DISTRICT CONSUMER DISPUTES REDRESSAL FORUM-II

Udyog Sadan, C-22 & 23, Qutub Institutional Area

(Behind Qutub Hotel), New Delhi-110016.

Case No.524/08

Sh. P. K. Sharma (since deceased)

through Sh. Aseem Sharma

S/o Late Sh. P. K. Sharma

Permanent resident of:

House No.20/79, Ring Road,

Indiranagar, Lucknow-226016

Presently residing at:

C/o S. N. Bansal

A-1/103, Manas Apartments,

Mayur Vihar Extn Ph-1

New Delhi-110091                                                      ….Complainant

Versus

1.      SBI Cards & Payments Services (P) Ltd.

          through the Marketing Head

          11, Parliament Street

          New Delhi-110001

2.      Royal Sundaram Alliance Insurance Co. Ltd.,

        through the Executive (Claims)

        Corporate Claims Department,

          Sundaram Towers, 45 & 46 White Road,

          Chennai-600014                                        …...Opposite Parties

              Date of Institution             :   21.08.08    

Date of Order            :   31.05.17

Coram:

Sh. N.K. Goel, President

Ms. Naina Bakshi, Member

ORDER

The present complaint pertains to repudiation of the accidental claim of Rs.7,50,000/- on account of the death of insured Sh. P. K. Sharma by his son (complainant herein). It is an admitted case of the parties that the insured had a Visa Card bearing No.4317575014735477 with OP No.1 which provided an insurance policy bearing No. PS00010267000101 of OP No.2 for his personal accidental claim.  The insured died in a road accident on 12.01.05.  Thereafter, the complainant informed the OP No.2 about the death of his father on 26.07.05 by informing that the insured had already cleared off the due of the OP No.1 and in response to that OP No.1 issued NOC to settle the claim of death benefit of his late father from OP No.1. However, the OP No.2 vide letter dated 05.08.05 informed the complainant that the policy had expired on 08.12.04 and the claim was repudiated by OP No.2 vide letter dated 21.12.08 on the same ground that the insurance policy of his late father had already expired on 08.12.04.

Now, according to the complainant, the OP No.2 as per the arrangement had directly charged the premium of Rs.694/- for renewal of Personal Accidental Insurance from Visa Card issued by OP No. 1 and issued certificate dated 27.11.03 to the complainant confirming the renewal of the policy and benefit amount of Rs.7,50,000/- for accidental benefit; that on 31.12.03 OP No.2 issued a letter dated 31.12.03 to the complainant thereby reaffirming the renewal of the above stated accidental claim policy by charging the SBI Card.  However, on 16.11.04 OP No.1 issued a letter to the complainant stating that the credit limit card of his father had exceeded but on 30.11.04 the complainant received a letter from OP No.1 wherein OP No.1 admitted that there was inadvertent error on their part in stating that the credit limit for the card had exceeded and OP No.1 had apologized for that; that the late insured received a letter dated 24.12.04 from OP No.2 wherein OP No.2 stated that due date of renewal of the policy was 08.12.04.  According to the complainant, the rejection of the accidental death claim on the part of OP No.2 is bad in law and amounts to gross deficiency of service on the part of the OPs.  Hence, he has filed the present complaint for issuing directions to the OPs to pay to him forthwith Rs.7.50 lakhs alongwith interest @ 12% to be counted from the date of death of his father till actual payment, to pay Rs.5 lakhs towards compensation and Rs.10,000/- towards cost of litigation.

In the reply to the complaint OP No.1 has inter-alia stated that the complaint is hopelessly barred by limitation, since, the complainant had been informed about the rejection of his claim vide letter dated 05.08.05 and he has filed the present complaint in April, 2008. It is stated that the OP No.1 is not liable to process or settle the claim which is the sole prerogative of OP No.2; that as per the records maintained by OP No.1, OP No.1 neither received any instructions from the late insured nor from OP No.2 and, therefore, OP No.1 did not pay the premium for lack of instructions and hence OP No.1 cannot be held responsible for the lapse of the insurance policy. It is stated that as per records maintained by OP No.1 if the customer wishes to renew the policy, then in such an event before expiry of the policy either the customer gives instruction to OP No.1 to pay the premium to the insurance company or OP No.1 receives instruction from the insurance company to pay the premium and in such an event after getting confirmation from the customer premium amount is paid to the insurance company and customer’s credit card account is debited accordingly. It is stated that the letter dated 16.11.04 was wrongly issued which error was corrected by subsequent letter dated 30.11.04.  It is denied that OP No.1 had issued NOC to the complainant for the purpose of settling the claim. It is prayed that the complaint be dismissed.

In the reply OP No.2 has also pleaded that the complaint is time barred for the reason specified in the reply of OP No.1.  It is inter-alia stated that condition No.1 of the policy terms and conditions clearly prescribes that upon the happening of any event which may give rise to a claim under the schedule of the certificate, written notice with full particulars must be given to the company immediately and in any case, not later than 30 days after the death. But however, in the instant case complainant intimated the OP No.2 only after 165 days from the date of accident which is clear deviation from the requirement of the policy terms and conditions. It is stated that as per the policy terms and conditions OP No.2 is  under no duty or obligation to renew the said policy on its own as alleged by the complainant and that as per the condition No.5 the above said policy has to be renewed by mutual consent every year and in such event, the renewal premium shall be paid to the company on or before the due date of expiry of the said certificate or of the subsequent renewal thereof; that nowhere in the policy terms and conditions has the OP No.2 taken the responsibility of charging it directly from the credit card account without the communication from the complainant. It is stated that in the present case inspite of the intimation letter dated 24.12.04 of expiry of the policy the complainant did not take any efforts to communicate with OP No.2 with regard to renewal of the policy and hence OP No.2 cannot be made liable for the complications which occurred in the financial transactions of the credit card between his late father and OP No.1 who is the banking entity.  It is stated that the apology letter and related communication are of no relevance. Hence, it is prayed that the complaint be dismissed. 

Complainant has filed the rejoinders to the replies of the OPs.

Complainant has given power of attorney to Smt. Prathiba Sharma. Original Special power of attorney has been filed on the record.  Smt. Prathiba Sharma has filed her affidavit in evidence. On the other hand, affidavit of Sh. Abhijit Ghosh, Attorney Holder and affidavit of Sh. G. Vinay Prakash, Sr. Executive have been filed in evidence on behalf of the OP No.1 & 2 respectively.

Written arguments have been filed on behalf of the complainant and OP No.1

We have heard the oral arguments of the counsel for the complainant and have also gone through the record very carefully.

Vide letter dated 05.08.05 (copy Annexure P-9) OP No.2 had informed the complainant that as per their understanding the policy had expired on 08.012.04 and the OP No.2 shall revert to the complainant on this shortly. Therefore, the letter dated 05.08.05 cannot in anyway be said to be repudiation letter of the claim. Copy of letter dated 21.02.08 sent by OP No.2 to the complainant is Annexure P-11 wherein it is informed that the OP No.2 is unable to consider the claim as the policy in question had expired on 08.12.04 itself. This is infact a repudiation letter. Therefore, by no stretch of imagination can it be said that the complaint filed before this forum on 21.08.08 is time barred.  Therefore, we hold that the complaint is not time barred.

The deceased insured had died in a road accident on 12.01.05. Copy of the accident shield has been filed on the record on behalf of the complainant as Annexure P-1 and on behalf of OP No.2 as RW-1/2-3. It inter-alia contains condition No.1 which is reproduced as hereunder:-  

“Upon the happening of any event which may give rise to a claim under the Schedule of the Certificate, written notice with full particulars must be given to the Company immediately, and in case, not later than 30 days after the death/ disablement/injury.”

 The language employed in condition No.1 is too clear to elaborate. It is a well settled principle of law that the insurance contract has to be construed like any other contract on the basis of its terms and conditions and outside aid for construction of insurance policy is impermissible [(National Insurance Company Vs. Vinod Puri 1 (2014) CPJ 341 (NC)]. In the present case, the complainant had informed the OP No.2 about the death of his father (late insured) on 26.07.05 i.e. much beyond the expiry of the maximum prescribed period of 30 days. Therefore, on this ground alone his claim was liable to be rejected but the OP No.2 did not do so.

Next and the foremost question which has to be decided is, whether it was the duty of OPs to have mutual understanding between them regarding the sending/receipt of the premium amount from the Visa Card of the complainant’s deceased father.  According to the complainant, there was no fault on the part of his late father in clearing his dues and it was the duty of the OP No.2 to directly charge insurance policy renewal fee from the account of his late father.  However, as narrated hereinabove, in their replies, the OPs have denied this fact in toto.  OP No.2 has placed a reliance on condition No.5 of the Accident Shield in question which is reproduced as hereunder:-

“This Certificate may be renewed by mutual consent every year and in such event, the renewal premium shall be paid to the Company on or before the date of expiry of the Certificate or of the subsequent renewal thereof.”

From a perusal of the said clause it becomes crystal clear that the renewal of the insurance certificate had to be with mutual consent every year and it was not the duty of the OP No.1 to send it to the OP No.2 or for OP No.2 to claim it from OP No.1.

The case of the complainant himself is that on 16.11.04 OP No.1 had issued a letter to the complainant that credit limit for his visa card had exceeded. The copy of the same has been filed as Annexure-4 on behalf of the complainant wherein it is stated that the account of the deceased father of the complainant had a credit facility upto Rs.67,000/- and the current outstanding was Rs.36974.41p and  his account was therefore over its credit limit by Rs.30025-59p.  He was advised that since there was a possibility of decline for an authorization on transaction he should avoid further usage of the card in question. He was asked to clear the over limit amount (more if possible) immediately so that he could resume using his card. The complainant has put a heavy reliance on a letter dated 30.11.04 (copy Annexure P-5) to show that vide this letter the OP No.1 had tendered their apology to his late father.  No doubt, in the said letter the OP No.1 had apologized for the incident but, however, no where in the said letter it has been stated that his deceased father’s visa card account had not exceeded the credit limit or had the over limit amount. Therefore, there is reason to believe that on the date of renewal of the policy in question on 08.12.04 the deceased father had no amount in his SBI visa card to pay for the installment of Rs.694/- for the renewal of the policy in question. 

We are of the considered opinion that neither the OP No.1 nor OP No.2 can be held responsible for lapsing of the Personal Accidental Insurance Policy of the deceased father of the complainant before his death. On the date of his death he had no such valid insurance policy in his name or favour. Hence, the repudiation of the claim of the complainant was perfectly justified and was according to the terms and conditions of the policy in question. Hence, we hold that neither of the OPs is guilty of deficiency in service.

In view of the above discussion, we do not find any merit in the complaint and dismiss it with no order as to costs.

Let a copy of this order be sent to the parties as per regulation 21 of the Consumer Protection Regulations.  Thereafter file be consigned to record room.

Announced on 31.05.17.