ORDER

Gulshan Prashar (Member)

1. Brief facts of the case are that the complainant took policy bearing No.480034867 dated 16.7.2008 from the respondents on the life of his minor grand son of Master Manveshjit Singh in the sum of Rs.2,00,000/- effective from 31.7.2008 for 20 years on the annual premium of Rs.10,000/-. The payment of Rs.10,000/- was made on 16.7.2008 by cross cheque of HDFC Bank, Kapurthala to the representative of the respondents who had visited his residential

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house for the purpose of insuring his grand son.

2. He received telephone call from the respondent No.2 that he should deposit premium in the sum of Rs.10,000/- in January, 2009 and the complainant deposited the said amount with respondent No.2 in cash on 29.1.2009. He protested to respondents that he was required to pay Rs.10,000/- yearly which becomes due inJuly, 2009 but the officials said that he should deposit the mount because the respondent No.1 has directed to make payment. They further said to the complainant they they will refund Rs.60,000/- to the complainant after three years.

3. That the complainant again received telephone call from the respondent No.2 that he should deposit premium in the sum of Rs.10,000/- in August, 2009 and the complainant deposited the said amount with respondent No.2 in cash on 27.8.2009 and in this way the respondents received Rs.30,000/-from the complainant. It is alleged that complainant had got the said policy on yearly payment of Rs.10,000/- but the respondent later on received Rs.10,000/- more after six months on the plea that Rs.60,000/- will be paid to him after three years. He requested the respondents that they should give him in writing that Rs.60,000/- will be paid paid to him after three years but they did not do so.

4. That when he received the original policy from the respondents, he was astonished to note that the premium of Rs.10,000/- was to be paid by Semi Annual. It may be mentioned here that the complainant has obtained the policy of Rs.2,00,000/- for 20 years and the premium amount was to be paid yearly of

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Rs.10,000/- but the policy shows that the complainant was required to pay Rs.20,000/- yearly as premium for the sum assured of Rs.2,00,000/-. If the complainant pays Rs.20,000/- years for 20 years, then the amount of Rs.4,00,000/- will be received by the respondent but the policy shows Rs.2,00,000/- and this shows that the respondents adopted unfair trade practice and have received Rs.30,000/- for 1½ years whereas they should have received Rs.10,000/- yearly from the complainant. The respondents told that the Regional Manager will approach him, who will rectify the policy but nobody has approached him in this respect so far. This act of the opposite parties is deficiency in service on their part. Hence this complaint.

5. Notice of the complaint was issued to the opposite parties who appeared through their counsel and filed written statement taking as many as six preliminary objections. On merits, the opposite parties refuted each and every point raised in the complaint.

6. The counsel for the complainant has tendered into evidence affidavit Ex.CA along with documents Ex.C1 to Ex.C6 and closed the evidence.

7. On the other hand the opposite parties tendered into evidence affidavit Ex.OA along with documents Ex.O1 to Ex.O10 and closed the evidence.

8. We have heard learned counsel for both the parties. It is admitted fact of both the parties that the complainant took policy on 16.7.2008 from the opposite parties and the life of his minor grand son Master Manveshjit Singh was insured for the sum of Rs.2,00,000/- with effect from 31.7.2008 for 20 years and the

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complainant was informed that he would pay an annual premium of Rs.10,000/- and the complainant paid the first installment on 16.7.2008. At the time of payment of first premium on 16.7.2008, the policy documents were not supplied to him and the terms and conditions of the policy were not explained by anybody to the complainant. The whole matter was decided orally and the complainant was told that he has to pay the annual premium of this insurance policy at the rate of Rs.10,000/-. After receiving a telephone call from the opposite parties, the complainant deposited the second installment of premium of Rs.10,000/- in January, 2009 and after six months, he was again directed to pay a sum of Rs.10,000/- more in August, 2009.

9. When the complainant received the original policy, he was shocked to note that the premium of Rs.10,000/- was to be paid twice in a year and the complainant has obtained this Life Insurance Policy for his grand son for 20 years and the amount of the insurance policy was Rs.2,00,000/-. The counsel for the complainant argued that if the complainant is to pay Rs.20,000/- yearly for 20 years, then an amount of Rs.4,00,000/- will be paid by the complainant to the opposite parties but the policy shows Rs.2,00,000.0 as matured value.

10. The counsel for the complainant further argues that the opposite parties adopted unfair trade practice and had received a sum of Rs.30,000/- within 1½ years, whereas they should have received Rs.10,000/- yearly as per the agreement explained to the complainant by the representative of the opposite parties orally. The

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person who approached the complainant and explained him the entire facts of the policy is the representative of the opposite parties. We have also perused the policy the documents supplied to the complainant which are Ex.C2 to Ex.C6. The proposer and the policy holder is Gurnam Singh complainant and vide this policy, the life of grand son of complainant was insured for Rs.2,00,000/- and the date of birth of the assured is 12.8.2006 and the term of the policy is 20 years and the date of payment of last installment is mentioned as 31.1.2028 and if the complainant continued to pay the premium at the rate of Rs.20,000/- per year what he will get at the time of maturity of this policy on 31.1.2028 is not mentioned any where. The representative of the opposite parties of issuing the policy fully knows the age of complainant Gurnam Singh and only due to the old age of the policy holder/proposer that the life of Gurnam Singh was not assured by the opposite parties. In fact, this policy was a fixed deposit scheme for 20 years. At the time of taking the policy, the age of the complainant was about 74 years and he cannot lead an active life for another 20 years and after some years it would be very difficult for him to pay Rs.20,000/- per annum and the life on his grand son is insured in this policy and his date of birth is 12.8.2006, it means for another 20 years will not be able to know the meaning and the benefits of a life insurance policy. He will not be an earning hand for next 20 years, so he will not be able to pay the premium on this policy. So neither the complainant, nor his grand son are in a position to wait for the maturity of this policy. On the other hand, the counsel for the opposite parties argues that the opposite parties has

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explained each and every point to the complainant at the time of purchasing of the policy and the opposite parties has invested the entire amount in the units from where the opposite parties and the complainant can hope for a handsome return. The income from the units are not fixed income, so the opposite parties was not in a position to mention the exact amount payable to the complainant at the time of maturity after 20 years. The opposite parties has already invested Rs.30,000/- in the purchase of units of some renowned establishment and the opposite parties are earning good amount as interest.

So in the end, we are of the view that the entire policy and its documents were not read over and explained to the complainant by the representative of the opposite parties at the time of issuing this policy and the representative of the opposite parties had not narrated true and actual facts to the complainant because a person of 74 years will not purchase a policy having maturity date after 20 years.

So we direct the opposite parties to refund the entire amount of Rs.30,000/- to the complainant along with interest @ 8% per annum from the date of deposit of three installments by the complainant till realization, besides Rs.10,000/- as costs of the complaint, within one month from the receipt of the copy of the order.

Copy of the order be sent to the parties through registered post free of costs. File be consigned to the record room.

Dated: Gulshan Prashar Paramjit Singh

19.5.2010 Member President