DISTRICT CONSUMER DISPUTES REDRESSAL FORUM-II
Udyog Sadan, C-22 & 23, Qutub Institutional Area
(Behind Qutub Hotel), New Delhi- 110016
Case No.82/2019
Adish Kumar Jain
K.No.158/4, Rajpur Khurd Extension
Near Sant Mant Ashram
New Delhi-110068. .…Complainant
VERSUS
Kotak Mahindra Old Mutual Life Insurance Ltd.
Branch Office at Plto No.S-5
Green Park, Main Market
New Delhi-110016. ….Opposite Party
Coram:
Ms. Monika A Srivastava, President
Ms. Kiran Kaushal, Member
Present: Adv. M.K. Chaudhary for complainant.
Present: Adv. Tauseef Ahmed Proxy counsel for Adv. Sanjay Chaudhary with authority letter for OP.
ORDER
Date of Institution:22.03.2019
Date of Order :08.10.2024
President: Ms. Monika A Srivastava
Complainant has filed the present complaint seeking direction to the OP to refund Rs.1,01,236/- with interest @18% per annum from the date of receipt of the premium till realization; Rs.1,00,000/- towards compensation and Rs.25,000/- towards litigation cost. OP is Kotak Mahindra Old Mutual Life Insurance Ltd.
- It is the case of the complainant that he had taken three insurance policy from the OP (i) Policy N o.02758974 for Rs.2,59,173/- dated 04.06.2013 having premium of Rs.25,000/- (ii) Policy no.02754351 for Rs.3,75,658/- dated 24.05.2013 having premium of Rs.34,921/- (iii) Policy no.02754360 for Rs.1,54,787/- dated 24.05.2013 premium of Rs.15,000/-.
- It is stated by the complainant that he had taken these policies on the basis of representation and assurance give by the OP that being private insurance company, OP is consumer friendly. After taking the said policy complainant duly paid the premium in the next year however, due to unavoidable circumstances complainant could not make the payment of premium in the next year and therefore Policy no.02754351 & Policy no.02754360 lapsed. Copy of the policy documents are annexed as annexure CW/1 (colly).
- It is further stated that in April 2016 complainant managed the requisite amount and applied for revival of aforesaid two policies and accordingly paid balance premium of Rs.35,554/-. OP upon receipt of the revival application and due amount accepted however, after five days they refused to renew the policy and refunded the amount paid by the complainant on frivolous ground “after careful consideration of your application for major revival, we regret to inform you that the same has been declined due to following reason – medical finding to policy No.02792192”. Copy of the letters dated 02.05.2016 are annexed as annexure CW/2 (colly).
- It is stated by the complainant that the medical examination was in relation to the first policy and not for the other two policies which were issued on non-medical basis in which no medical examination was required. It is further stated that complainant had applied for renewal of policies which was already issued in May 2013 and the same cannot be terminated on the basis of subsequent medical finding, if any. It is further stated that despite several visits and representations and correspondences made by the complainant OP did not renew the policies. Copies of mails are annexed as annexure CW/3 (colly).
- In this regard, complainant issued a legal notice in February 2017 and the OP vide letter dated 24.03.2017 informed the complainant that he may apply for revival of the said policies once again by making entire payment of outstanding premium.
- It is stated that complainant having lost faith in the OP decided not to revive the policy and requested them to make the refund of entire premium amount paid by the complainant yet the OP has failed to make the payment malafidely. Copy of the letters dated 24.03.2017 is annexure CW/4.
- It is further stated that instead of refunding the amount demand from the complainant OP vide letter dated 29.05.2017 deactivated the ECS mandate given by the complainant in respect of both the policies. Copy of the letter dated 29.05.2017 is annexure CW/5.
- It is the case of the complainant that OP is guilty of deficiency of service by refusing to revive the policies in April 2016 on the basis of subsequent medical finding which is completely malafide and illegal and against the terms of the policies.
- OP, in its reply has stated that now known as Kotak Mahindra Life Insurance Company Limited from 03.11.2017. OP has objected to the territorial jurisdiction of this Commission and has stated that complainant failed to prove any deficiency in service on the part of the OP. In this regard, complainant has relied on the definition of ‘deficiency’ as provided for under section 2 (g) of the CPA. It is stated that complainant was given an opportunity to cancel the policies within 15 days from the date of receipt of the policy documents if he was not satisfied with the terms and conditions contained therein. Despite having receiving the policy documents complainant failed to approach the OP for cancellation of the policies within the freelook period of 15 days from the date of receipt of the policies as per the terms and conditions of the policy.
- It is further stated that for policies mentioned at (ii) and (iii) complainant had only paid the initial premium and failed to pay the renewal premium which falls due from 2014 despite several reminders. The complainant on 27.04.2016 submitted a request for revival of policy No. 02754360 and 02754351 along with the outstanding premiums however, the policy could not be revived owning to the adverse medical findings and the same was informed to the complainant vide letter dated 02.05.2016. The premium amount paid towards the outstanding premium for revival of policies was also refunded to the complainant on 04.05.2016 and the policies were foreclosed.
- It is after that for policy 027558974 complainant had paid the renewal premiums and therefore the said policy was still in force. It is stated that the OP has acted in accordance with the terms and conditions of the policies therefore, no act of deficiency in service can be attributed to the OP. In this regard, OP has placed reliance on the judgment of the Hon’ble Supreme Court passed in Ravneet Singh Bagga Vs. KLM Royal Dutch Airlines (200) 1 SCC 66.
- It is stated that the complaint has been filed with the ulterior motive to cause harassment and prejudice to the OP which is a company of long standing and high repute.
- It is stated that the OP, as per clause 4(1) and 6 (2) of the IRDA (protection of policy holder’s interest) Regulations 2002, which was then in force sent the policies along with the copy of the proposal forms to the complainant giving without an opportunity to review/cancel the policy within freelook period. However, complainant did not approach the OP within freelook period with respect to the policy or its terms and conditions thereby implying that the terms and conditions were duly accepted by the complainant. In this regard OP has placed reliance on the judgment Hon’ble NCDRC in Mohan Lal Bindal Vs. ICICI Prudential Life Insurance Company Ltd. R.P. No.21780/2012 and Harish Kumar Chadha Vs. Bajaj Allianze Life Insurance Company Ltd. R.P. No.3271/2013 and Srikant Murlidhar Apte Vs. LIC R. P. No.634/2012.
- It is reiterated by the OP that the complaint does not disclose any cause of action since the complainant himself has failed to pay the renewal premium and the revival was declined due adverse medical findings. In this regard the terms relating to Revival of Lapsed Policy is provided as under:-
When the premium is not paid then the grace period as mentioned in clause 2 above, the policy together with the rider benefit, shall lapse from the due date of the unpaid premium except for cases where the non-automatic ……provision is applicable however, the policy holder can revive the lapsed policy with or without rider benefits, added to the basic policy by making application with a period of two years from the due date of the first unpaid premium and before the maturity date of the policy …….”.
Within six months from the due date of the first unpaid premium | Without evidence of health | on payment - of premiums in arrears and;
- 9% per annum of the premiums in arrears as an administration charge .
|
After six months i.e. within two years from the due date of the first unpaid premium and before the date of maturity of the policy. | On production of evidence of food health and good habits to the satisfaction of the company and also the evidence of there being no adverse change in the personal or family history or occupation. | As such premium rate and from such date as may be advised. |
- It is stated that the policy has a legal contract between the policy holder and the insurance company and the parties are bound by its terms and conditions. In this regard, OP has placed reliance on the judgment of the Hon’ble Supreme Court in case of Surajmal Ram Niwas Oil Mills (P) Ltd. Vs. United India Insurance Co. Ltd. (2010) 10 SCC 567 and Reliance Life Insurance Co. Ltd. Vs. Madhavacharya R.P. No.211/2009.
- It is stated that medical examination was done for another policy No. 02792192 and OP has a right to reject the claim if any adverse medical condition of the policy holder is noted. It is stated that complainant has made wrong declaration in the revival form and as hidden his medical adversities in the said application to induce the OP to issue the policy. It is further stated that since the subject policies were lapsed more than six months hence as per the terms and conditions, issue of good health was raised. It is stated that complainant was required to submit evidence of good health so as to rule out any medical adversities during the period when the policy was in lapse.
- In his rejoinder, complainant has mostly reiterated the averments made by him in the complaint. It is stated that the instant policy i.e. No.02754360 and 02754351 were issued on non-medical basis in which medical examination was not required. It is further stated that complainant has applied for renewal of policies which was already issued in May 2013 and the same cannot be terminated on the basis of subsequent medical findings, if any. It is stated that the medical examination was in respect of policy No.02792192.
- Both the parties have filed their respective evidence affidavits as well as written arguments. This Commission has gone through the entire material on record. It is seen that the complainant has issued a cheque from Chhattarpur Bank Branch, HDFC and since cause of action has arisen within the jurisdiction of this Commission, the Commission has the territorial jurisdiction to try the present complaint.
- It is seen that complainant took fresh policies from the OP 02758974, 02754351 and 02754360. There is no denial that the last two policies 02754351 and 02754360 got lapsed. It is further not denied that the complainant applied for renewal in April 2016 by paying the requisite premiums which were returned to the complainant by the OP stating that on account of adverse medical findings the policies cannot be renewed vide letter dated 02.05.2016.
- OP has placed on record, terms and conditions of the policy which entitles the OP to renew the policy when the lapsed period is more than six months. It is the discretion of the OP to seek medical report on the basis of which the policy could be renewed. In the present case, the OP vide its letter dated 02.05.2016 has refused to renew policies of the complainant citing adverse medical findings of the complainant. Further, the OP has sent a letter to Complainant dated 24.03.2017 asking the complainant to pay for the lapsed policies and seeking premium. Though this Commission is in agreement with the OP that as per the terms and conditions it could have refused the renewal of policies citing medical findings of the complainant yet this contention of the OP is not based on any proof. OP has not placed any document on record to show any adverse medical findings of the complainant.
This Commission is also aware that insurance is a subject of solicitation, and both the parties must agree for providing/taking an insurance agreement. In the present case, OP has not been able to prove valid reason for denying the premium of the lapsed policy and infact after denying has sought the premium again. The complainant cannot be paid surrender value etc. on the policies as the policies were not revived, therefore, this Commission directs the OP to refund the premium amounts paid by the complainant i.e Rs. 1,01,236/- on the lapsed polices with interest @ 5% p.a after deducting administrative charges of Rs. 3,000/- each policy i.e Rs. 6,000/-. This amount is to be paid to the complainant within three months from the date of the order failing which the OP would be liable to pay interest @ 7%p.a.
Copy of the order be given to the parties as per rules. File be consigned to the record room. order be uploaded on the website.
