Haryana

Karnal

CC/94/2015

Murti Devi W/o Jasmer Singh - Complainant(s)

Versus

Life Insurance Corporation Of India - Opp.Party(s)

Maya Ram Kadyan

27 Oct 2016

ORDER

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM KARNAL.

                                                              Complaint no.94 of 2015

                                                             Date of instt. 18.05.2015

                                                               Date of Decision 27.10.2016

 

Murti Devi wife of Shri Jasmer Singh son of Shri Rishal Singh, resident of village Jani, Post Office Naru Kheri, District Karnal.

                                                                             …………..Complainant.      

                                                Versus

1. Senior Divisional Manager, Life Insurance Corporation of India, Divsional Office, Model Town, Karnal.

2. Branch Manager, Life Insurance Corporation of India, Branch Office, Karnal-1, Model Town Karnal.                                                    

…………Opposite parties.

 

                     Complaint u/s 12 of the Consumer Protection Act.

 

Before                     Sh.K.C.Sharma……….President.

 Sh.Anil Sharma…….Member.

 

Present:-        Sh. M.R.Kadiyan Advocate for complainant.

  Sh. N.K.Zak Advocate for opposite parties.

 

ORDER:

 

                   This complaint has been filed by the complainant under section 12 of the Consumer Protection Act 1986, on the averments that her husband Jasmer Singh (deceased life assured) had been working as an insurance agent with opposite party no.2 since 19.08.1992 and agency code was 04220164. In the year 2007 the Life Insurance Corporation of India through circular dated 16.08.2007 introduced Group Insurance Scheme for the agents. As the agency of her husband was standing at credit  on 31.08.2007, the same was of more than 10 years, so insurance cover of Rs.5,00,000/- was provided and premium of Rs.1200/- per annum was recoverable from the commission earnings of the agency. Premiums were regularly deducted from the commission earnings of the agency on annual renewal date and insurance cover of Rs.5,00,000/- subsisted. However, he died on 21.12.2013. Being nominee under the agency, she is getting the Hereditary Commission from the agency of her husband. However, the group insurance amount of Rs.5,00,000/- for which her husband was covered has not been provided by the opposite parties. On verbal enquiries, the office of opposite party no.2 handed over letter dated 7.2.2015, wherein the Branch Manager informed that no premium was deducted for ARD 1.9.2013 hence nothing was payable. Thereafter, she addressed registered letter dated 28.2.2015 to the opposite parties for making payment of the amount of Group Insurance Cover, but to no response. Such acts and conduct on the opposite parties amounted to deficiency in service, which caused her mental pain, agony and harassment apart from financial loss.

2.                Notice of the complaint was given to opposite parties, who put into appearance and filed written statement controverting the claim of the complainant. Objections have been raised that the complaint is not maintainable in the present form; that the complainant has no locus standi and cause of action to file the complaint; that the complaint is bad for mis-joinder and non-joinder of necessary parties; that the complainant does not fall under the definition of consumer; that the complainant is estopped from filing the complaint by her own acts and conduct; that the complainant has not approached this forum with clean hands; that this forum has got no jurisdiction to entertain and decide the complaint and that the complaint is abuse of process of law.

                    On merits, it has been admitted that Jasmer Singh was working as an agent and covered under the Group Insurance Scheme w.e.f. 01.09.2007. However, it has been submitted that the agency of Jasmer Singh was terminated on 1.9.2012 and the same was reinstated on 3.10.2012. It was intimated that he had died on 21.12.2013. The due premium from 01.09.2013 was not deposited/paid by the agent due to which on the date of death his life was not covered for Group Insurance Scheme. Moreover, as per Group Insurance Scheme if any agent is terminated and is reinstated, then he can rejoin the Group Insurance Scheme. The agent did not apply for re-joining and did not deposit the annual premium due on 1.9.2013. Therefore, no benefit under the Group Insurance Scheme was payable and the claim of the complainant was rightly repudiated.

3.                In evidence of the complainant, her affidavit Ex.CW1/A and documents Ex.C1 to Ex.C9 have been tendered.

4.                On the other hand, in evidence of the opposite parties, affidavit of Balihar Singh Manager (Legal) Ex.OP1/A and document Ex.O2 have been tendered.

5.                We have appraised the evidence on record, the material circumstances of the case and the arguments advanced by the learned counsel for the parties.

6.                The parties are not at a dispute regarding the facts that Jasmer Singh the husband of the complainant, was agent of opposite party no.2 and he was covered under the group insurance scheme. His agency was terminated on 1.9.2012, but was reinstated on 3.10.2012. He died on 21.12.2013.

7.                The claim of the complainant regarding payment of the benefits of the Group Insurance cover of her husband was repudiated by the opposite parties on the ground that the premium of ARD 1.9.2013 was not deducted, therefore, nothing was payable. In the written statement the opposite parties have raised one more plea also that after reinstatement of the agency the deceased life assured was to rejoin the Group Insurance Scheme, but he did not join. Therefore, he was no more member of the scheme and as such there was no privity of contract and no claim was payable.

8.                During course of arguments both the learned counsel for the parties relied upon the copy of the Group Insurance Scheme for agent of the Corporation Ex.C1. For proper appreciation of the matter the relevant portions of the said scheme are reproduced as under:-

          “If any agent is terminated after Annual Renewal Date (ARD) and is reinstated after ARD, then he will not be covered for that policy year. He can re-join the Group Insurance Scheme from the next Annual Renewal Date. Please note that Insurance Cover cease from the date the agent is terminated.

          In case of termination of agent no premium will be refunded. If such terminated agent gets reinstated within the policy year, he will be covered for insurance from the date of reinstatement till the next Annual Renewal date without any further payment of premium.”

9.                A bare reading of the aforesaid portions of the scheme makes it quite clear that the scheme deals with two different categories of agents whose agencies are terminated and then reinstated, in separate manner. If, an agent is terminated after ARD and reinstated after ARD then he will not be covered for that policy year. He can re-join the Group Insurance Scheme for the next annual renewal date. If, terminated agent gets reinstated within policy year, he will be covered for the insurance from the date of reinstatement till next annual renewal date without any further payment of premium. Learned counsel for the complainant asserted that the case of the deceased life assured was covered under the second part whereas learned counsel for the opposite parties argued that the case was covered under the first part.

10.              The agency of the deceased life assured was terminated on 1.9.2012 and reinstated on 3.10.2012. Thus, it is clear that he was reinstated within the policy year commencing from 1.9.2012 and as such he was covered for insurance from the date of reinstatement till the next annual renewal date without any further payment of premium. This fact has not been disputed by the parties, even during the course of arguments that the deceased life assured was covered under the Group Insurance Scheme for the policy year commencing from 1.9.2012 to 31.8.2013. Policy premium was to be deducted from the agency earnings and it was the duty of the opposite parties to deduct the premium of the deceased life assured also from his agency earnings. However, no premium for the next policy commencing from 1.9.2013 was deducted. The contention raised by learned counsel for the opposite parties that the deceased life assured did not re-join the scheme, therefore, he was no more member of the scheme and the premium was not deducted for that reason, is not tenable and as such cannot be accepted. Re-joining of the Group Insurance Scheme from the next annual renewal date is required only in the case if the agent is terminated after ARD and reinstated after ARD and he is not covered for that policy year, but the deceased life assured was covered for the policy year commencing from 1.9.2012, therefore, there was no need for him to re-join the policy. Under such circumstances, we have no hesitation in observing that the opposite parties were not legally justified to repudiate the claim of the complainant on the ground that the deceased life assured did not re-join the scheme and that the premium for policy year commencing from 1.9.2013 was not deducted. It was incumbent upon the opposite parties to deduct the premium for the ARD 1.9.2013, because the deceased life assured continued to get all the benefits of the policy after his reinstatement during the policy year ending on 31.8.2013. In this way, there was deficiency in service on the part of the opposite parties.

11.              As a sequel of aforesaid discussion, we accept the present complaint and direct the opposite parties to pay Rs.5,00,000/- as insured amount to the complainant with interest @ 9% per annum from the date of filing the complaint till its realization. We further direct the opposite party to pay Rs.11,000/- to the complainant on account of mental agony and harassment suffered by her and for the litigation expenses. This order shall be complied within 30 days from the receipt of copy of this order. The parties concerned be communicated of the order accordingly and the file be consigned to the record room after due compliance.

Announced

Dated: 27.10.2016

                                                                                      (K.C.Sharma)

                                                                                         President,

                                                                             District Consumer Disputes

                                                                             Redressal Forum, Karnal.

                             (Anil Sharma)

                               Member