SMT.MOLYKUTTY MATHEW : MEMBER
This is a complaint filed by the complainant U/S 35 of the Consumer Protection Act 2019 for an order directing the OP’s jointly and severally liable to pay Rs.5,29,610.94/- the amount payable under the policy with 12% interest from 18/8/2020 on wards and to pay compensation of Rs.25,000/- and Rs.5000/- as litigation cost to the complainant for the deficiency of service and unfair trade practice on the part of OP’s.
The brief of the complaint:
The complainant is an ex-serviceman. The 1st OP through their agent represented before the complainant that they are having a very good policy with high returns under the plan name “Kotak Second Innings” and is a best policy . It is assured that the entire maturity value will be repaid with high bonus /profits. Believing the words of OP’s the complainant took a policy bearing No.02092564, Kotak second innings plan (UIN -107L052V02) dtd.18/8/2010. The complainant paid Rs.99,999/- being the annual premium policy. The OP issued the policy to the complainant and the validity is 10 years and the maturity date is 18/8/2020. The complainant paid Rs.99,999/- in the year 2010,2011 and 2012 thereafter the complainant was not able to pay the premium. Thereafter on 20/8/2020 the complainant received a letter from OP enclosing a cheque for Rs.1,76,519.33 being the 1/3rd of the maturity amount and informing that 2/3rd of the maturity amount has to be used for purchase of another annuity policy either from them or from any other insurance company. The complainant refused to receive the cheque amount so as at the time of taking the policy he was not informed about the investment of 2/3rd of the maturity amount in another policy. If the complainant was aware of such condition for re-investment in another policy he will never take such a policy. Then the complainant send a registered lawyer notice dtd.26/2/2021 to OP’s to pay full maturity amount in lump sum with interest and cost. 1st OP ‘s notice unserved and 2nd OP received the notice on 27/2/2021. On 8/4/2021 the OP’s send a reply alleging false and baseless allegations. The act of OPs the policy which forces the complainant to utilize the maturity value to take another policy is unfair trade practice. Alleging the above said act amounts to deficiency of service and unfair trade practice on the part of OP’s. Hence the complaint.
After receiving notice both OP’s appeared before the commission and filed their written version contending that in this policy, the investment risk in investment port folio is born by the policy holder. As per clause No.8 of the proposal form he had voluntarily opted for the proposed plan and also agreed to abide by all the terms and conditions stated at the proposal stage. Moreover every policy document sent by the OP is accompanied with a copy of the proposal form signed by the applicant and a forwarding letter which clearly mention that in case policy holder is not satisfied with the features of the terms and conditions of the policy proposal form signed by the applicant and a forwarding letter which clearly mention that in case policy holder is not satisfied with the features of the terms and conditions of the policy withdraw/return the policy within 15 days ie, under the “free look cancellation period”. The OP had sent the policy documents were despatched at the registered address of the complainant on 27/8/2010 through speed post via, airway bill No.EM157614879 IN and the same was delivered to the complainant also. The policy is a legal contract between the policy holder and the insurance company and the parties to the said contract are bound by its terms and conditions. The policy holder shall have the option of taking the maturity proceeds are entire maturity proceeds can be taken as annuity or maximum upto 1/3rd of the maturity proceeds may be taken as a lump sum and the balance must be used to buy a life annuity. The complainant paid only 3 annual premium till 19/8/2012. Thereafter on 18/8/2020 the policy matured. Since the plan chosen was a deferred annuity plan. Only 1/3rd can be opted as pay out and the rest 2/3rd of the maturity amount has to be utilised to purchase another annuity policy as per IRDAI guidelines. The policy has matured and the OP had despatched the cheque to the complainant for the 1/3rd maturity amount ie, Rs.176519.33/-. The balance 2/3rd amount of Rs.3,53,091.61/- is with the OP’s under unclaimed fund. The OP’s had not done anything against the terms and conditions of the policy. So there is no deficiency in service and unfair trade practice on the part of OP’s. Then the complaint may be dismissed.
On the basis of the rival contentions by the pleadings the following issues were framed for consideration.
- Whether there is any deficiency of service on the part of the opposite parties?
- Whether the complainant is entitled for any relief?
- Relief and cost.
The evidence consists of the oral testimony of PW1 and Exts. A1 to 5 were marked . On OP’s no oral evidence , Exs.B1to B5 marked(with objection).
Issue No.1:
The Complainant adduced evidence before the commission by submitting his chief affidavit in lieu of his chief examination to the tune of the pleadings in the complaint and denying the contentions in the version. He was cross examined as PW1 by the OP. The documents Exts.A1 to A5 were marked on his part to substantiate his evidence. According to the complainant on 18/8/2010 he took a policy for a period of 10 years and he paid Rs.99,999/- each from the years 2010 to 2012 ie Rs.2,99,997/-. The policy matured on 18/8/2020. Then the complainant got a letter from the OP enclosing a cheque for Rs.1,76,519.33/- which is 1/3rd of the maturity benefit and 2/3rd of the maturity benefit and asking the complainant to take another policy. In the evidence PW1 stated that “ സാധാരണ insurance policy എടുത്തു കഴിഞ്ഞാൽ 15 ദിവസം free look period ഉണ്ട് എന്നും അതുവഴി policy വായിച്ച് നോക്കി നിങ്ങൾക്ക് policy വേണോ, വേണ്ടയോ എന്ന് തീരുമാനിക്കാം എന്നും പറയുന്നു? ഞാൻ വായിച്ച് നോക്കിയിട്ടില്ല. Delcaration form ൽ maturity value, surrender value പറ്റിയും പ്രത്യേകിച്ച് പറഞ്ഞിട്ടുണ്ട് എന്ന് പറയുന്നു? അറിയില്ല. As per Ext.A1 document maturity benefit noted as “Fund value in main account plus, guaranteed bonus at maturity as described , fund value in the top up account(if any). The condition to utilization of either full or 2/3rd amount to buy another policy and will automatically extend the period of policy and will result in non –payment of the maturity benefit agreed. 2/3rd amount of maturity value is not communicated to the complainant. So the annuity is not defined in the contract. Sec.29 of the Indian Contract Act make the agreement void for uncertainty. There is no specification about the annuity policy and what will be the return of such policy which is very essential facts intimated to the party for taking policy. So the clause regarding disbursement either full or 2/3rd amount for buying another policy lacks specification, clarity and is hit by Sec.29 of Indian contract Act. Sec.57 & 58 of India Contract Act clearly shows that when one part of the contract is legal and another part is illegal the legal clause is contract and the illegal part is void agreement. Moreover the complainant states that the maturity benefit will payable on maturity date, ie, 10 year policy and the maturity date is 18/8/2020 and failed to pay the same is unlawful trade practice in Sec.2(46) and Sec.2(47) (1) (b) and (f) of the Consumer protection Act. On OP’s side Exts.B1 to B5 documents produced to substantiate their defense. In the version and argument note submitted by OP’s that the annuity plan policy has not received from the complainant. But the complainant received Rs.1,79,819/- from the OP as 1/3rd amount. So the 2/3rd amount is in the custody of OP’s ie, Rs.3,53,091.60/- that is also admitted by the OP’s. So we hold that the OP’s are directly bound to redressal the grievance caused to the complainant. So there is deficiency of service and unfair trade practice on the part of OP’s. Hence the issue No.1 found in favour of the complainant and answered accordingly.
Issue Nos.2&3:
As discussed above the complainant’s policy matured on 18/8/2020. The OP’s are liable to pay the full maturity amount to the complainant on the date of maturity cannot retain 2/3rd amount with themselves or compel the complainant to buy another policy unknown to the complainant. Therefore we hold that the OP is already paid 1/3rd amount Rs.1,79,819/- to the complainant in addition to that the balance 2/3rd amount Rs.3,53,091.60/- has to be paid to the complainant with 9% interest per annum from 18/8/2020 till realization along with Rs.7000/- as compensation and Rs.3000/- as litigation cost. Thus the issue No.2&3 are also accordingly answered.
In the result the complaint is allowed in part directing the opposite parties 1&2 jointly and severally liable to pay 2/3rd amount Rs.3,53,091.60/- to the complainant with 9% interest per annum from 18/8/2020 till realization along with Rs.7000/- as compensation and Rs.3000/- as litigation cost within 30 days of receipt of this order. In default the amount of Rs. 3,53,091.60/- carries 12% interest per annum from 18/8/2020 till realization. Failing which the complainant is at liberty to execute the order as per the provisions of Consumer Protection Act 2019.
Exts:
A1- original insurance policy
A2-lawyer notice
A3-Return notice of 1st OP
A4-Acknowledgment card
A5-Reply of 2nd OP
B1- copy of proposal form
B2- Copy of applicants declaration
B3-copy of policy document
B4- copy of letter with cheque
B5- Reply notice
PW1-K.V.Raghunathan- Complainant
Sd/ Sd/ Sd/
PRESIDENT MEMBER MEMBER
Ravi Susha Molykutty Mathew Sajeesh K.P
eva
/Forwarded by Order/
ASSISTANT REGISTRAR
