This complaint coming up before us for hearing on 01-07-14                                in the presence of Sri G. Punna Reddy, advocate for complainant and                         Sri Sanath Kumar, advocate for opposite parties, upon perusing the material on record, after hearing both sides and having stood over till this day for consideration this Forum made the following:-

O R D E R

Per Sri A. Hazarath Rao,  President:-      The complainant filed this complaint under section 12 of the Consumer Protection Act seeking the insured amount of Rs.1,00,000/-; Rs.15,000/- as damages towards mental agony and physical strain and Rs.5,000/- toward costs of the complaint.

2.   In brief the averments of the complaint are these:

          One K. Dibbaiah s/o Chinnabai was holder of RPLI policy No.196285.   The said Dibbaiah paid premium @Rs.268/- pm from 21-11-05 to 09-01-12.   If any policy holder dies during the existence of policy the nominee is entitled for Rs.1,00,000/-.   The said Dibbaiah died on 18-02-12.   The complainant being nominee made a claim for the policy amount.   The 1^st opposite party on 01-02-13 informed the complainant that the insured did not get the policy revived during his lifetime for not submitting good health certificate though paid arrears of premium from 03/06 to 01/07 on 17-11-06; 12-12-06 and 19-01-07, the said policy thus get lapsed under rule 56 of POLI rules since March, 2006.   The 1^st opposite party sent Rs.19268/- being the premium paid from 3/06 to 01/12.     It is the bounded duty of the opposite parties and their employees to demand good health certificate while receiving the premium.   The opposite parties have not made any demand for good life certificate while receiving premium and it amounted to negligence within the purview of deficiency in service.   The opposite parties 1 and 2 did not give reply though received complainant’s notice.   The complaint therefore be allowed.

3.   The contention of the opposite parties in nutshell is hereunder:

   The complainant is nominee of the RPLI policy bearing No.196285.   The insured paid premium regularly from 11/05 to 02/06.   The insured has not paid premium from 3/06 to 1/07 and submitted a letter to the 2^nd opposite party requesting permission for revival of his policy and payment of arrears of premiums.   The 2^nd opposite party considered and allowed the insured to pay the arrears of the premium in three installments @1036/- each with a direction to submit good health declaration vide letter No.RPLI/R/AP/VJ/EA/196285.   The insured paid Rs.1038/- on 17-11-06; Rs.1036/- on 12-12-06; Rs.1036/- on 19-01-07.    But the insured did not submit the good health certificate and good health declaration for revival of his policy.    

          As per Rule 58(2) of Post Offices Life Insurance Rules, 2011, a policy shall not be considered to have been revived unless and until the policy has been formally revived in writing.   In the present case the policy was not revived as the late insurant has not submitted Good Health Certificate and Good Health declaration during his life time.   As per Rule 58(3) of P.O.L.I. Rules any payments purporting to be premia payments made after policy is formally revived in terms of Rule 58(1) and 58(2)  P.O.L.I. Rules 2011, shall be held in suspense and shall not be considered as payments by way of premia to cover the risk of life assured.   No claim what so ever shall lie on the department in the event of death of the life assured during such period when premia are held in suspense and policy is not revived.   Such premia are held in suspense shall be refunded to the nominee as and when applied for. 

     The competent authority after careful examination of the claim and refunded the premium paid after lapsation on 01-02-13.   The opposite parties did not commit any deficiency in service.   The complaint therefore be dismissed.

4.  Exs.A-1 to A-30 were marked on behalf of complainant.  No documents were marked on behalf of opposite parties.  

5.   Now the points that arose for consideration in this complaint are:

          1. Whether rejection of the claim by the opposite parties is just and                       reasonable and if so not amounted to deficiency in service?

          2. Whether the complainant is entitled to compensation?

          3. To what relief?

6.   Admitted facts in this complaint are these:-

          1.  One K. Dibbaiah took RPLI policy bearing No.EA-196285 for                                        Rs.50,000/- (Ex.A-7).

          2. The complainant paid Rs.268/- pm under Exs.A-8 to A-25; A29 and                            Rs.536/- under Ex.A-30.

          3. The insured paid Rs.1038/- on 17-11-06 (Ex.A-28); Rs.1036/-

               on 12-12-06 (Ex.A-27) and Rs.1036/- on 19-01-07 (Ex.A-26).

          4.  The insured died on 18-02-12 (Ex.A-1).

          5. The complainant is nominee under the said policy.

          6. The complainant submitted claim application.

          7.  The opposite party repudiated the claim while refunding                                   Rs.19,268/- (ExA-3).

          8. The insured got issued notice to the opposite parties 1 and 2                                      (Exs.A-5 and A-6).

7.  POINT No.1:-     The opposite parties relied on Rule 58 of Post Offices Life Insurance Rules, 2011.   

     The relevant portion in Ex.A-3 is extracted below for better appreciation:

       “Your claim application has been carefully examined and it is found that the insurance had paid the arrear of premiums from 03/06 to 01/07 on 17-11-06, 12-12-06 and 19-01-07.   But the policy was not revived under Rule 58 of POLI rules, during the life time, as the insurant had not submitted Good Health certificate and declaration after the payments of above premiums.    Hence, the policy stands lapsed under Rule 56 of POIF Rules since 3/06.

       Therefore the contract of insurance become void and we regret to inform that the claim could not be admitted.   The amount paid in the shape of premium from 11/05 to 2/06 to the RPLI Fund will be forfeited to the Government as per rules.   An amount of Rs.19268/- (Rupees nineteen thousand, two hundred and sixty eight only) paid by the insurant from 3/06 to 1/12 after lapsation of policy is being refunded”.

8.  Rule 56 clause (1) of Post Office Life Insurance Rules says that the policy for which any premium/premia have become due, not paid either on first day of the month for which the premium is due or within the period of grace allowed as per Rule 44, the policy shall become void.

9.  Rule 58 deals with revival of policies.   For better appreciation Rule 58 is extracted below:

58.(1). The Postmaster General/ Head of Division, may in his discretion, on receiving an application in the prescribed proforma allow a policy, which has become void in terms of Rule 56(1), or has ceased to be active in terms of Rule 57(1) and has not been re-instated under the provisions of Rule 56 (3) or 57(3), to be revived provided that the said policy has not attained the date of maturity and the life assured is insurable at the time of revival. Such revival shall be subject to payment, within a date to be specified by the Postmaster General/ Head of Division, of all arrears of premia with interest thereon at the rates prescribed by the Director General of Posts and calculated from the date the first unpaid premium in respect of such policy had become due and further subject to production of a certificate from the employer (s) that the policy holder had not taken any leave on medical grounds during the last one year, or during the period from the date the first unpaid premium had become due in respect of such policy, and certificate from an authorized medical attendant in the prescribed proforma certifying that the life assured is insurable having regard to the insurants health and habits and of evidence to show that there has been no adverse change in his/her personal or family history or his/her occupation.

58. (2).          A policy shall not be considered to have been revived unless an application for that purpose has been made and until the policy has been formally revived in writing (emphasis supplied).

58. (3).          Any payments purporting to be premium/premia payments made after a policy has become void in terms of Rule 56(1) or has ceased to be active in terms of Rule 57(1) but before the policy is formally revived in terms of sub rule (1) and (2) above shall be held in suspense and shall not be considered as payments by way of premium/premia to cover the risk of life assured. No claim whatsoever shall lie on the department in the event of death of the life assured during such period when premium/premia are held in suspense and the policy is not revived. Such premia as are held in suspense shall be refunded to the policy holder, his/her nominee or his/her legal heir as the case may be, as and when applied for, with interest as prescribed by the Director General of Posts.

58. (4).          The Postmaster General/ Head of Division, may at his discretion in order to revive a policy which has become void under Rule 56 (1) or cease to be active under Rule 57(1) allow the arrears of premia along with interest payable thereon to be paid in convenient installment not exceeding 12 installments in deserving cases under a specific order to be issued in writing. In such cases, the risk of the life assured shall be covered from the day the first installment is deposited provided that subsequent installments have been paid regularly thereafter, as also the normal monthly premia besides the arrears as become due have been deposited regularly as and when due without fail. In the event of death of the insurant, who has been depositing the installment of arrears as directed by the Postmaster General/ Head of Division besides the normal monthly premia regularly as and when due notwithstanding the fact that some arrears of premia remain unpaid at the time of death, the claim against the said policy shall be accepted subject to the deduction of such arrears of premia and interest thereon besides loan amount and interest thereon, if any, from the claim amount.

58 (5). For revival of RPLI policies, these rules shall apply mutatis mutandis except that the employer’s certificate shall not be required”.

10.  Exs.A26 to A-28 revealed that the opposite parties permitted the insured Dibbaiah to pay the amount in three installments.   It can therefore be inferred that the insured filed an application to revive the policy and permit him to pay the amount due by then in three installments.

11.    It is also not the case of the complainant that the insured submitted Good Health Certificate and Good Health Declaration while paying the premiums covered by Exs.A26 to A-28 and on subsequent dates till his death.  On the other hand, the contention of the complainant is that the opposite parties and their employees did not insist for Good Health Certificate while receiving premium.   In Ex.A-7 policy it was mentioned:

12.  The opposite parties and their employees cannot act beyond Post Office Life Insurance Rules as rightly contended by the learned counsel for the opposite parties.

 13.   As per Rule 58(2) of Post Offices Life Insurance 2011, a policy shall not be considered to have been revived unless and until the policy has been formally revived in writing.   In the present case the policy was not revived as the late insurant has not submitted Good Health Certificate and Good Health declaration during his life time.   As per Rule 58(3) of P.O.L.I. Rules any payments purporting to be premia payments made after policy is formally revived in terms of Rule 58(1) and 58(2)  P.O.L.I. Rules 2011, shall be held in suspense and shall not be considered as payments by way of premia to cover the risk of life assured.   No claim what so ever shall lie on the department in the event of death of the life assured during such period when premia are held in suspense and policy is not revived.   Such premia are held in suspense shall be refunded to the nominee as and when applied for. 

14.    The insured paying the due premiums in three installments leads us to draw an inference that he was informed to submit Good Health Certificate and Good Health Declaration for revival of his policy as the opposite parties acted in terms of rule 58 of Post Office Life Insurance Rules.   We are of the considered opinion that they did not commit any deficiency in service and answer this point against the complainant.

15.  POINT No.2:-  In view of our findings on point No.1, we answer this point also against the complainant.

16.   POINT No.3:-   In view of above findings, in the result the complaint is dismissed without costs. 

Typed to my dictation by Junior Stenographer, corrected by us and pronounced in the open Forum dated this the 4^th day of July, 2014.

Sd/-XXX                                   Sd/-XXX                           Sd/-XXX

MEMBER                                     MEMBER                              PRESIDENT

APPENDIX OF EVIDENCE

DOCUMENTS MARKED

For Complainant:

For opposite parties:    NIL   

                                                                                       Sd/-XXX

                                                                                              PRESIDENT

NB:   The parties are required to collect the extra sets within a month after receipt of this order either personally or through their advocate as otherwise the extra sets shall be weeded out.