Haryana

Yamunanagar

CC/242/2011

Manjeet Kaur W/o Pritam Singh - Complainant(s)

Versus

Life Insurance Corporation - Opp.Party(s)

Parmod Bansal

05 Aug 2015

ORDER

 BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, YAMUNA NAGAR

                                                                                                Complaint No. 242  of 2011.

                                                                                                Date of institution: 21.3.2011.

                                                                                                Date of decision: 5.8.2015.

 

Smt. Manjeet Kaur wife of late Sh. Pritam Singh C/o Sh. Joginder Singh, Saraswati Gali, VPO, Mustfabad, District Yamuna Nagar.   

                                                                                                                                         …Complainant.

                                                   Versus

 

The Life Insurance Corporation, Co. 184-185, Sector-17, HUDA, Jagadhri, through its Branch Manager.  

 

                                                                                                                                         …Opposite party.  

 

BEFORE:         SH. ASHOK KUMAR GARG, PRESIDENT

                        SH. S.C.SHARMA, MEMBER.  

 

 

Present: Sh. Parmod Bansal, Advocate, counsel for complainant.     

              Sh. S.C.Garg, Advocate, counsel for OP.

 

ORDER

 

1.                        Complainant Smt. Manjeet Kaur has filed the present complaint under section 12 of the Consumer Protection Act 1986 praying therein that OPs be directed to release the maturity amount of policy to the tune of Rs. 1,68,762/- as on 14.7.2010 alongwith interest which comes to Rs. 20,806/- from 14.7.2010 to 21.3.2011 @ 18% per annum pendentelite and future till realization. Further direct to pay Rs. 50,000/- as compensation on account of mental agony, harassment and financial loss alongwith litigation expenses of Rs. 11,000/-. 

2.                     Brief facts as alleged in the complaint are that the complainant had purchased one (LIC’s FUTURE PLUS PLAN NO.172) policy bearing No. 174385869 dated 14.7.2005 from the opposite party and deposited a sum of Rs. 80,000/- as one time premium and maturity date was 14.7.2010. Hence, there is a relationship of consumer and supplier between the complainant and opposite party. After due date the maturity value of the said policy came to Rs. 168762/- on 14.7.2010 and she requested the opposite party to release the maturity amount but the opposite party instead of doing the needful evaded the matter on one pretext or the other and forced her either to deposit the said amount with them for further policy as pension scheme otherwise out of total amount of Rs. 1,68,762/- they will deduct 5% as surrender value. The complainant has not surrendered the said policy and the same had been matured on 14.7.2010. Thereafter, the opposite party sent a notice dated 11.10.2010 in which the opposite party had mentioned that surrender value of the said policy is Rs. 1,59,379/- after deducting 5% of maturity value and also asked the complainant to give his consent for the said amount whereas the maturity value of the said policy as on 14.7.2010 was Rs. 1,68,762/-. In this way, the opposite party has no right to deduct any amount.  Finding no other alternative, the complainant had sent a legal notice dated 8.2.2011 asking the opposite party to make the payment of maturity amount of Rs. 1,68,762/- within 7 days from the receipt of said notice which had been duly received by the opposite party but instead of doing the needful sent a false reply. There is a great deficiency and negligence in service as well as unfair trade practice on the part of opposite party. Hence, this complaint.

3.                     Upon notice, opposite party appeared and filed the written statement by taking some preliminary objections such as maintainability, parties are bound by the terms and conditions of Insurance Policy in question, complaint is false and frivolous and on merit admitting the fact that the complainant purchased the policy bearing No. 174385869 dated 14.7.2005 and deposited a sum of Rs. 80,000/- as one time premium and both the parties are bound by its terms and conditions of the policy in question. As per term and condition of the policy in question, complainant can surrender the policy on genuine medical ground subject to deduction of 5% of the maturity amount of policy in question. It is further stated that the commencement of the policy was 14.7.2005 under pension plan for 5 years. The date of maturity of the above policy was 14.7.2010. The entire amount of the above policy converted into pension plan and as per this plan the complainant was entitled for pension of Rs. 3012/- per month throughout her life and further as per her option the payment is to be made to the nominee in case of her death. Lastly prayed that OP is/was ready to do the needful in the matter  as per terms and conditions of the said policy but the complainant herself was negligent as she did not give her consent despite request letter dated 11.10.2010 (Annexure C-5) and Reply of Legal Notice/ letter dated 10.2.2011 (Annexure C-6), hence, there is no deficiency, negligence or unfair trade practice on the part of opposite party and prayed for dismissal of complaint.   

 4.                    To prove her case, counsel for complainant has tendered Affidavit of complainant as Annexure CX and documents such as Annexure C-1 Photo copy of surrender value quotation, Annexure C-2 Copy of registered AD legal notice, Annexure C-3 Postal Receipt, Annexure C-4 Acknowledgement, Annexure C-5 Letter dated 11.10.2010 regarding lump sum surrender value, Annexure C-6 Reply of Legal Notice/Letter dated 10.2.2011 and closed the evidence on behalf of complainant.   

5.                     On the other hand, counsel for the opposite party tendered affidavit of Sh. P.K.Saxena, Manager (L&HPF) LIC of India, Divisional Office, Karnal as Annexure RX and documents such as Annexure R-1 Photo copy of insurance policy, Annexure R-2 Photo copy of letter dated 7.5.2010 for revision of surrender factors, Annexure R-3 Photo copy of reply of legal notice, Annexure R-4 Photo copy of surrender value quotation, Annexure R-5 Photo copy of letter dated 11.10.2010 for lump sum surrender value, R-6 Photo copy of pension plan and closed the evidence on behalf of OP.  

6.                     We have heard the learned counsels for both the parties and have gone through the pleadings as well as documents carefully and minutely placed on file.

7.                     It is admitted fact that the complainant purchased LIC’s Future Plus Policy (Plan No.172) bearing No. 174385869 dated 14.7.2005 from the OP and deposited a sum of Rs.  80,000/- as one time premium and its maturity date was 14.7.2010. It is also not disputed that the maturity value of the said policy was Rs. 1,68,762/- as on 14.7.2010.

8.                     Learned counsel for the complainant argued that complainant purchased the LIC’s Future Plus policy bearing No. 174385869 on 14.7.2005 and deposited a sum of Rs. 80,000/- as one time premium and the same matured on 14.7.2010. the maturity value of the said policy was Rs. 1,68,762/- as on 14.7.2010 as per Annexure C-1 but the OP instead of releasing the maturity amount evaded the matter and are forcing the complainant to deposit the maturity amount with them in pension scheme policy, otherwise, if the complainant did not deposit the amount in the pension scheme policy, then, they will deduct 5% of the maturity amount which is wrong and illegal and against the business ethics. Lastly prayed for acceptance of the complaint as prayed.

9.                     On the other hand, learned counsel for the OP argued that as the complainant purchased the pension plan and as per terms and conditions of the policy in question, the entire matured amount of the policy was to be converted into pension plan and as per this plan the complainant was entitled for pension of Rs. 3,012/- per month throughout her life and further as per her option the payment was to be made to the nominee in case of her death. Learned counsel for the OP further argued that the complainant can surrender the policy only on genuine medical ground and in that case she can take the maturity amount after deducting 5% of the maturity amount. Learned counsel for the OP draw our attention towards the letter dated 7.5.2010 (Annexure R-2) in which guidelines to surrender the policy has been incorporated and further referred letter dated 11.10.2010 and 10.2.2011 in which the complainant was asked to give his consent for accepting the amount of Rs. 1,59,379/- after deducting 5% amount of surrender value but the complainant herself was negligent as she has not given her consent. Hence, there is no deficiency in service or negligence on the part of OP and referred the case law titled as National Insurance Company ltd. vs. Mehboob Khan 2012(2) CPR page 76 ( NC) wherein it has been held that Insurance Company cannot be asked to settle claims beyond terms & conditions of the policy.

10.                   Admittedly, the complainant purchased the aforesaid policy bearing No. 174385869 on 14.7.2005 for a period of five years after paying a sum of Rs. 80,000/- as one time premium and the same was matured on 14.7.2010. From the perusal of Annexure R-4, it is clear that the maturity value of the said policy was Rs. 1,68,762/- on 14.7.2010 and the OP has shown the surrender value of the said policy as Rs. 1,59,379/- after deducting 5% surrender charges. Further from the perusal of Reply of Legal Notice/ Letter dated 10.2.2011 (Annexure R-6) and Letter dated 11.10.2010 (Annexure R-5) it is clear that complainant has made request to release the maturity amount to the OP but the OP is forcing to give consent for Rs. 1,59,379/- after deducting 5% of surrender value. The only question involved in the present case is whether the OP can deduct the surrender charges of 5% after maturity of the policy or not?

11.                   We have gone through the terms and conditions of the policy in question placed on file Annexure R-6 and the Head   I ) of the policy is reproduced as under:-

SURRENDER VALUE

Policy once surrendered cannot be reinstated.

Surrender value will depend on the mode of payment (single/regular premium), duration of policy and no of premiums paid under the policy. The surrender value will be the bid value of units held in the policy holders’ unit account on the date of surrender charges as per rules.

The surrender charge will be as follows.

For Single Premium Policies	Surrender Charge
Duration from the date of commencement
Less than 1 year	4% of bid value
1 year or more but less than 2 years	2% of bid value.
2 years and more	Nil.

 

For Regular Premium Policies	Surrender charge
No. of premiums paid
Premiums paid for 1 year or less	60% of Bid Value
Premiums paid for more than 1 year but less than 2 years	40% of Bid Value
Premium paid for 2 years and more	Nil.

 

12.                   After going through the aforesaid terms and conditions of the policy, (Annexure R-6), it is clear that after (2) two years surrender charges are NIL. In the present case policy in question of the complainant remained in force for (5) five years, hence OP has no right to charge any surrender value.

13.                   The insurance companies in India with a view to escape and avoiding its legal and factual liabilities to make the payment of sum assured are fake acting in dramatically,  opposite of the principle of fair play and decency and in that series, it is not even caring that its wrong actions are causing wrongful losses to their customers. In the present case instead of acting fairly, the insurance company is trying to avoid its liability by making false pretext, which cannot be allowed to do so.

14                    As such, we are of the considered view that the OP has wrongly withheld the maturity amount of Rs. 1,68,762/- from 14.7.2010 of the complainant without any cogent reason and the OP is deficient and negligent in providing proper services to the complainant. Hence, the complainant is entitled for relief.

15.                   Resultantly we partly allow the complaint of complainant and direct the OP to pay a sum of Rs. 1,68,762/- as maturity amount to the complainant alongwith interest at the rate of 9% per annum from the date of filing of complaint till its realization and also to pay a sum of Rs. 5000/- as compensation for mental agony, harassment as well as litigation expenses. Order be complied within 30 days from the date of decision failing which complainant shall be entitled to invoke the jurisdiction of this Forum. Copies of this order be sent to the parties concerned free of costs. File be consigned to the record room after due compliance.

Announced in open court. 5.8.2015.

 

                                                                                  ( ASHOK KUMAR GARG )

                                                                                   PRESIDENT,

                                                                                     

 

                                                                                   (S.C.SHARMA )

                                                                                    MEMBER.