore the          impugned order of the Forum cannot be sustained.  The counsel for the complainant on the other hand  supported the order of the Forum.

The following points arise for consideration.

1. Whether the provisions of Insurance Regulatory and   Development   Regulation 2010 are applicable to the transaction in question ?

2.    Whether the impugned  order of the Forum can be sustained?

It is admitted that complainant took Ext.B10 policy of appellant company on 4^th July, 2008 that he paid 2 years premiums of Rs. 30,000/- each and did not pay the third premium but surrendered the policy on 17/8/2011 that appellant paid Rs. 16,265.80 being the surrender value of the policy.  The complainant claimed the balance amount deposited by him.

              The counsel for the first respondent/complainant  argued that Clause 7 of Insurance Regulatory and Development Authority (Treatment of Discontinued Linked Insurance Policies )  Regulations, 2010 provides that in the case of discontinued policy the company can deduct only a maximum amount of Rs. 5,000/- towards discontinuance charge.  The counsel for the appellant on the other hand submitted that the said regulations is dated 1/7/2010 and the complainant took the policy in the year 2008 and that therefore the provisions of the said regulations are not applicable to the case on hand.  He pointed out that in Clause 1 of the said regulation it is stated that the said regulation shall apply to all products of linked life Insurance cleared by Authority thereafter.

             I find no substance in the contentions raised by the appellant.  The said regulation was issued under Clause (zd) of Sub Section 114A of the Insurance Act of 1938 read with  Section 14 and 26 of the Insurance Regulatory and Development Authority  Act of 1999.  Therefore the said regulation is only classificatory                    in nature and is in my view applicable to all products of discontinued policies which are discontinued after 01.07.2010.  Further in the present case the complainant discontinued the policy in 2010 and surrendered the same in 2011.  Therefore, I am of the view that  of the said Regulation is applicable to the present case. 

It follows that appellant is entitled to deduct only Rs. 5,000/- towards discontinuance charge and the balance amount appellant has to pay to complainant.  Finding of the Forum   on this point is confirmed.

               The Forum has directed the opposite parties to pay Rs. 38,734/- and a compensation of Rs. 10,000/- and a cost of Rs. 1,000/-.  I find no ground to interfere with the said findings of the Forum.

              In the result, this appeal is dismissed with a cost of Rs. 5,000/-

                                     JUSTICE P.Q.BARKATH ALI       : PRESIDENT

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