Complaint is filed on 12-2-2009
Compliant disposed on 17-6-2010
BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM
::AT:: KARIMNAGAR
PRESENT: HON’BLE SRI K. DEVI PRASAD, B.Sc., LL.B., PRESIDENT
HON’BLE SMT. E. LAXMI, M.A.LL.M.,PGDCA (Consumer Awareness), MEMBER
HON’BLE SRI. K. CHANDRA MOHAN RAO, B.Com., LL.B., MEMBER
THURSDAY, THE SEVENTEENTH DAY OF JUNE, TWO THOUSAND TEN
CONSUMER COMPLAINT NO. 107 OF 2009
Between:
V. Sampath Kumar, S/o. Late Vidya Venkataiah, Age 25 years, Occ: Car Driver, R/o. Julapalli village of Kamanpur mandal district Karimnagar.
… Complainant
AND
Life Insurance Corporation of India Peddapally branch, Peddapally proper and mandal district Karimnagar. R/by it’s Manager.
…Opposite Party
This complaint is coming up before us for final hearing on 18-5-2010, in the presence of Sri B.Srinivas and Smt. B. Geetharani, Advocates for complainant, and Sri J. Sree Ramulu, Advocate for opposite party, and on perusing the material papers on record, and having stood over for consideration this day, the Forum passed the following:
:: ORDER::
1. This complaint is filed under Section 12 of C.P.Act 1986 seeking direction to the opposite party to pay a sum of Rs.45,000/- , Rs.50,000/- and Rs.50,000/- towards the sum assured under 3 Insurance Policies along with interest, compensation and costs.
2. The brief averments of the complaint are that the father of the complainant Vidya Venkataiah obtained 5 insurance policies bearing nos. (i) 682312863 (ii) 680608545 (iii) 682320813 (iv) 683430921 (v) 683430181 from the opposite party under Salary Saving Scheme as he was working in Singareni Collaries Company Ltd. Under the said policies he nominated the complainant as nominee to receive the sum assured in case of his death. The policy holder died on 9.1.2003 due to ill-health. Within one month of his death the complainant submitted the claim to the opposite party for payment the amount payable under the said policies. But the opposite party settled the claim pertaining to policies no.682312863 and 680608545 and paid the sum assured under the policies. Regarding Policy no.682320813 the opposite party paid an amount of Rs.7,178/- towards the total amount payable under the said policy. In respect of policies no.683430921 and 683430181 no amount was paid by the opposite party. When the complainant requested the opposite party to settle the claim they have postponed the same on one or the other reason. Therefore, the complainant got issued a Legal Notice through his Advocate on 18.6.2009. Inspite of service of Legal Notice the opposite party failed to settle the claim under the policies. The complainant submits that the sum assured under policy no.682320813 is Rs.50,000/- but the opposite party paid only Rs.7,178/- and failed to pay the total sum assured. As per the terms and conditions of the policy the opposite party is liable to pay the amount and failure to pay constitutes deficiency of service, therefore sought direction for payment of the amounts.
3. The opposite party filed counter denying all the averments made in the counter. It is submitted by the opposite party that the complaint is barred by limitation and it is filed after expiry of the period stipulated under Sec 24 A of C.P.Act 1986. The cause of action arose on 9.1.2003 when the policy holder died and the limitation for filing complaint expired on 29.4.2005. During the life time of the deceased he obtained 5 policies for Rs.10,000/-, Rs.20,000/-, Rs.50,000/-, Rs.45,000/- and Rs.50,000/-After receipt of the claim from the complainant on account of death of the policy holder, the opposite party paid the sum assured sum under policy no.682312863 and policy no.680608545 as they were in force on the date of his death. The other 3 policies were in lapsed condition due to non-payment of the monthly premium. Regarding policy no.682320813 the policy holder paid premium upto July 2002 and as it acquired paid up value a sum of Rs.7,178/- is paid towards the total amount is payable under the said policy. Regarding policy no.683430921 the date of commencement is 28.3.2002 and the last premium was paid for the month of May 2002. Regarding policy no.683430181 the date of commencement is 15.2.2002 and the last premium was paid for the month of August 2002. As both the said policies did not acquire any paid up value no amount is payable under the policy. Since the claim of the complainant is barred by limitation the opposite party prayed for dismissal of the complaint.
4. The complainant filed Proof Affidavit reiterating the averments made in the complaint and filed documents which are marked as Ex.A1 to A6. Ex.A1 is the attested copy of Death Certificate Dt: 15.2.2003. Ex.A2 is the Status Report of policy no.683430921 for an amount of Rs.45,000/-. Ex.A3 is the Status report of policy no.683430181 for an amount of Rs.50,000/-. Ex.A4 is the Status report of policy no.682320813 for an amount of Rs.50,000/-. Ex.A5 is the office copy of Legal Notice Dt: 18.6.2009. Ex.A6 is the Courier Receipt Dt; 20.6.2009.
5. The opposite party filed the Proof Affidavit of it’s Administrative Officer reiterating the averments made in the counter and filed documents which are marked as Ex.B1 to B6. Ex.B1 & A4, Ex.B2 & A3, Ex.B3 & A2 are one and the same documents. Ex.B4 is the copies of “Conditions and Privileges Within Referred to”. Ex.B5 is the Xerox copy of letter from Divisional Office, Karimnagar addressed to Branch Manager, Karimnagar Dt: 11.8.1998. Ex.B6 is the Xerox copy of letter from LIC Central Office addressed to all its branches of LIC and Audit & Inspection Department Dt; 10.07.1998.
6. The points for consideration are:
- Whether there is any deficiency of service on the part of opposite party?
- If so, to what relief the complainant is entitled?
7. Heard both sides.
8. It is contended by the complainant that the opposite party ought to have settled the claim for payment of the sum assured in respect of the Insurance Policies mentioned in Status Reports under Ex.A2 to A4. The policy holder obtained 5 policies under Salary Saving Scheme authorizing his employer to pay the monthly premiums to opposite party by deducting from his salary. It is the duty of the opposite party to inform about non-receipt of the premiums. After death of policy holder on 9.1.2003 the complainant submitted claims for payment of the sum assured, but the opposite party failed to pay the amounts in respect of 2 policies covered by Ex.A2 and Ex.A3. Regarding the policy covered under Ex.A4 the opposite party paid Rs.7,178/- towards paid up value. Since the date of death of the policy holder the complainant has been demanding for settlement of the claim and a Legal Notice under Ex.A5 was also issued on 18.6.2009. Non-payment constitutes deficiency of service. The learned counsel for complainant relied on the judgments of Hon’ble National Commission reported in:
- 2009 (2) CPR 85 (N.C.).
- 2009 (2) CPR 143 (N.C.)
- 2005 (2) CPR 122 (N.C.)
9. It is contended by the opposite party that the complaint is barred by limitation as it is not filed within 2 years of death of the insured. By the date of issuing the Legal Notice under Ex.A5 which is Dt: 18.6.2009 the period of limitation will not be extended. The policies covered by Ex.A2 to A4 were in lapsed condition for non-receipt of monthly premiums. The policy no.683430921 for Rs.45,000/- commenced on 28.3.2002 and the last premium was paid on 30.5.2002. The policy no.683430181 for Rs.50,000/- commenced on 15.2.2002 and the last premium was paid in August 2002. As the said 2 policies did not acquire any paid up value no amount is payable under the policies. When the complaint is filed after the period of limitation it deserves to be dismissed. The counsel for the opposite party relied on the judgment of Hon’ble National Commission reported in 2009 (2) CPR 303 and 2009 (2) CPR 307 (NC). Therefore, the opposite party prayed for dismissal of the complaint.
10. A perusal of the contents of the counter and Proof Affidavit of the opposite party it is an admitted fact that the father of the complainant obtained 5 insurance policies under Salary Saving Scheme from the opposite party and after his death 2 policies were settled and the amount was paid to the complainant. A perusal of Status Report under Ex.A2, A3 and A4 the policy holder obtained said policies for Rs.45,000/-, Rs.50,000/- and Rs.50,000/- under Salary Saving Scheme. When the complainant submitted claim for all the 5 policies the sum assured under the 3 policies were not paid by the opposite party on the ground that they were in lapsed condition on the date of death of the policy holder. Under the policy no.683430921 covered under Ex.A2 the complainant is the nominee. In respect of policy no.683430181 covered by Ex.A3 Status Report the policy holder nominated his son Sampath Kumar i.e. complainant as the nominee. Whereas the Status report under Ex.A4 pertaining to policy no.682320813 the policy holder nominated one Sarojana as the nominee to claim the sum assured under the policy. The Sarojana is not the complainant before this Forum.
11. The complainant claimed the sum assured under the 3 policies on the ground that the opposite party failed to pay the sum assured on the ground that they were in lapsed condition. However the opposite party paid the amount acquired as paid up value in respect of policy no.682320813. The complainant relied on the judgment of Hon’ble National Commission reported in 2009 (2) CPR 85 where in it was held that when the policy is taken under Salary Saving Scheme it is the duty of the opposite party to inform the policy holder about non-receipt o the premium. In other case reported in 2009 (2) CPR 143 it is held that “where a premium for LIC policy was to be remitted from salary and failure in remittance was for no fault of insured and employer was liable for that fault, employer being agent of LIC, Corporation was liable to pay policy amount”.
12. The opposite party relied on the judgment of Hon’ble National Commission reported in 2009 (2) CPR 303 and 2009 (2) CPR 307 regarding the period of limitation for filing complaint under the C.P.Act. In the said cases it is held that no amount of correspondence “or” meetings can extend the period of limitation.
13. In the present case the complainant submitted that the opposite party did not settle the claim and therefore a Legal Notice under Ex.A5 was served on the opposite party for payment of the sum assured for the 3 policies. The contents of counter and Proof Affidavit filed by the opposite party discloses that a claim was made by the complainant for all the 5 policies but opposite party settled and paid in respect of 2 policies and part of the amount was paid in respect of another policy. When the policies are issued under Salary Saving Scheme it is the duty of the opposite party to collect the premium and the sum assured cannot be denied on the ground of non-receipt of the premiums.
14. The opposite party did not produce any document to show that the intimation was given to the complainant about repudiation of the policy except filing Status Reports under Ex.B1, B2 and B3. As no information is received by the complainant it can be referred that the claim is not settled by the opposite party. Under the provisions of C.P.Act 1986 the cause of action for filing the case commences from the date of demand of the claim. Having issued the Insurance Policies, the opposite party is bound to pay the sum assured under the policies as the policy holder died which is evidenced by the Death Certificate under Ex.A1 and non-payment constitutes deficiency of service. Hence we hold, that the opposite party is liable to pay the sum assured to the complainant. The policy no.683430921 was issued for an assured sum of Rs.45,000/- and the policy no.683430181 was issued for an assured sum of Rs.50,000/- and under both the policies the complainant is the nominee to receive the sum assured. Therefore, the opposite party is liable to pay the sum assured under the above said 2 policies with eligible bonus. Regarding policy no.682320813 the complainant is not entitled to claim the amount as he is not the nominee under it.
15. In the result the complaint is partly allowed directing the opposite party to pay the sum assured under the policy no.683430921 for Rs.45,000/- and policy no.683430181 for Rs.50,000/- with eligible bonus together with interest @ 9% P.A. from the date of filing the complaint i.e. 8.7.2009 and Rs.1,000/- towards costs of the complaint within a period of one month from the date of receipt of this order. Rest of the claim in respect of policy no.682320813 is dismissed.
Typed to my dictation by Stenographer, after correction the orders pronounced by us in the open court this the 17th day of June 2010.
Sd/- Sd/- Sd/-
MEMBER MEMBER PRESIDENT
NO ORAL EVIDENCE HAS BEEN ADDUCED ON EITHER SIDE
FOR COMPLAINANT:
Ex.A1 is the attested copy of Death Certificate Dt: 15.2.2003.
Ex.A2 is the Status Report of policy no.683430921 for an amount of Rs.45,000/-.
Ex.A3 is the Status report of policy no.683430181 for an amount of Rs.50,000/-.
Ex.A4 is the Status report of policy no.682320813 for an amount of Rs.50,000/-.
Ex.A5 is the office copy of Legal Notice Dt: 18.6.2009. Ex.A6 is the Courier Receipt Dt; 20.6.2009.
FOR OPPOSITE PARTY:
Ex.B1 & A4, Ex.B2 & A3, Ex.B3 & A2 are one and the same documents.
Ex.B4 is the copies of “Conditions and Privileges Within Referred to”.
Ex.B5 is the Xerox copy of letter from Divisional Office, Karimnagar addressed to Branch Manager, Karimnagar Dt: 11.8.1998.
Ex.B6 is the Xerox copy of letter from LIC Central Office addressed to all its branches of LIC and Audit & Inspection Department Dt; 10.07.1998.
Sd/- Sd/- Sd/-
MEMBER MEMBER PRESIDENT
