Manpreet Singh filed a consumer case on 11 Jan 2024 against Metlife Insurance Co. in the Ludhiana Consumer Court. The case no is CC/19/363 and the judgment uploaded on 12 Jan 2024.
DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION, LUDHIANA.
Complaint No:363 dated 25.07.2019. Date of decision: 11.01.2024.
Of Sikander Singh S/o. Kartar Singh, R/o. Village Gondwal, Tehsil Raikot and Distt. Ludhiana...…Complainants
Versus
Complaint Under Section 12 of the Consumer Protection Act, 1986.
QUORUM:
SH. SANJEEV BATRA, PRESIDENT
SH. JASWINDER SINGH, MEMBER
MS. MONIKA BHAGAT, MEMBER
COUNSEL FOR THE PARTIES:
For complainants : Sh. B.S. Gill, Advocate.
For OPs : Sh. Sudhir Gakhar, Advocate.
ORDER
PER SANJEEV BATRA, PRESIDENT
1. Briefly stated, the facts of the complaint are that the complainants are the legal heirs and nominee of L. Sikander Singh S/o. Kartar Singh, R/o. Village Gondwal, Tehsil Raikot and Distt. Ludhiana, who was owner of Metlife Insurance Policy No.20808537 having Met Monthly Income Plan for term of 5 years. The policy term was 20 years with premium amount of Rs.97,37,138/-. Sikander Singh regularly paid the installments of premium against the receipts issued by OPs office bearer. The complainants stated that Sikander Singh died on 02.05.2017 leaving behind them as his legal heirs. After death of Sikander Singh, the complainants approached the OPs with request to pay all the benefit of said policy. Even they were ready to get deposit any amount or installment left being unpaid by Sikander Singh but the OPs failed to satisfy them and no payment has been paid by the OPs under the benefit of the said policy. The act and conduct on the part of the OPs amounts to deficiency in service and unfair trade practice due to which the complainants have suffered mental and physical harassment and have also suffered huge financial loss. The complainants a served legal notice dated 22.04.2019 upon the OPs but they have failed to make the payment and even did not give reply to the notice. Hence this complaint whereby the complainants have prayed for issuing directions to the OPs to pay the benefit of policy No.20808537 and also to pay litigation expenses of Rs.55,000/- and compensation of Rs.5,00,000/-.
2. Upon notice, the OPs appeared & filed written statement.
3. Thereafter, the OPs filed application for amendment of written statement, which was allowed vide order dated 18.10.2023 subject to costs of Rs.2000/-.
In the amended written statement, the OPs assailed the complaint by taking preliminary objections on the ground of maintainability; the complaint being hopelessly time barred; concealment and suppression of material facts etc. The OPs stated that the policy under which the claim was raised had already been lapsed since 31.03.2014 due to non-payment of renewal premium whereas Late Sh. Sikander Singh was died on 02.05.2017. At the time of his death, the policy was not in existence. The OPs further stated that the complaint is hopelessly time barred as the claim under the policy was repudiated vide letter dated 05.06.2017 whereas the present complaint has been filed on 25.07.2019 after lapse of more than two years from the date of repudiation of claim.
On merits, the OPs reiterated the crux of averments made in the preliminary objections. However, the OPs stated that on the basis of proposal form and other documents, they issued a policy No.20808537 to Sh. Sikander Singh along with terms and conditions governing the policy and a welcome letter. Complainant No.1 Manpreet Singh was the nominee under the policy. According to the OPs, the deceased Sikander Singh also having one another policy bearing No.20830157 (Plan Met Smart One), which the deceased obtained loan of Rs.77,216.18 and the said amount was transferred in his bank account on 03.05.2016. The OPs received claim intimation under both the policies. As the policy No.20808337 was lapsed since 31.03.2014 due to non-payment of premium and as such, the claim was repudiated vide letter dated 05.06.2017 whereas under the policy No.20830157 the admissible sum assured of Rs.2,50,000/- was paid to the complainant in July 2017 and intimation was duly given vide letter dated 10.07.2017.
The OPs further stated that the policy in question was proposed in April 2012 and at the time of proposing the policy, Sikander Singh paid the amount of Rs.97,500/- on 03.04.2012 and the 2nd premium of Rs.97,387/- was paid on 12.03.2013. Thereafter, Late Sh. Sikander Singh did not paid the renewal premium falling due in March 2014 and consequently the policy was lapsed on3 1.03.2014 due to non-payment of premium. The OPs further stated that on 24.05.2017, they received claim intimation regarding death of Sikander Singh due to Cardiac Arrest on 03.05.2017. The claim was lodged regarding policies No.20830157 and 20808537 by complainant No.1 Manpreet Singh, who was nominee under the policy. On receipt of intimation, the claim was evaluated and it was found that the policy was already lapsed since 31.03.2014 due to non-payment of premium. The claim was repudiated vide letter dated 05.06.2017. However, under the policy No.20830157, the admissible sum assured of Rs.2,50,000/- was paid to the complainant in July 2017 and intimation was duly given vide letter dated 10.07.2017. The complainants had not disclosed this fact in the complaint. Only two premiums under the policy No.20808537 were received and the policy was lapsed since 31.03.2014. As such, no amount was payable under the said policy as per Section 4.4 of the terms and conditions of the policy as per which the insured was required to pay at least three full year’s regular premium. The OPs have denied that there is any deficiency of service and has also prayed for dismissal of the complaint.
4. The complainant filed replication to the amended written statement reiterated the facts mentioned in the complaint and controverted those mentioned in the written statement.
5. In support of their claim, complainant No.3 tendered her affidavit Ex. CA in which she reiterated the allegations and the claim of compensation as stated in the complaint. The complainants also tendered documents Ex. C1 is the copy of bank account statement of Sh. Sikander Singh, Ex. C2 is the copy of policy documents, Ex. C3 is the copy of legal notice, Ex. C4 are the postal receipts, Ex. C5 is the copy of death certificate of Sikander Singh and closed the evidence.
6. On the other hand, the counsel for the OPs tendered affidavit Ex. RW-1 of Sh. Manoj Thakur, Senior Manager Legal, PNB Metlife India Insurance Company Limited, Branch Office, Lodhi Tower, Ist Floor, The Mall, Ludhiana along with documents Ex. R1 is the copy of policy documents and closed the evidence.
7. We have heard the arguments of the counsel for the parties and also gone through the complaint, replication affidavit and annexed documents and amended written statement along with affidavit and documents produced on record by both the parties.
8. Admittedly, one Sikander Singh, father of complainants No.1 and 3 and husband of complainant No.2 was holder of policy Ex. C2 = Ex. R1, the detail of which is reproduced as under:-
Policy Name | Met Monthly Income Plan |
Policy No. | 20808537 |
Policy Issue Date | 19.04.2012 |
Proposer | Sikander Singh |
Life Assured | Sikander Singh |
Premium amount | Rs.97,371.98 |
Sum Assured | Rs.5,40,000/- |
Mode | Annual/Yearly Mode |
Policy Term | 20 Years |
Premium Term | 5 Years |
Unfortunately, Sikander Singh died on 02.05.2017. His death certificate is Ex. C5. Although the term of the policy was for 20 years, but premium paying term was for 5 years. Sikander Singh paid premium for first two years only i.e. amount of Rs.97,500/- on 03.04.2012 and the 2nd premium of Rs.97,387/- on 12.03.2013 but during his life time, Sikander Singh could not pay the subsequent renewal premiums and due to which in March 2014, the policy was declared lapsed. Complainant No.1 being the son and the nominee of the deceased Sikander Singh preferred a claim in June 2015. However, the OPs vide letter dated 05.06.2017 (produced on record by the OPs) refused to accept the liability under the policy. The operative part of the repudiation letter is reproduced as under:-
“We have evaluated your claim and regret to bring to your attention that the above mentioned policy has lapsed since 31/03/2014 due to non-payment of renewal premium. Since the unfortunate demise of Mr. Sikander Singh has occurred after the policy had lapsed, we regret to inform you that we are unable to accept any liability under the above policy, as per the terms and conditions of the above referenced policy.”
9. Now the issue for consideration arises whether the repudiation of the claim by the OPs was justified or not?
10. There is a clause section 4.4 of the terms and conditions of the policy Ex. C1 = Ex. R2 which requires a holder of the policy to pay at least three full years regular premium for attaining eligibility for non-forfeiture or surrender value benefit. The relevant clause 4.4 reads as under:-
“4.4 Non-Forfeiture options upon Non-Payment of Regular Premiums
If all Regular Premiums have been paid for at least three (3) full Policy Years and any subsequent premium is not duly paid, you shall have the following options:
If the Regular Premiums for at least three full years have been paid and no further due premiums are paid, then the Policy will be eligible for a non- forfeiture benefit. The non-forfeiture benefit will be a Reduced Paid Up Policy ("Reduced Paid-up Insurance"). The amount of the Reduced Paid-up Insurance shall be determined by multiplying the Basic Sum Assured with the ratio of the number of Regular Premiums paid to the total number of Regular Premiums payable during the Premium Payment Term. The Guaranteed Monthly Regular Income payments will then become the Reduced Paid Up Value divided by 180 and the same will be payable as Survival Benefit. In case of death of the Person Insured an additional payment of 25% of the Reduced Paid- Up Value will be paid together with the accrued Simple Reversionary Bonus. If the reduced monthly income is less than Rs. 1000, then the Survival Benefit will be paid on a yearly basis. The Reduced Paid-up Insurance is not eligible for any future Simple Reversionary Bonuses and Terminal Bonus.
Or
If the Regular Premiums for at least three full years have been paid, the Policy acquires a Surrender Value as set out in Section 4.5. Instead of continuing with the Policy the same may be surrendered for its Surrender Value. Upon Payment of the Surrender Value, the Policy terminates and all other benefits payable by the Company under the Policy shall cease.”
The close scrutiny of the said cause shows that only in cases where a regular premium for 3 years has been paid then only the policy can be converted into a reduced paid up insurance policy or its surrender value can be paid. Even during his life time, deceased insured Sikander Singh had an opportunity to get the policy reinstated by invoking section 4.3 of the policy and by paying outstanding regular premium along with applicable charges, if any, but he did not apply for the same. Rather the deceased has chosen to accept an amount of Rs.77,216/- on 03.05.2016 as reflected in the statement of account Ex. C1 being admissible sum assured of Rs.2,50,000/- in another policy No.20830157, which also lapsed on 31.03.2014. This also implies that during his life time, the deceased had conscious knowledge that both the policies obtained by him have lapsed due to non-payment of renewal premium. So the repudiation of the claim of the complainant by the OPs vide letter dated 05.06.2017 is justified. As such, in the given set of facts and circumstances, the complaint deserves dismissal.
11. As a sequel of above discussion, the complaint is hereby dismissed. However, there shall be no order as to costs. Copies of order be supplied to parties free of costs as per rules. File be indexed and consigned to record room.
12. Due to huge pendency of cases, the complaint could not be decided within statutory period.
(Monika Bhagat) (Jaswinder Singh) (Sanjeev Batra) Member Member President
Announced in Open Commission.
Dated:11.01.2024.
Gobind Ram.
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