SMT. RAVI SUSHA: PRESIDENT
Complainant has filed this consumer complaint U/s 12 of Consumer Protection Act 1986 seeking to get an order directing OP to pay Rs.38591/- with Rs.10,000/- towards compensation for the mental agony and Rs.10,000/- towards cost of the proceedings of the case.
The facts of the case are that complainant was a teacher at Govt. Higher Secondary School Irikkur, retired from service on 2021 March31st. She had purchased a State Insurance Policy from OP having No. SID/L1/249465728 On November 1992 till September 2020 whereby she was assured for an amount of Rs.38,591/-. The insured paid regular premium up to August 1995(8/1995). She did not pay premium for 6 months due to leave without wages. She deposited all the arrears of premium due for the intervening period of August 1995 to January 1996. She retired on 31/03/202. When she applied for sum assured, OP afford only Rs.12,065/- which was the premium amount remitted after LWA instead of getting Rs.38591/-. Hence filed this complaint.
Op filed written version denying the averment made by the complainant. It is submitted that this opposite party is the statuary under the state insurance department. There is no consumer relationship with the complainant; the contract with the complainant has not been existing, since the policy of the complainant was lapsed due to nonpayment of dues for continuous period of 6 months. If the policy holder paid subscription for continuous periods of 36 months the amount will be refunded, otherwise the amount will be forfeited subject to the relevant Rule. All these criteria were clearly mentioned in the Premium Receipt . Book given to the policy holder with Sub title Directions to Policy Holders. It is submitted that the complainant filed the application for SLI (State Life Insurance) on November 1992 with a premium of 40 rupees, the sum assured was 13,920/-. The premium due was from 13/11/1992 to 31/03/2020. But while verifying the policy No.249265728 from 08/1995 to 01/1996 since the policy holder was on leave without wages, on that period the premium has not been paid, even though she has received salary from 02/1996 she has re-started the payment from 01/10/1996, without any revival application and interest. The amount for SLI was paying in Lump sum basis by the disbursing officer, so there is no monitoring system. It is submitted that without revival application before the proper authority ie; State Insurance Department, the opposite party could not do anything in the lapsed policy. The complainant has not filed any application for revival. Hence the claim was settled by existing Rules. It is submitted that as per prevailing Rules regarding the lapsed policy the policy holder can get refund of the amount she paid, which was already refunded and paid. There is no deficiency of service from OP.
Complainant has filed her chief affidavit for evidence and was examined as Pw1 Ext.A1 to A4 were marked as documents on the side of complainant. OP has not oral or documentary evidence Pw1 was cross examined for OP.
Learned Additional Government pleader appeared for the OP and complainant in person have filed their argument notes. Complainant also made argument before us. We have perused the records and considered the submissions from both parties.
It is an admitted case of the parties that complainant had joined in the insurance policy with OP for a sum, of Rs.13,920/- on 13/11/1992 with a premium of 40/- per month and premium due was from 13/11/1992 to 31/03/2020. Insured retired on 31st March 2021.
Learned counsel for the OP submitted that premium due from, 08/1995 to 01/1996 (6 months) were not paid by the complainant and the complainant has not submitted revival application and that not revived the policy by paying the due amount and interest 9% per annum for the due period as per clause 21 of prevailing State Insurance Rules. As per Rules 20 (3) 20 (4) and 20(5) the policy of the complainant became lapsed and what to do while lapse of pre policy was clearly mentioned in the premium pass book issued to the complainant. It is also stated that after leave without salary when received salary from 2/1996 she re-started the payment from 01/10/1996, without any revival application and interest. It is further submitted that the amount for SLI was paying in lump sum by disbursing officer, without revival application before state Insurance Department, they could pay only the amount paid after the lapsed period. According to OP since the insured has not paid arrears premium along with interest and without revival application the policy was not considered to be re-instated.
On perusal of Directions to policy holder by Kerala State Insurance Department, it is seen that in clause 5, lapsed policy can be revived as per rule 21. Further Rule 21 stated about How a lapsed policy revived which states that a lapsed policy may be revived on payment of all arrears of premium with compound interest calculated from the 1st due date to the date of payment at 9% per annum. Such revival should be done with a period of three years from the date of the lapse of policy.
Here it is admitted fact that complainant had restarted the payment of premium from 01/10/1996. On perusal of Ext.A4 passbook it is seen that on 01/10/1996 complainant had paid Rs.400/- as arrea4rs due for 10 months and continued payment of premium till 25/03/2020 the date of Maturity. Thus undisputedly the insured had deposited all the arrears of premium within a period of three years from the date of the last premium paid by her that is 07/1995 because the arrears of premia were paid on 01/10/1996. Here it is also seen that OP accepted the arrears of premia remitted by the complainant.
Learned additional Govt. pleader for the OP submitted that complainant has not submitted application for the revival of the policy along with arrears and interest. Further since the amount for SLI was paying in Lump sum basis by the Head Master, there is no monitoring system in the State Insurance Department. We do not agree with the submission of Learned AGP because each premium of insured was received from the salary of each employee and remitted in the account of respective policy. Since the arrears and further premium of the insured till the mature period were received by the OP without any objection, OP cannot raise such a contention. In the present case, content ion of complainant is that no separate intimation regarding submission of revival of policy with payment of arrears along with 9 % interest was given to her. So she did have any knowledge of submission of revival application with payment of arrears. OP’s contention is that she had knowledge about the said clause as per clause 5 of Ext.A4. Here OP has no case that the state Insurance Rules will be given to each insured. So automatically complainant might not have knowledge about such clause in the Insurance Rules. Cross-examination of Pw1, she deposed that she had no such knowledge regarding submission of revival application with arrears premium and 9% interest should have been given by the complainant to the OP. It is contended by the OP that since the policy of the complainant was lapsed due to non-payment of dues for the continuous period of 6 months, there is no consumer relationship with the complainant. The said submission of OP also cannot be accepted because they have received the arrears premium amount on 01/10/1996 and accepted further premium insured till the date of maturity. Then OP was duty bound to issue separate intimation to the complainant to file revival application and remittance of interest for the due premium amount. Since the OP accepted arrears of premia, the policy automatically gets revive. Further non issual of separate intimation regarding payment of arrears with interest along with revival application to the complainant amounted deficiency on the part of OP. So complainant is entitled to get relief. From the evidence it is clear that though OP offered Rs.12065 and issued, voucher for that complainant has not accepted it. From Ext.A1, it is seen that sum assured value is mentioned as zero and vested Bonus also mentioned as zero. Only refund of excess premium Rs. 12,080 is calculated and deducted Rs.15 as interest on loan due and arrived gross claim amount as Rs.12,065/-. Here as per policy terms and conditions complainant is entitled to get sum assured Rs. 13,920/- and vested bonus Rs.24,431/-after deducting compound interest of arrears of premium Rs.400/- calculated from the 1st due date 08/1995 to the date of payment (10/96) at 9% per annum (clause 21 of existing Rule).
In the result complaint is allowed in part. OP is directed to pay to complainant the sum assured Rs.13,920 + vested bonus 24,431 amount after deducting compound interest of Rs.400 from 08/1995 to 10/1996 at 9% per annum, with Rs.5000/- as compensation for the mental agony within one month from the date of receipt of this order. Failing which the awarded amount carries interest @ 9% per annum from the date of complaint till realization. Complainant can realize the ordered amount by filing execution application against OP as per provisions of Consumer Protection Act 2019.
Exts.
A1 - Discharge Certificate
A2 - Reply of OP
A3 - Discharge certificate copy of complainant friend Anitha N K(subject proof marked with objection)
A4 - Copy of Passbook
Pw1 - Complainant
Sd/ Sd/ Sd/
PRESIDENT MEMBER MEMBER
Ravi Susha Molykutty Mathew Sajeesh K.P
(mnp)
/Forward by order/
Assistant Registrar
