Delhi

North

CC/182/2019

CHARANJIT JAWA - Complainant(s)

Versus

RELIANCE NIPPON LIFE INSURANCE COMPANY LTD. & ANOTHER - Opp.Party(s)

AJESH K. CHAWLA & SHIV KUMAR

21 Oct 2023

ORDER

District Consumer Disputes Redressal Commission-I (North District)

[Govt. of NCT of Delhi]

Ground Floor, Court Annexe -2 Building, Tis Hazari Court Complex, Delhi- 110054

Consumer Complaint No. 182/2019

In the matter of

Sh. Charanjit Jawa

229, Vivekanand Puri

Delhi-110007                                                                                                                        …Complainant

vs

Reliance Nippon Life Insurance Company Ltd.

(Formerly known as Reliance Life Insurance Company Ltd.)

IRDAT Registration No.121

Also at

Ist floor, 17, Padam Singh Road, Block 1C, WEA, Karol Bagh

Delhi-110005

 

Corporate office at

Reliance centre

Off Western Express Highway

Santacruz East

Mumbai-400055                                                                                                                  …Opposite Party-1

         

STM Reliance Nippon Life Insurance Company Ltd.

F-14/41, Ist floor, Model Town-II

Delhi-110009                                                                                                                       …  Opposite Party-2

ORDER

21/10/2023

Ms.Harpreet Kaur Charya, Member

          The present complaint has been filed by Sh. Charanjit Jawa, the Complainant against, Reliance Nippon Life Insurance Company Ltd as OP-1, and STM Reliance Nippon Life Insurance Company Ltd., as OP-2 with the allegations of deficiency in services and unfair trade practice.

1. Facts necessary for the disposal of the present complaint are that, the complainant had purchased Reliance Life Insurance Guaranteed Money Back Plan bearing contract no. 51391141; client Id:87090209, with assured amount of Rs.2,36,530/-.The policy period was 15 years and the annual premium of  Rs. 50,135/- with premium payable term for 5 years.  As per the complainant, the photocopy of the booklet dated 26/12/2013 was issued by OP-1. 
2. The complainant paid 03 premiums and thereafter, opted for surrender benefit.  It has been stated by the complainant that he could opt for surrender benefits in case the full premium were paid for at least 03 consecutive years.
3.  On 23/09/2017, the complainant was informed through a letter stating that the surrender value of the policy as on 20/09/2017 was Rs.81,816/-, which was much less than the 03 premiums paid. 
4. It has been alleged by the complainant that the Surrender Value clause is very ambiguous and there is no clear method or formula for calculation of the surrender value.  The OP-1 has deducted almost more than Rs.68,000/-, which is  about  46% of the total amount of premium deposited.  OP-1 has also deducted service charge thereby, creating significant imbalance of the rights and obligations of the parties in the contract of insurance which amounts to unfair trade practice.   
5. The complainant has also alleged that the OP-1 has violated the guidelines and procedural law laid down in Insurance Act 1938 (Section 113 & 40B) and Regulatory authority; the surrender value was not released within the time prescribed; the OP has utilized an amount of Rs.1.5 lacs for about four years without any interest and deduction made at the time of assessing surrender value amount, are arbitrary and excessive.
6. A Legal notice dated 20/11/2017 was served upon OPs demanding the statement of account and the calculation/formula for arriving at the surrender value, which was neither complied nor replied. Complainant has prayed for directions to OPs to:

1.  Pay balance Rs.68,000/-plus interest @12% p.a. from the date of payment of the premiums by the complainant under the policy plan.
2.  Provide all the bonus and incidental benefits under the insurance policy in question to the complainant/policy holder with due appreciation of the amount deposited by the complainant.
3. Provide compensation of Rs.1,00,000/- with interest at the bank rate for the physical and mental harassment.
4. Pay Rs.30,000/- with interest at the bank rate for the cost of complaint as well as litigation.
5. Any other relief which the Forum may deem fit to be granted to the complainant against OPs.

7. The complainant has filed photocopy of Booklet of Reliance Life Insurance issued by   OP-1 as Annexure-C1, copy of surrender statement of policy issued by OP-1 as Annexure-C2, copy of  Legal Notice dated 20/11/2017 to the OP-1 as Annexure-C3, copy of the receipt of the speed post dated 21/11/2017 as Annexure-C4 with the complaint.
8. Notice of the present complaint was served upon OPs.  Thereafter, written statement was filed on behalf of the OPs where they have taken several pleas in their defence such as there was no cause of action in the favour of the complainant against OP; the present complaint is an afterthought and has been filed to extort money; the complainant did not return the policy with in Free look period of 15 days; the matter involved complex question of facts and the same could not be decided under summary proceedings under the Consumer Protection Act,2019 and there was no deficiency in services on their part.
9. It has been submitted that the complainant being an educated person, must have gone through the terms and conditions of the policy as well as the application as the same was filled and signed by him. It has stated that the policy no.51391141 was duly dispatched to the complainant through speed post and the same was delivered on 30/12/2013. The complainant has paid only Rs.1,48,898/- and the policy was surrendered on 20/09/2017 and as per terms and conditions the amount of Rs.81,817 was transferred to the account no.30004842611,State Bank of India via NEFT HDFC reference no. N268170373872804 dated 25/09/2017.
10. It has further been submitted that the surrender value had been calculated as per Point 10 of the Surrender Benefits as explained in the Policy terms and conditions and as the complainant never demanded statement of account; thus, it appears that no statement of account was supplied to him. Rest of the contents of the complaint have been denied.
11. Complainant has filed Rejoinder to the Written Statement of OP. It has been stated by the complainant that the surrender benefit amount was transferred to the account of the complainant without his knowledge and consent.  It has been further alleged that deductions made in assessing the surrender value has not been explained even with the written statement. There is a provision of guaranteed surrender value and secured loyalty addition in the policy which provides for higher surrender value.  Rest of the contents of the complaint have been reiterated and those of the written statement have been denied.
12. Complainant has filed evidence by way of affidavit, reiterating the contents of the Complaint and Rejoinder.  He has got exhibited the copy of the booklet issued by OP-1 as Ex.C-1 ; copy of the surrender statement policy dated 23/09/2017 as Ex.C-2; legal notice dated 20/1/2017 along with postal receipts have been exhibited as Ex.C-3 and Ex.C-4 respectively.
13. No evidence affidavit was filed by OP despite several opportunities. 
14. We have heard the arguments on behalf of Ld. Counsel for the complainant and the Ld. Counsel for the OP.  We have also perused the material placed on record and written arguments filed by OP.  The factum of issuance of policy and the surrender of same is not in dispute.
15. It is the case of the complainant that the surrender value of Rs.81,816/- disbursed by OP-1 was short as the complainant has paid three premium of Rs.50,135/- each. The complainant has alleged that no specific method or formula has been disclosed in assessing the surrender value of the policy and no statement of account appear to have been supplied in the course of running of policy and there was delay in releasing the amount of surrender value.   
16. The complainant has alleged that Guaranteed Money Back Plan was never intended and agreed upon to be a Unit Linked Insurance Plan (ULIP).  It is an admitted fact that the complainant had received the policy booklet on 26/12/2013 (Ex.C-1), as per which the complainant had opted for ‘Reliance Life Insurance Guaranteed Money Back Plan’. At the same time, in the covering letter the complainant was offered an option, that in case the complainant was in disagreement with the terms and conditions of the plan and wished to opt out of the plan, he could do so by stating the reason of his disagreement and return the policy to the company within 15days of its receipt, for cancellation. The complainant did not exercise his option of cancellation within the ‘Free Look’ period. As per regulation of IRDA and policy terms and conditions, the complainant was given an option of “Cancellation in the Free-Look Period” to cancel the policy within 15days from the date of receipt of the said policy, but complainant did not exercise the Free-Look Cancellation option, now he cannot dispute terms and conditions.
17.  Further, in the judgement of Japji Kaur Cheema v. ICICI Home Finance Co. Ltd., I (2013) CPJ 401 (NC), wherein it was held that “payment of surrender amount as per agreed terms and conditions cannot be termed as deficiency in service and terms incorporated in the policy are agreement between the parties for intents and purposes and the parties are bound by them, thus once agreement is entered, none of the parties can go behind the terms of such agreement or allege that the conditions were not fair”.  Therefore, in the light of above judgement, the complainant’s contention is not justifiable and we cannot hold OP-1 liable for unfair trade practice.
18. The complainant has alleged that OP-1 not only failed to share the formula/calculation/statement of account as to how the surrender value of Rs.81,816.89 has been calculated, even in the Legal notice dated 20/11/2017, the complainant has contended the same. Once the complainant has been paying his hard earned money in the form of premiums to OP-1, he has every right and it’s the duty of the OP-1, to share the calculation as to what are the deductions, applicable load etc. for deriving the surrender value. Merely, transferring the surrender value, without any calculation is an arbitrary act of OP-1. Non-supply of calculation/statement of account amounts to deficiency in service.
19. It will not be out of context to mention that the complainant has not filed the complete policy booklet (comprising of 20 pages) with the complaint, page no.12, 13 of the policy booklet are missing.

Therefore, in the facts and circumstances of the present complaint and as per above discussion we direct OP-1 to pay Rs.5,000/- as compensation on account of deficiency in service for non-supply of calculation of surrender value. The order be complied with in 30 days from the date of receipt of order. In case of non-compliance, the OP-1 shall be liable to pay interest @7% per annum on Rs.5,000/- from the date of order till realisation.

Office is directed to supply the copy of this order to the parties as per rules. Order be also uploaded on the website.  Thereafter, file be consigned to the record room.

 

(Harpreet Kaur Charya)            Member	(Ashwani Kumar Mehta) Member   (Divya Jyoti Jaipuriar)           President