BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM

VAZHUTHACAUD, THIRUVANANTHAPURAM.

PRESENT

SRI. G. SIVAPRASAD : PRESIDENT

SMT. BEENAKUMARI. A : MEMBER

SMT. S.K.SREELA : MEMBER

O.P. No. 318/2004 Filed on 12.08.2004

Dated : 31.08.2009

Complainants:

1. Khadeeja Beevi, Taj Bhavan, Kudappanamoodu P.O, Amboori, Neyyattinkara.

    

2. Shammy Anwar, D/o Khadeeja Beevi, residing at -do-

    

3. Minnu Anwar, D/o Khadeeja Beevi, residing at -do-

    

4. Ahamed Hassan residing at -do- -do-

(By adv. Anayara K.S. Prakash)

Opposite parties:

1. Nirmal Anwar, S/o Mumtaz Beegom, Thodiyoor, Karunagappally, Kollam (minor represented by his natural guardian Mumtaz Beegom).

    

2. Muhammed Ammal, T.C 19/338(2), Thirumala, Thiruvananthapuram.

    

3. Insurance Director, Kerala State Insurance Department, Thiruvananthapuram.

    

4. State of Kerala represented by Chief Secretary.

(By adv. Paraniyam Devakumar)

This O.P having been heard on 30.07.2009, the Forum on 31.08.2009 delivered the following:

ORDER

SRI. G. SIVAPRASAD: PRESIDENT

The facts leading to the filing of the complaint are that Dr. Anwar Hussain, son of the 4^th complainant and 2^nd opposite party, is the husband of the 1^st complainant and father of 2^nd and 3^rd complainants and 1^st opposite party. Dr. Anwar Hussain joined a state insurance scheme on 22.04.1991 by remitting a monthly premium of Rs. 60/- and obtained a policy certificate No. TVM/105317/1991 from the 3^rd opposite party for an amount of Rs. 13,980/-. Dr. Anwar Hussain died on 10.07.2002. He paid Rs. 60/- as first monthly premium for the month of April 1991. He was bound to remit premium from May 1991 to May 2010 or until his death. After taking the policy the deceased paid the policy premium for 5 months and thereafter he went for higher studies with the permission of Director of Insurance, Medical Services, Thiruvananthapuram. After completing his higher studies, from September 1997 onwards he regularly paid the policy premium till his death. As per the policy the legal heirs of the policy holder are entitled to get the assured amount. After the death of Dr. Anwar Hussain 1^st complainant approached the 3^rd opposite party for getting the policy benefit, but opposite party purposefully evaded from their duties. 3^rd opposite party issued a letter bearing No. SLI/L2/924/04 stating that 1^st complainant is entitled to get a sum of Rs. 1,960/- and 1^st and 2^nd opposite parties are entitled to get a sum of Rs. 490/- each. There is dereliction of duty, negligence, misleading representation and deficiency of service on the part of the 3^rd opposite party and 3^rd opposite party duty bound to repay the total amount assured. Hence this complaint to direct the 3^rd opposite party to pay 4/6 of the total sum assured + bonus to complainants and Rs. 25,000/- towards compensation.

Opposite parties 1 & 2 remained exparte. No version filed. 3^rd and 4^th opposite party entered appearance and filed version contending that as per the State Life Insurance Records Dr. Anwar Hussain joined the State Life Insurance Scheme on 22.04.1991. Subsequently he had been issued a policy certificate on 24.04.1991 in which it was specifically stated that the remittance of Rs. 60/-made on 22.04.1991 had been adjusted as the first premium of the policy. As per the conditions of the policy contract, he was bound to subscribe at the rate of Rs. 60/- in every subsequent month commencing with the month of May 1991 till his retirement in May 2010 or till his death whichever shall first over. Director of Insurance has got nothing to do with granting permission to a subscriber for availing leave without allowance that Dr. Anwar Hussain subscribed towards the State Life Insurance Scheme regularly only for five months upto 08/91 and no subscription was made for the period from 09/91 to 09/97. As per Rule 20(3) of Kerala State Life Insurance Rules, the policy will lapse if there is no payment of premium for a continuous period of 6 months and all claims to the policy thereunder shall be forfeited subject to the condition in Rule 20(4) which demands at least three years regular subscription of premium before the date of lapse so that it will secure a paid up value. Dr. Anwar Hussain had not renewed his lapsed policy as per the provision laid down in Rule 21(1). Since policy remains a lapsed one, the legal heirs of Dr. Anwar Hussain are eligible only for actual amount remitted by him that is Rs. 2,940/- and the same has already been informed to them by the department. Hence opposite parties 3 & 4 prayed for dismissal of the complaint.

The points that arise for consideration are:-

1. Whether complainants are entitled to get 4/6^th of the total sum assured?

2. Whether there is deficiency in service on the part of opposite parties?

3. Whether complainants are entitled to get compensation and costs? If so, at what amount?

In support of the complaint, 1^st complainant has filed proof affidavit and Exts. P1 to P7 were marked. Opposite parties 1 & 2 did not turn up, nor did opposite parties 1 & 2 file version or affidavit. Opposite parties 3 & 4 have no oral evidence, but Exts. D1 to D6 were marked.

Points (i) to (iii):- Admittedly, Dr. Anwar Hussain joined the State Insurance Scheme on 22^nd April 1991 by remitting a monthly premium of Rs. 60/- and obtained policy certificate No. TVM/105317/91 on 24.04.1991 from the 3^rd opposite party. It has been the case of the complainant that the said Anwar Hussain died on 10.07.2002, that at the time of his death he was working as an Assistant Surgeon in Taluk Hospital, Neyyattinkara, that after taking the aforesaid policy, Dr. Anwar Hussain paid policy premium (Rs. 60/- per month) for five months, and thereafter he went for higher studies and after completing his higher studies, from September 1997 onwards, he regularly paid the policy premium till his death. It has also been the case of the complainants that as the legal representatives of the said deceased, complainants approached the 3^rd opposite party for policy benefits, but 3^rd opposite party was reluctant to perform his duty. Ext. P1 is the copy of the policy certificate issued by the 3^rd opposite party in the name of Dr. Anwar Hussain. As per Ext. P1 the sum assured is Rs. 13,980/-, the date of the policy is 24.04.1991, the monthly premium is Rs. 60/-. As per Ext. P1 the policy holder has to remit the monthly premium in every subsequent month commencing with the month of May 1991 and ending with the month of May in the year 2010 or until his death, whichever shall first occur, in the manner prescribed in Rules. Ext. P2 is the copy of the letter dated 09.06.2004 issued by the 3^rd opposite party to 1^st complainant and 2 others, which is with respect to policy No. 36809. Ext. P3 is the copy of the Death Certificate issued by the Registrar of Birth & Death. As per Ext. P3, the date of death of Dr. Anwar Hussain is on 10.07.2002. Ext. P4 is the photocopy of the Statement of Account in respect of Dr. Anwar Hussain towards SLI premia remittance issued by the treasury officer. As per Ext. P4 the policy holder remitted monthly premium from 04/91 to 08/91, thereafter no premium remitted till 08/97, again started to remit premium from 9/97 to 06/02 on 02/00, while there was default in remittance on 02/00, 05/00 and 11/00. Altogether as per Ext. P4 the policy holder had remitted Rs. 3240/-. Ext. P5 is the copy of the legal heirship certificate dated 15.09.2003 issued by the Tahsildar, Neyyattinkara. As per Ext. P5 complainants and opposite parties 1 & 2 are the legal heirs of the deceased Dr. Anwar Hussain. Ext. P7 is the letter dated 14.01.2004 from the District Insurance Officer to the Director of Insurance. Ext. D1 is the copy of the Insurance Rules. Ext. D2 is the copy of the Premium Receipt Book with directions to policy holders. Ext. D3 is the copy of the Government Order dated 12.01.2004. Ext. D4 is the copy of the Government Order dated 29.04.1999. It has been contended by 3^rd opposite party that 3^rd opposite party is a service oriented Government machinery functioning without any profit motive and ensuring the security of the service personnel, that 3^rd opposite party functions under the Rules and Regulations promulgated by the Government of Kerala time to time. Submission by the 3^rd opposite party is that, the policy of the deceased Dr. Anwar Hussain was a lapsed policy by reasons alleged in Rule 20(3) of the Kerala State Life Insurance Rules; that mode of revival of lapsed policy was also provided in Rule 21 of the said Rule. According to 3^rd opposite party very important Rule govern upon this issue is Rule 20(5). At this juncture it will be appropriate to read the said Rules as under:

Rule 20(3): In every other case of non-recovery or non-payment of premium for a period of 6 months, the policy shall lapse as from from the due date of defaulted premium and all claims to the policy moneys thereunder forfeited subject to the relevant Rules 20(4).

Rule 20(4):- A lapsed policy on which at least three years premia have been duly paid up assurance for a reduced sum which will bear the same proportion to the original sum assured as the total amount of premium paid bears the amount payable if the original policy continued in force until the assured attained his 55^th year of age. A claim arising within six months from the date of lapse of such policy, will however be treated as good and will be paid in full subject to the deduction of ordinary revival charges specified in rule 21.1.

Rule 20(5):- A lapsed policy on which three year premia have not been paid before the date of lapse shall be void and no claim on it will be recognised.

Rule 21: A lapsed policy may be revived on payment of all arrears of premium with compound interest calculated from the 1^st due date to the date of payment at 9% per annum. Such revival should be done with a period of three years from the date of lapse of policy.

Submission by the 3^rd opposite party is that the policy of the deceased Dr. Anwar Hussain was a lapsed policy by reasons alleged in Rule 20(3), that the policy was not revived as provided in Rule 21. According to the opposite party, the above matter was conveyed to the deceased through printed instructions on the Premium Receipt Book (Ext. D2) and Insurance Policy (Ext. P1). On going through the evidence available on records, it is obvious that the deceased Dr. Anwar Hussain had paid regular premium only for five months prior to the lapse of the policy. It is further to be pointed out that the deceased being a Gazetted Officer, he ought to have conversant with the rules and directions contained in the Premium Receipt Book and Insurance Policy and KSLI Rules. It is pertinent to be pointed out that the deceased had not remitted the premium from 09/91 to 08/97, thereby the policy is seen lapsed and as under Rule 20.5 a lapsed policy on which three years premia have not been paid before the date of lapse shall be void and no claim on it will be recognised and further as under rule 21, the lapsed policy could be revived on payment of all arrears of the premia with compound interest within a period of three years from the date of the lapse of policy. The lapsed policy not revived by the deceased even though he had been in service for around five years before his death as required under Rule 21. Hence the claim of the complainants cannot be considered as such. In view of foregoing discussions, we are of the considered opinion that the legal heirs of the deceased Dr. Anwar Hussain are eligible only for the actual amount remitted by the deceased. 3^rd opposite party already intimated the complainant about the decision on claim (by Ext. P2) before filing the complaint. Hence we find there is no deficiency on the part of opposite party.

In the result, complaint is partly allowed. The 3^rd opposite party shall pay a sum of Rs. 3,240/- to the legal heirs of the deceased Dr. Anwar Hussain towards the actual amount of premium remitted by the deceased. There is no compensation in facts and circumstances of the case. Both parties shall bear and suffer their costs.

A copy of this order as per the statutory requirements be forwarded to the parties free of charge and thereafter the file be consigned to the record room.

Dictated to the Confidential Assistant, transcribed by her, corrected by me and pronounced in the Open Forum, this the 31^st day of August 2009.

G. SIVAPRASAD,

President.

BEENAKUMARI. A : MEMBER

S.K. SREELA : MEMBER

O.P. No. 318/2004

APPENDIX

I COMPLAINANT'S WITNESS :

NIL

II COMPLAINANT'S DOCUMENTS :

P1 - Photocopy of policy certificate bearing No. 105317/08.

P2 - Photocopy of letter dated 09.06.2004 issued by the Kerala

State Insurance Department.

P3 - Photocopy of Death Certificate dated 09.08.2002.

P4 - Photocopy of statement of accounts.

P5 - Copy of Legal Heirship Certificate dated 16.09.2003 issued

by Taluk Officer, Neyyattinkara.

P6 - Letter dated 09.06.2004 issued by the Insurance Director to

the complainant.

P7 - Copy of letter dated 14.01.2004 issued from the District

Insurance Officer to the Insurance Director.

III OPPOSITE PARTY'S WITNESS :

NIL

IV OPPOSITE PARTY'S DOCUMENTS :

D1 - Photocopy of Kerala State Life Insurance Rules

D2 - Photocopy of premium receipt book.

D3 - Government Order no. G.O.(P) No. 25/04/Fin dated 12.01.2004.

D4 - Photocopy of Government Order No. G.O. (MS) no. 1320/99/Fin dated 29.04.1999.

D5 - Photocopy of letter dated 13.04.2004 from the Director of Insurance.

D6 - Schedule of Kerala State Insurance Department Life Insurance policy.

PRESIDENT