Tamil Nadu

South Chennai

CC/90/2013

D.Nicholos - Complainant(s)

Versus

R.Manivannan - Opp.Party(s)

R.K.Bhavanantham

03 Oct 2018

ORDER

                                                                        Date of Filing  : 18.03.2013

                                                                          Date of Order : 03.10.2018

 

DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, CHENNAI (SOUTH)

@ 2^ND Floor, Frazer Bridge Road, V.O.C. Nagar, Park Town, Chennai – 3.

 

PRESENT: THIRU. M. MONY, B.Sc., L.L.B, M.L.                    : PRESIDENT

                 TMT. K. AMALA, M.A., L.L.B.                                : MEMBER-I

 

C.C. No.90/2013

DATED THIS WEDNESDAY THE 03^RD DAY OF OCTOBER 2018

                                 

D. Nicholes,

S/o. Mr. P.C. Devaanbu,

Door New No.36, Old No.10/1,

Yemi Street,

Purasaiwakkam,

Chennai – 600 007.                                                      .. Complainant.                                                   

 

      ..Versus..

 

1. M/s. Birla Sun Life Insurance,

“G Corop Tec” Tec Park,

5^th and 6^th Floors, Kasar Wadavali,

Bore Bandar Road,

Thanea – 400 601.

 

2. Birla Sun Life Insurance,

Nos.22 & 23, Hotel Shahithyan Annexer Building,

II nd Floor, Venkatramana Road,

Above Axes Bank,

Chennai – 600 017.                                             ..  Opposite parties.

          

Counsel for complainant         :  M/s. V.Venkatesan & others

Counsel for opposite parties   :  M/s. Jayanthi K. Shah

 

ORDER

THIRU. M. MONY, PRESIDENT

       This complaint has been filed by the complainant against the opposite parties under section 12 of the Consumer Protection Act, 1986 praying to declare that the termination of Birla Sun Life Insurance Gold plus II policy bearing No.001403945 in the name of the complainant as null and void and still is in enforceable and valid, to direct the opposite parties to return the sum of Rs.1,20,000/- with interest at 24% p.a. i.e. from 04.02.2005 on the premium amount of Rs.1,00,000/- till the date from 11.02.2009 on the premium amount of Rs.10,000/- till the date and from 15.02.2010 on the same of Rs.10,000/- till the date alternatively and to pay a sum of Rs.5,00,000/- towards compensation for mental agony, stress, strain and hardship to the complainant.

1.    The averments of the complaint in brief are as follows:

The complaint submits that he is a Senior Citizen and retired from Government service on 30.06.1996.  The complainant is a pensioner.  The opposite parties’ representatives boosted the benefits of the Life Policy and trapped the complainant to avail the policy assuring that there shall be death benefit and maturity benefit.   Further the complainant submits that as per the policy its value, provisions to the insurer, flexibility to reduce annual policy premium at any time after the first policy subject to a minimum annual policy premium of I.N.Rs.10,000/-.  The policy is terminable in the following circumstances which reads as follows:

a.  The date of the insurance company confirm surrender request of the policy holder.

b.  The date on which the two year  period ends after the policy has lapsed, unless the policy, is revived as per the premium, discontinuances provision.

c.  The date the life insurance dies or the policy maturity date.

2.     Further the complainant submits that the local agent of the opposite parties one Mr. Dilip Kumar canvassed the complainant and boosted the benefits of Birla Sun Life Insurance Gold Plus policy guarantees much more gold insurance cover.  The plan is unit linked non participating insurance plan for duration of eight years.   The said plan offers convenience to its customers for a limited period of three years for the flexibility to reduce premium from the second year policy onwards.  On good faith, the complainant has paid a sum of Rs.1,00,000/- towards Annual premium for the first policy year.  Thereafter, the complainant paid a sum of Rs.10,000/- on 20.02.2008 towards second policy year minimum premium and on 11.02.2008 also made a payment of Rs.10,000/- towards second premium. 

3.     Further the complainant submits that the 1^st opposite party sent SMS to the complainant’s mobile calling upon to pay a sum of Rs.1,00,000/- which was overdue and outstanding towards the premium for the said policy coverage.  After receiving a sum of Rs.1,20,000/- and issued a letter stating that the said amount has been received towards for the policy for the period from 01.04.2001 to 18.02.2016.   Hence, the complainant issued lawyer notice dated:01.03.2010 for which, the 1^st opposite party sent a reply and altered the status regarding the complainant’s policy.   So, the complainant issued another lawyer notice dated:31.12.2007 for which, the opposite parties has not sent any reply.  The 2^nd opposite party informed the complainant that the policy issued in favour of the complainant was terminated without any reason.  The complainant sent written representation dated:28.11.2012 for due revival of the policy or return of the premium amount with interest.    Further the complainant submits that after receiving payment of Rs.1,20,000/- of premium and after issuing receipt stated that the said amount towards the policy for the period of 01.04.2001 to 18.02.2016.  The act of the opposite parties caused great mental agony.  Hence the complaint is filed.

4.      The brief averments in the written version filed by the  opposite parties is as follows:

The opposite parties specifically deny each and every allegations made in the complaint and puts the complainant to strict proof of the same.   The opposite parties state that the complainant has not approached this Forum with clean hands.   Further the opposite parties state that neither the 1^st opposite party nor the 2^nd opposite party from the very beginning has not made any misrepresentation, concealment of facts, negligence or deficiency in service.  Further the opposite parties state that the complainant voluntarily applied for the insurance policy after fully knowing well about the terms and condition namely clause 6(2) of the Insurance Regulatory (Protection of Policyholder’s Interests) Regulations, 2002.  Further the opposite parties state that the complainant has not claimed any amount to return within the free look period of 15 days of receipt of the policy document.  Further the opposite parties state that the complainant is an educated person having the knowledge of the terms and condition of the policy opted an unique link insurance plan and also well aware of investment features of the policy contract.   In Unit Linked Products, the Investment risk in the investment portfolio is to be borne by the Policyholder.  The complainant is conversant with the Policy terms and conditions and had availed the reduction in the Premium facility for 2^nd Policy year onwards.  The Unit Price of any investment Fund May increase or decrease as per the performance of the financial markets.   Further the opposite parties state that the complainant has no adjudicable grievance against the opposite parties  and the complainant has failed to prove any cause of action or prima facie in the complaint against the opposite parties and therefore, failed to set up any case for any reliefs as such, hence the complaint filed by the complainant may kindly be dismissed with costs.

5.     To prove the averments in the complaint, the complainant has filed proof affidavit as his evidence and documents Ex.A1 to Ex.A12 are marked.  Proof affidavit of the opposite parties filed and documents Ex.B1 & Ex.B2 are filed and marked on the side of the opposite parties.   

6.      The points for consideration is:-

1. Whether the complainant entitled to the relief of termination of policy null and void as prayed for?
2. Whether the complainant is entitled to get return of the sum of Rs.1,20,000/- paid towards premium with interest at the rate of 24% p.a. with a compensation of Rs.5,00,000/- and cost as prayed for?

7.      On point:-

Both parties filed their respective written arguments.  Heard the complainant’s Counsel also.  Perused the records namely the complaint, written version, proof affidavits, documents etc.   The complaint pleaded and contended that he is a Pensioner and Senior Citizen.  The opposite parties’ representatives boosted the benefits of the Life Policy and trapped the complainant to avail the policy assuring that there shall be death benefit and maturity benefit.   Further the contention of the complainant is that as per the policy, Ex.A1 its value, provisions to the insurer, flexibility to reduce annual policy premium at any time after the first policy subject to a minimum annual policy premium of I.N.Rs.10,000/-.  The policy is terminable in the following circumstances which reads as follows:

a.  The date of the insurance company confirm surrender request of the policy holder.

b.  The date on which the two year  period ends after the policy has lapsed, unless the policy, is revived as per the premium, discontinuances provision.

c.  The date the life insurance dies or the policy maturity date.

8.     Further the contention of the complainant is that the local agent of the opposite party one Mr. Dilip Kumar canvassed the complainant and boosted the benefits of Birla Sun Life Insurance Gold Plus policy guarantees much more gold insurance cover.  The plan is unit linked non participating insurance plan for duration of eight years.   The said plan offers convenience to ins customers for a limited period of three years for the flexibility to reduce premium from the second year policy onwards.  On good faith, the complainant has paid a sum of Rs.1,00,000/- towards Annual premium for the first policy year as per Ex.A2.  Thereafter, the complainant paid a sum of Rs.10,000/- on 20.02.2008 towards second policy year minimum premium and on 11.02.2008 also made a payment of Rs.10,000/- towards second premium.  All these payments are very clearly admitted by the opposite party as per Ex.A4.   Further the contention of the complainant is that the 1^st opposite party sent SMS to the complainant’s mobile calling upon to pay a sum of Rs.1,00,000/- which was overdue and outstanding towards the premium for the said policy coverage.  After receiving a sum of Rs.1,20,000/- and issued Ex.A4 letter stating that the said amount has been received towards for the policy for the period from 01.04.2001 to 18.02.2016.   The opposite party has not explained the clauses in Ex.A1 policy conditions. Hence, the complainant issued lawyer notice dated:01.03.2010 as per Ex.A5 for which, the 1^st opposite party sent a reply and altered the status regarding the complainant’s policy.   So, the complainant issued another lawyer notice dated:31.12.2007 as per Ex.A7 for which, the opposite party has not sent any reply.  The 2^nd opposite party informed the complainant that the policy issued in favour of the complainant was terminated without any reason.  The complainant sent written representation dated:28.11. 2012 as per Ex.A11 for due revival of the policy or return of the premium amount with interest.    Further the contention of the complainant is that after receiving payment of Rs.1,20,000/- of premium and after issuing receipt as per Ex.A4 stating that the said amount towards the policy for the period of 01.04.2001 to 18.02.2016 and thereafter, claiming a sum of Rs.1,00,000/- is totally unfair trade practice and deficiency in service.  Equally, terminating the policy without any notice is also unfair trade practice.  The complainant is claiming the relief of cancellation of policy as null and void or alternatively, return of the premium of Rs.1,20,000/- with interest and compensation.

9.     The contention of the opposite parties is that the complainant has not approached this Forum with clean hands.  But the opposite party has not explained what are the facts suppressed by the complainant in this case.  Further the contention of the opposite parties is that neither the 1^st opposite party nor the 2^nd opposite party from the very beginning has not made any misrepresentation, concealment of facts, negligence or deficiency in service.  But at the outset itself, the opposite party has not explained the reason for non disclosure and explanation regarding the terms and conditions of the policy.  Further the contention of the opposite parties is that the complainant voluntarily applied for the insurance policy after fully knowing well about the terms and condition namely clause 6(2) of the Insurance Regulatory (Protection of Policyholder’s Interests) Regulations, 2002.  But in this case, neither the complainant nor the opposite parties has not pleaded anything about the said clause 6 (1 & 2).  The opposite parties also has not pleaded and proved that they have explained the contents of the clause 6(1 & 2). 

10.    Further the contention of the opposite parties is that the complainant has not claimed any amount to return within the free look period of 15 days of receipt of the policy document.   But on a careful perusal of the records, there is no document produced before this in this case to prove the confirmation of the policy as per the terms and conditions.  Further the contention of the opposite parties is that the complainant is an educated person having the knowledge of the terms and condition of the policy opted an unique link insurance plan and also well aware of investment features of the policy contract.  In Unit Linked Products, the Investment risk in the investment portfolio is to be borne by the Policyholder.   The complainant is conversant with the Policy terms and conditions and had availed the reduction in the Premium facility for 2^nd Policy year onwards.  The Unit Price of any investment Fund May increase or decrease as per the performance of the financial market.  In this case, the fund value in the instant Policy contract was depleted and turned negative.  As the fund value turned negative, the Policy ceased to be in force and got terminated.   But the opposite parties has not produced any statement of accounts showing that the entire amount has been depleted resulting termination of the policy.  The opposite parties also has not informed from time to time that the value of Unit-Linked Insurance is falling day by day amounts to suppression of material facts and deficiency in service.    

11.    As per the decision cited in:

III (2007) CPJ 34 (NC)

NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION,

NEW DELHI

Between

National Insurance Co. Ltd.,

-Versus-

D.P. Jain

Held that

“If exclusion clauses not explained, regulations not binding on insured – Said clauses required to be ignored while considering claim of insured. ... In present case, intermediary (HCL) issued insurance cover as an agent of OP – Op bound to reimburse complainant”.

As per the Insurance Regulatory and Development Authority (Protection of PolicyHolders’ Interests) Regulations, 2002 (IRDA) it is held that:

“3(2) An insurer or its agent or other intermediary shall provide all material information in respect of a proposed cover to the prospect to enable the prospect to decide on the best cover that would be in his or her interest.

3(4) Where, for any reason, the proposal and other connected papers are not filled by the prospect, a certificate may be incorporated at the end of proposal form from the prospect that the contents of the form and documents have been fully explained to him and that he has fully understood the significance of the proposed contract”.

Considering the facts and circumstances of the case, this Forum is of the considered view that the opposite parties 1 & 2 are jointly and severally shall refund a sum of Rs.1,20,000/- with interest at the rate of 9% p.a. from the date of complaint and to pay a compensation of Rs.20,000/- with cost of Rs.5,000/-.

In the result, this complaint is allowed in part.  The Opposite parties 1 & 2 are jointly and severally liable to refund a sum of Rs.1,20,000/- (Rupees One lakh twenty thousand only) being the Insurance  Premium amount with interest at the rate of 9% p.a. from the date of complaint i.e. 18.03.2013 to till the date of this order and to pay a sum of Rs.20,000/- (Rupees Twenty thousand only) towards compensation for mental agony with cost of Rs.5,000/- (Rupees Five thousand only) to the complainant.

The above amounts shall be payable within six weeks from the date of receipt of the copy of this order, failing which, the said amounts shall carry interest at the rate of 9% p.a. to till the date of payment.

Dictated  by the President to the Steno-typist, taken down, transcribed and computerized by her, corrected by the President and pronounced by us in the open Forum on this the 03^rd day of October 2018. 

 

MEMBER –I                                                                      PRESIDENT

COMPLAINANT SIDE DOCUMENTS:

Ex.A1		Copy of Policy Information of Birla Sun Life Insurance Gold Plus II
Ex.A2	04.02.2008	Copy of First Premium receipt
Ex.A3	04.02.2010	Copy of policy Account Statement
Ex.A4	18.02.2010	Copy of premium paid Certificate
Ex.A5	01.03.2010	Copy of complainant’s lawyer’s notice
Ex.A6	23.11.2011	Copy of premium paid certificate by Birla Sun Life
Ex.A7	31.12.2011	Copy of complainant’s lawyer’s notice
Ex.A8	06.02.2012	Copy of complainant’s complaint addressed to the Insurance Ombudsman
Ex.A9	13.02.2012	Copy of reply by Birla Sun Life Insurance
Ex.A10	29.03.2012	Copy of reply by office of the Insurance Ombudsman, Chennai
Ex.A11	28.11.2012	Copy of written representation by the complainant (Status report)
Ex.A12		Copy of postal acknowledgement card

 

OPPOSITE  PARTIES SIDE DOCUMENTS: 

Ex.B1	11.01.2008	Copy of Proposal Form which was provided to the complainant at the time of filing and signing of the Proposal Form along with Sales illustration Form
Ex.B2	18.02.2010	Copy of Premium Paid Computer Generated Certificate

 

 

MEMBER –I                                                                      PRESIDENT