DISTRICT CONSUMER DISPUTES REDRESSAL FORUM-II, U.T. CHANDIGARH

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Ramandeep Kaur d/o Sh. Prem Chand, #2165/2, Sector 45-C, Chandigarh – 160 047 (U.T).

                   --- Complainant

V E R S U S

1]      TATA AIG Life Insurance Company Limited, SCO No. 107-108, 2^nd Floor, Sector 43-B, Chandigarh.

2]      TATA AIG Life Insurance Company Limited, 6^th Floor, Peninsula Corporate Park, Ganpatrao Kadam Marg Office, Senapati Bapat Marg, Lower Parel, Mumbai – 400013.

---- Opposite Parties through its Directors.

BEFORE:      SH. LAKSHMAN SHARMA                    PRESIDENT

MRS.MADHU MUTNEJA                       MEMBER

                   SH.JASWINDER SINGH SIDHU             MEMBER

Argued By:             Sh. Harsh Manocha, Counsel for Complainant.

None for Opposite Parties.

PER JASWINDER SINGH SIDHU, MEMBER

1.                Briefly stated, the father of the Complainant made a proposal for Policy No. U-178954017 and paid an initial premium of Rs.10,000/- on 06.07.2010. It is alleged that when the Opposite Parties failed to deliver policy document at the permanent address provided with the proposal form, which is a mandatory requirement for log in of policy by Insurance Regulatory & Development Authority, the same was brought to the notice of the Opposite Parties, by the father of the Complainant who is also a proposer, vide letters dated 13.6.2011, 17.11.2011, 02.01.2012, 25.01.2012, but to avail. Even seeking information with regard to the disputed policy vide letter dated 21.02.2012 under the RTI Act, 2005, did not yield any results as neither the information was given nor the policy documents were supplied. According to the Complainant non deliverance of the policy documents had deprived her of her valuable right to scrutinize and to appreciate the terms & conditions of the Policy and to exercise her right of rejection under the free look period, as down by under the IRDA Guidelines, which accounts to deficiency in service and unfair trade practice. Hence, the present complaint.

2.                Notice of the complaint was sent to Opposite Parties seeking their version of the case.  

3.                Opposite Parties in their joint reply, while contesting the claim of the Complainant have pleaded that the policy holder alone could initiate any proceedings in respect of the policy for cancellation or otherwise. No letter seeking refund or complaint regarding non-receipt of policy was ever made by the Complainant at any stage. Only certain communications were addressed by the proposer Prem Chand. It is asserted that a proposer has no right in respect of the policy. A proposer is one who only pays the money for policy or who pays the premium of the policy. In the present case, the life assured/ policy holder is different from the proposer. A proper could not in any manner intervene in or ask for cancellation of the policy. The same can be done only by the life assured. No complaint qua non delivery or refund was filed by the life assured nor has any communication in respect of non receipt of the policy been made by the policy holder, nor has there been any complaint that the policy has not been delivered to the policy holder.  It is also pleaded that the address of the policy holder and the proposer are different. The policy was not required to be delivered to the proposer and the Complainant has never raised a complaint qua the same. The policy holder has neither applied for cancellation nor has made any request for cancellation in the free look in period. Denying all other allegations and stating that there is no deficiency in service or unfair trade practice on their part, answering Opposite Parties have prayed for dismissal of the complaint.  

4.                Parties were permitted to place their respective evidence on record in support of their contentions.

5.                On 10.05.2013, when the case was fixed for arguments, none appeared on behalf of Opposite Parties. Therefore, we proceeded to dispose of this complaint on merits under Rule 4 (8) of the Chandigarh Consumer Protection Rules, 1987 read with Section 13(2) of the Act (as amended upto date) even in the absence of opposite parties.

6.                We have heard the learned counsel for the Complainant and have perused the record, along with the written arguments advanced by the learned counsel for the Opposite Parties.

7.                The Complainant has preferred the present complaint against the Opposite Parties on the ground that she was the life assured in the proposed policy subscribed by her father by paying an initial premium of Rs.10,000/- on 6.7.2010. The Complainant has made a specific allegation that the Opposite Parties failed to deliver the policy documents at her permanent address provided in the proposal form. Even the repeated notices vide letters dated 13.06.2011, 17.11.2011, 02.01.2012 and 25.01.2012 fell on the deaf ears of the Opposite Parties. The Complainant even took recourse via RTI Act, 2005, but that too did not yield any results. The Complainant alleges that in the absence of receipt of policy documents she could not exercise her right of either acceptance or rejection of the said policy under the free look period option as laid down by the Insurance Regulatory & Development Authority.

8.                The Opposite Parties while defending themselves have tried to circumvent the issue by claiming that the address mentioned in the proposal form is different than the address on which the Complainant wanted his policy document to be delivered and the same can be ascertained from the clause in the application form (R-1), wherein the Complainant herself having changed her residential address from #2165/2, Sector 45-C, Chandigarh to SCO No.361, 2^nd Floor, Sector 32-D, Chandigarh. Interestingly, the said change in the address has not been initialized by the proposer who filled up the form. Even further, the same address is found repeated in the next col. of permanent residential address i.e. #2165/2, Sector 45-C, Chandigarh. The same address is also found mentioned on pg. 8 of Annexure R-1. 

9.                The Opposite Parties have claimed that the Complainant has not filed any complaint on the non-delivery of the policy document, nor there is any request of refund of the premium amount for the reasons mentioned in the complaint. Hence, no case of deficiency in service is made out qua them. Though the Opposite Parties have stood their ground of the delivery of the policy document at the Complainant’s end, but at the same did not bring any cogent proof to substantiate their stand, as the Hon’ble National Consumer Disputes Redressal Commission in the case titled as Oriental Insurance Company Vs. Charan Dass (Revision Petition No. 1324 of 2012), decided on 01.08.2012, has already held that the onus to prove the delivery of the policy document lay at the door o the insurance company. Hence, in the absence of any cogent, reliable and trust worthy evidence, the reply/ version of the Opposite Parties is hollow and deserves no merit.

10.              Even if we believe the claim of the Opposite Parties that no request for refund was forthcoming before filing of the complaint, there is no objection with regard to the relief claimed by the Complainant wherein she has desired refund of her premium amount. The Opposite Parties while contesting such claim of the Complainant could have made this offer as per the terms & conditions of the policy, as is evident that she no longer wanted to continue the policy as she did not pay the subsequent premiums. To our mind, the present case of the Complainant is squarely covered under the provisions of the Insurance Regulatory and Development Authority (Treatment of Discontinued Linked Insurance Policies) Regulations, 2010, as notified vide notification dated 1.7.2010,  Regulation 7 of which reads as under:-

“ Obligation of an insurer upon discontinuation of a policy

7.         The obligation of an insurer in this regard shall be as follows:-

i.          To impose discontinuance charges only to recoup expenses incurred towards procurement, administration of the policy and  incidental thereto.

ii.         To design the discontinuance charges to encourage the policyholder to continue with the contract for the full term;

iii.        To ensure that the discontinuance charges reflect the actual expenses incurred.

iv.        To structure the discontinuance charges within the statutory ceiling on commissions and expenses and

v.         To ensure that the charges levied on the date of discontinuance (as a percentage of one annualized premium) do not exceed the limits specified below:-

 Ap- Annualised premium

Fv- fund value on the date of discontinuance

Provided that where a policy is discontinued, only discontinuance charge may be levied by the insurer and no other charges by whatsoever name called shall be levied.

Provided that no discontinuance charges shall be imposed on single premium policies and on top ups.”

                   Hence, in the given situation, the Complainant is very much entitled to the premium amount minus the discontinuation charges, as applicable in the aforesaid Regulation 7 ibid.

11.              In the light of above observations, we are of the concerted view that the Opposite Parties are found deficient in giving proper service to the complainant. Hence, the present complaint of the Complainant deserves to succeed against the Opposite Parties, and the same is allowed, qua them. The Opposite Parties are directed, jointly and severally, to:-

[a]     To pay the premium amount of Rs.10,000/- - Rs.2000/- = Rs.8,000/- to the Complainant, as per above mentioned Regulation 7;

[b]     To pay Rs.3,000/-on account of deficiency in service and causing mental and physical harassment to the Complainant; 

[C]    To pay Rs.2,000/- as cost of litigation;

12.              The above said order shall be complied within 45 days of its receipt by the Opposite Parties; thereafter, they shall be liable for an interest @18% per annum on the amount mentioned in per sub-para [a] & [b] of para 11 above, apart from cost of litigation of Rs.2,000/-, from the date of institution of this complaint, till it is paid.  

13.              Certified copy of this order be communicated to the parties, free of charge. After compliance file be consigned to record room.

Announced

21^st May, 2013.                                        

Sd/-

(LAKSHMAN SHARMA)

PRESIDENT

Sd/-

 (MADHU MUTNEJA)

MEMBER

Sd/-

(JASWINDER SINGH SIDHU)

MEMBER