IN THE CONSUMER DISPUTES REDRESSAL COMMISSION, KOTTAYAM
Dated this the 28th day of December, 2022
Present: Sri. Manulal V.S. President
Sri. K.M. Anto, Member
C C No. 210/2018 (filed on 03-10-2018)
Petitioner : Harikrishnan G.
Karthika House,
Amara P.O.
Changanacherry,
Kottayam – 686546
(Adv. Nithin M.K.)
Vs.
Opposite parties : The Manager,
Life Insurance Corporation of India
Divisional Office,
P.B. No.609, Nagampadam
Kottayam – 686001.
(Adv. George Emmanuel Podipara)
O R D E R
Sri. K.M. Anto, Member
The Complaint is filed under section 12 of the consumer protection Act 1986.
The brief of the complainant’s case is as follows. The complainant had availed Jeevan Saral insurance policy with Policy No.393834987 from the opposite party on 26/09/2007.The policy was for a period of 10 years and maturity date of the policy fixed to be on 26/09/2017 with maturity value Rs.62,500/-.
The complainant had paid all the annual premiums for the entire period of 10 years. On 02/06/2017 the opposite party issued an apology letter stating that there is a typographical error in the policy document issued to the complainant in the maturity assured sum. They stated that as per the plan the complainant is eligible for the maturity sum assured Rs.27,890/- and only that amount will be payable to the complainant.
The complainant caused Lawyers Notice on 30/06/2017 to the opposite party. The opposite party caused a replay notice dated 06/07/2017 stating the conditions envisaged with regard to the policy and the calculation of the maturity amount. But the maturity sum assured payable to the complainant was given as Rs36, 257/-.It is clear from the policy document that both the death benefit claim amount and maturity sum assured amount is written as Rs.62,500/-.The opposite
party is liable to pay the balance assured maturity sum amount of Rs.62,500/- to
the complainant. The act of the opposite party is unfair trade practice and deficiency in service. Hence this complaint is filed.
On admission of the complaint copy of the complaint was duly served to the opposite party. The opposite party appeared and filed their version.
The version of the opposite party is as follows. LIC of India had issued a policy bearing No.393834987 on the life of the complainant under Jeevan Saral Plan for a term of ten years. The policy is issued for a Death benefit Sum assured at Rs.62500/- which is not the maturity sum assured. The date of commencement of the risk is on 26/09/2007 with maturity date of 26/09/2017.The complainant had paid all the due premiums. The Jeevan saral policy profits by way of loyalty additions declared by LIC. The policy holder is entitled for Death benefit sum assured along with loyalty addition on death during the term of the policy. Minimum monthly premium is Rs.250/- for persons up to the age of 49 and Rs. 400/- for persons having age of 50 years and above. In addition to Death coverage equal to 250 times monthly basic premium for all ages. Jeevan saral policy offers other benefits like auto cover, partial surrender, loan etc.
The maturity Sum ought to have found a place in the first line of column No.2 of the policy schedule. But it was inadvertently omitted to incorporate the maturity sum assured in the policy schedule while issuing the policy. The error was identified by LIC and have intimated to the complainant vide letter dated 02/06/2017. The life assured has remitted all premiums due under the policy and LIC has sent Discharge voucher intimating the maturity amount of Rs.36,257/-There is no deficiency in service on the part of the opposite party.
The amount of Rs.62,500/- shown in the policy is the Death benefit sum assured main plan and not the maturity sum assured. The complainant took the policy at the age of 20 and term opted is 10 years. As per the maturity chart, the maturity sum assured for 10 years term and age 20 is Rs11,156x2.5=Rs 27890/-.
The loyalty addition for 10 years is Rs300/- for every assured maturity sum of
Rs1000/-. The Loyalty addition for Rs.27,890/-=27890x3000/1000=Rs.8,367/-.
Thus the total amount payable on maturity is Rs.36,257/-. The policy holder is not entitled to get Rs.62,5 00/- as maturity amount as claimed by the complainant. There is no deficiency in service on the part of the opposite party.
The complainant filed proof affidavit and marked documents as Exhibits A1 to A6.Opposite party filed proof affidavit. Opposite party examined witness as DW1 and marked documents B1 to B6.
On the basis of the complaint, version of the opposite party and evidence
adduced we would like to consider the following points.
(1) Whether there is deficiency in service on the part of the opposite party
(2) If so what are the reliefs and costs?
For the sake of convenience we would like to consider point no 1 and 2 together.
Point 1 and 2
Ongoing through the complaint, version of the opposite party and evidence on record it is clear that the complainant had availed a Jeevan saral insurance policy from the opposite party vide Policy No.393834987 on 26/09/2007.The policy was for a period of 10 years with date of commencement of risk on 26/09/2007 and date of maturity on 26/09/2017,
Ext A2 is the letter from the opposite party to the complainant dated 02/06/2017 intimating that the opposite party noticed that there occurred an inadvertent typographical error in the maturity sum assured which has been shown as Rs……….. And as per the plan the correct maturity sum assured is Rs.27,890/-and all other terms and conditions remain unaltered.
Ext B5 is the Bonus chart valuation giving the Loyalty addition payable on maturity/Death/Surrender per Rs.100/- monthly premium maturity sum assured for the corresponding duration for which the policy is in force provided that atleast 10 full years premiums have been paid-Jeevan saral (plan 165). The annual premium band for determining loyalty addition shall be arrived at on the basis of monthly basic premium. As per this the loyalty addition for duration of 10 years up to 5000 is 300.
Ext B6 is the Annexure -1 chart giving the maturity sums assured per Rs.100 per month basic premium for different age at entry and term. This Annexure-1 chart is part of the jeevan saral (Table No.165) policy document.
The Counsel of the opposite party produced judgments in appeal No 17/2017 of the Karnataka state consumer disputes Redressal commission, Bangalore, Life Insurance Corporation vs. Arjun. Hon’ble State Commission allowed the appeal on the ground that the mistake regarding the maturity value was crept in because of manual typing and that the same was delivered to the complainant.
The counsel of the opposite party also produced the judgment in Revision Petition No.1240/2008 of NCDRC in Amarendrakumar Roy Vs LIC of India with regard to Jeevan suraksha policy and the judgment of Supreme court in Chandulal Harijivandas V Commissioner of Income tax1967 KHC 580 Supreme court.
However the facts of the above decisions were different from the case in hand.
On a careful evaluation of facts of this case it is evident that the complainant had availed the policy on 26/09/2007 for a period of 10 years and about three months before completing the policy period, on 02.06.2017 the opposite party issued Ext A2 intimation to the complainant. In Ext A2 it is stated that “We have noticed in the issued policy document there has been an inadvertent typographical error in the maturity sum assured, which has been shown as Rs…. .As per the plan the correct maturity assured is Rs.27890/-. All other terms and conditions remain unaltered”.
Hon.’ble High court of Kerala on 19th September 2017 in W PC No.7128/ 2016 along with WPC No.7754/2016 and connected cases in WPCNo.8982/2016,
WPCNo.12959/2016,WPCNo.13650/2016,WPCNo.18748/2016,WPCNo.28989/20 16, WPCNo.21888/2016 and WPC No.21889/2017 of LIC of India held that
“4. Learned counsel for the respondents contended that the policies in question were taken in 2004 and the alleged mistake had been pointed out by the LIC for the first time in September 2015. It is contended that in a contract of insurance once the contract is concluded, the insurer cannot repudiate the same after more than a decade on the ground that there was some error in the facts and figures shown in the policy document. The leaned counsel relies on a decision of a Division Bench of this in Abubacker v. L.I.C of India [1983 KLT 492], to contend that no insurer can dispute any policy issued by it after two years of it's issue in terms of Section 45 of the Insurance Act, 1938 in cases except where there is suppression or misrepresentation by the insured on material facts. The learned counsel also relied on a decision of the Santosh Kumar WP(C).7128/16 5 Gupta v. Indian Life Insurance Corporation [2000 KHC 4077] to contend that going by Section 45 of the Insurance Act, 1938, the policy cannot be called in question by the insurer on the ground of any mistake after the lapse of two years from the date on which it was effected.
5. In the instant case, it is clear that the policies are issued in the year 2004 or immediately thereafter. The conditions contained in Exhibit P1 are in the nature of an intra organisational communication. The petitioner has no case in these writ petitions that the table appended to Exhibit P1 was ever made available to the party respondents or that the calculation on which maturity sum assured would be payable had been explained to them. In the absence of any material to show such intimation, the LIC would be bound by the facts and figures as contained in Exhibit P2 document. As noticed earlier, the correction of the conditions of policy was made known to the party respondents only after an interval of nearly 11 years.
These facts have been taken note of by the Ombudsman as also the Permanent Lok Adalath for directing the payment of the amounts due as maturity benefit to the party respondents”
On the basis of the above findings it is clear that the complainant took the policy on 26.07.2007 and Ext A1 policy documents were served to the complainant by the opposite party. The correction of the conditions of the policy was made known to the complainant only on 02.06.2017, just three months before completing the 10 year period. The opposite party has no case that the Tabulation details vide Ext B6 document was made available to the complainant along with Ext A1 Policy Documents or that the complainant was taught the calculation on which the maturity sum assured would be payable had been explained to the complainant. More over the opposite party claimed that the space provided for entering the maturity value in column No.2 of Ext A1 Policy document was kept blank contrary to the Ext A2 letter citing typographical error in the policy document.
DW1 who is the regional manager of the opposite party deposed that “A1 {]Imcw Sn tImf¯n ]dªn«pÅ heads  DÅ hnhc§Ä GXns\ms¡bmsW¶v a\knem¡m³ km[n¡ptam(Q) Spacing h¨v am{Xta a\knemIq (A) km[mcW policy holder ¡v a\knem¡m³ km[n¡ptam(Q) (Court Question) Xncn¨dnbm³ _q²nap«mWv.(A)”
The complainant cannot be held liable if he understands and believes that the maturity amount given under column No.2 in Ext A1 document is the Maturity value. The act of the opposite party in issuing the policy without giving all the details of the policy conditions and tabulations to the complainant and there by obtaining premium for 10 years is Unfair trade practice on the part of the opposite party. The act of the opposite party in not providing the promised Maturity amount to the complainant is deficiency in their service. As per Ext A1 Policy document the complainant is eligible for the maturity amount along with loyalty addition on the date of maturity of the policy. Hence point No 1 and 2 are found in favor of the complainant. We allow the complaint and pass the following orders.
- The opposite party is directed to pay Rs.81,250/- with 9% interest p.a from 26/09/2017 till the date of realization.
- The opposite party is directed to pay Rs.10,000/- being the compensation for the sufferings and hardships with cost Rs.3000/-.
The order shall be complied within 30 days from the date of receipt of the copy of this order. If not complied as ordered the amounts will carry 6% interest per annum till realization.
Pronounced in the Open Commission on this the 28th day of December, 2022
Sri. K.M. Anto, Member Sd/-
Sri. Manulal V.S. President Sd/-
Appendix
Witness from the side of Opposite party
Dw1 - George CD
Exhibits marked from the side of complainant
A1 – Copy of LIC’s Jeevan Saral (With profits)
A2 – Copy of letter dtd.02-06-17 by opposite party to complainant
A3 – Lawyers notice dtd.30-06-17 by Adv. Nithin M.K. to the opposite party
A4 – Reply letter dtd.06-07-17 by opposite party to Adv. Nithin M.K.
A5- Postal receipt
A6 – Postal acknowledgement card
Exhibits marked from the side of opposite party
B1 – Copy of proposal form
B2 - Copy of LIC’s Jeevan Saral (With profits)
B3 –Copy of letter by opposite party to complainant
B4 – Copy of maturity information letter
B5 – Copy of maturity tabulation chart
B6 - Copy of maturity tabulation chart
By Order
Sd/-
Assistant Registrar
