SMT. BANDANA ROY, PRESIDENT.
The gist of the complaint case - The complainant purchased one Income Assured Plan namely BSLI Income Assured Plan bearing Policy No. 006645707 Product Unique Identification No 109N089V01, issued on 23.12.2014 maturity date 23.12.2031 and the policy term was 17 years. Premium paying term was 7 years, name of the Life Assured Mrs. Tapati Kar Pramanik with annual Premium of Rs. 100742/-. The complainant deposited two annual premiums totaling an amount of Rs. 206443.09 Ps. After such two deposit, the OP misguided the complainant and allured to take a loan by saying that a loan of Rs. 61,400/- would not affect the usual run of the policy and the policy would be its fullest extent. Thus although the complainant had no necessity to take loan, the OP instigated to apply for the same and thus issued the loan on 20.01.2017. Unfortunately after availing of such loan, the OP without any information quite whimsically and arbitrarily terminated the policy . the complainant all along was ready to repay the loan amount and continue the said policy but the OP did not give any chance to revive the said policy. Ultimately on 31.08.2017 the complainant issued legal notice upon the OP asking for revival of the policy after taking back the loan amount or to return the premium amount deposited by the complainant but the OP did not bother to reply the said letter.
Under the above circumstances, the complainant has been constrained to file this complaint with prayer for the reliefs as mentioned in the petition of complaint.
After issuing of summons the OP appeared by filing a single written version and prayed for dismissals of the complaint on various grounds.
The specific defense of the OPs is that the complainant submitted duly filled and signed proposal form and the policy has been issued as per the details submitted by the complainant. It is further stated that the complainant never approached the OP with any request for free lock cancellation. In the policy issued in favour of the complainant there was a provision of taking a Policy Loan. Among other conditions it was incorporated that “Assured income payable will be reduced by the outstanding policy loan installments, if any. Any outstanding loan balance will be recovered by us from policy proceeds due for payment before any benefit is paid under the policy. Should the outstanding policy loan balance equal or exceeds the surrender value the policy at any time when the policy is in reduced paid up status, then the policy shall be terminated without any value. Note that prior to this happening we shall give you an opportunity to repay all or part of your outstanding loan balance in order for your policy to continue uninterrupted” The complainant himself is an agent and insurance adviser of the Co and he is supposed to know all pros and cons of the said policy issued in his favor. A letter dated 20.01.2017 was sent to the complainant intimating that his request for loan against policy No 006645707 was processed with effect from January 20, 2017. It is the allegation of the OP that after availing of the loan the complainant never paid any single premium towards repayment of the loan amount and thus for his own negligence the complainant has got his policy terminated and the OP had no deficiency in this regard ; what has been done is quite consistent with the policy terms and conditions.
On the pleadings of the parties as above, the following issues need be considered (1) whether the case is maintainable and whether the complainant is entitled to get the reliefs as prayed for.
DECISION WITH REASONS. .
Both the points are taken of together for discussion for the sake of convenience and brevity.
Perused the complaint and the affidavit in- chief filed by the complaint. Also perused the documents filed in the record on behalf of the petitioner. Perused the questionnaires and the reply filed by the parties against each other and heard the elaborate argument advanced by the Ld advocate for the parties.
The complainant has stated that on the instigation of the opposite party he took loan from the policy and the opposite party then terminated the policy. Accordingly the complainant alleged deficiency of service on the part of the opposite party and has prayed for Rs.206443.09/- along interest, Rs.50000/- as compensation and Rs.10000/- as litigation cost.
The OP issued the policy bearing No.006645707 on 23.12.2014 in the name of Mrs Tapatai Pramanik details of which are the following:-
Application No.- A49503787
Application signed on. - 08/12/2014
Policy No. - 006645707
Name of the Life Assured. - Tapati Pramanik
Name of the policy holder. - Bimal Paramanik
Policy issue date. - 23/12/2014
Policy billing frequency. - Annually
Sum assured. - 415000
Gross Annual Premium with S.T. & Cess. - 103855.10
Total Premium Paid. - 206443.09
Type of Plan.- BSLI Income Assured Plan 17 Years
Current Policy Status - Surrendered
Policy Maturity date.-23.12.2031
Premium paying term and policy term - 7 Years, 17 years.
According to the OP the complainant was given detailed description about features of the policy and complainant also understood the terms and condition before signing the said application. Admittedly the original policy documents along with its terms and condition was dispatch to the complainant under registered post and within the free lock period the complainant did not give objection or return the policy with objection to the OP and duly signed the said documents and sent the same the OP.
Ld. Lawyer for the Opposite Parties argued that as per policy terms and conditions there is a clause with heading “taking a policy loan” where it is mentioned that if the outstanding of the loan amount exceeds the fund value, the policy will be terminated. The OP in form the same by letter dated 20.01.2017 the complainant with informing his request for loan against the policy was processed with effect from 20.01.2017.
The complainant has filed copy of the policy where from terms and conditions of the policy will appear.
We have perused the terms and conditions of the policy of the Opposite Party against taking policy loan. It is written under the “taking policy loan” as minimum “You may take loan against your policy once it has acquired a surrender value the minimum loan amount as Rs.5000/- and the maximum as 85 % of your surrender value. We shall charge interest on the outstanding loan balance at a rate declared by us from time to time based on then prevailing market conditions. Assured income payable will be reduced by the outstanding policy loan installments if any. Any outstanding loan balance will be recovered by us from the policy proceeds due for payment before any benefit is paid under the policy. Should the outstanding policy loan balance equal or exceeds the surrender value of your policy at any time when your policy is in reduced paid up status, then the policy shall be terminated without any value Note that prior to this happening we shall give you an opportunity to repay all or part of your outstanding loan balance in order for your policy to continue uninterrupted.”
We have perused the cross-examination of the complainant by the OP and vice versa.
Ld advocate for the Ops argued that the complainant has not approached the OP with any request for free lock concealment., Hence, the complainant is not stopped from disowning the said risk and in absence of any cause of action against the OP the present complaint is liable to be dismissed.
Ld. Advocate has further referred a decision reported in (2003) CPJ 393 and (2009) CPJ 34 wherein it has been observed that Insurance Policy is to be construed strictly as per the terms and conditions of the policy documents which is binding of contract between the parties and nothing can be added or subtracted by giving a different meaning of the words mentioned therein. Therefore, in light of this the complainant is bound by the terms and conditions of the policy and the OP are not liable to return the policy amount paid by the complainant to the OP Co.
It may be mentioned that Section 2(g) of the C P Act 1986 defined “deficiency “which means any fault, imperfection, short coming or inadequacy in the quality, nature and manner of performance which is required to be maintained in pursuance of a contract.
According to the OP, in the present case the complainant has failed to administer any deficiency on the part of the OP. So, according to the OP, the case is liable to be dismissed
A copy of the proposal form bearing No 006645727 has been filed by the OPs which is Annexure B in this case. A copy of the Pay out request Form dated 10012017 along with policy terms and conditions is Annexure D and a copy of the letter dated 20.1.2017 is Annexed as Annexure D in the case. Seen the documents.
It is also mentioned that the complainant has not raised any quary or doubt which substantiate the fact that he understood the terms of the policy. It has been argued that the complainant has not even paid a single premium after the loan amount was disbursed to him which is against the terms of the policy where it has been mentioned that before any benefit is awarded to the insurer, the outstanding loan will be recovered from the policy proceeds due for payment. Therefore, the OP Company has always worked as per terms and conditions of the said policy and there is no deficiency on their part.
On the above context, the only defence of the OP is that “Assured income payable will be reduced by the outstanding policy loan installments, if any. Any outstanding loan balance will be recovered by us from policy proceeds due for payment before any benefit is paid under the policy. Should the outstanding policy loan balance equal or exceeds the surrender value the policy at any time when the policy is in reduced paid up status, then the policy shall be terminated without any value. Note that prior to this happening we shall give you an opportunity to repay all or part of your outstanding loan balance in order for your policy to continue uninterrupted. “
In this case it is not disputed that the complainant took a loan of Rs. 61,400/- from his policy with certain terms and conditions and he was to repay that amount during the tenure of the policy terms. But nowhere in the record it is found that what was the terms and conditions of the loan i.e rate of interest, terms of repayment or tenure of repayment. Neither of the parties filed any document to substantiate the rate of interest or terms of the repayment.
In the policy certificate, under the head “Reduced paid-up Benefits, it is seen “If you discontinue paying premiums after having paid premiums for at least two full years (three years for 10 year premium paying terms), your policy will not lapse but will continue on a reduced paid up basis. …..” . From the table furnished by the OP in the written version as well as the case of the complainant that the complainant has paid premiums for two full years i.e Rs. 206443.09 at the rate of Rs. 103855.10 plus surcharge. In that event after deducting a sum of Rs. 61,400/- + standard interest, the complainant is entitled to get return of the balance amount when the complainant is not willing to continue the policy any more. Non filing of the necessary document relating to terms and conditions of the loan disbursed to the complainant and interest accrued thereon to substantiate the total amount which may equalize or exceed the paid up value of Rs. 206443.09, preponderance of probability lies in favor of the complainant. In this context we may refer a decision reported in 2018 (2) CPR 503 (NC) wherein it has been held that “Consumer Fora can not be expected to accept terms and conditions of an unconscionable contract between parties which goes against interest of consumers”. By no stretch of imagination it is possible for us to accept the proposition that the loan amount of Rs. 61400/- sanctioned on 20.01.2017and interest accrued thereon has equalized or exceeded the total fund value of Rs. 206443.09 within few months for which the policy has been terminated. The policy was issued on 23.12.2014 and the complainant paid two Annual Premiums of Rs. 206443.09. Loan was issued on 20.01.2017 on the basis of his application dated 10.01.2017 and it is the case of the complainant that just after issuing the loan, the OP terminated the whole policy and did not give the policy holder any chance to revive the same. This contention of the complainant remain unchallenged. This Fora cannot overlook such a whimsical decision to frustrate the interest of a consumer which tantamount to deficiency of service on the part of the OP.
In summing up the above discussion we are of the considered view that the complainant is entitled to the reliefs to some extent.
The complainant has prayed for return of exact amount of two numbers of installments which we can not grant as it is admitted position that the complainant took a loan of Rs. 61,400/- from the OP Company at an yearly rate of interest. So, The Op may be asked to return the premium amount to the complainant after deducting the loan amount along with standard rate of interest.,
Both the issues are decided accordingly.
Hence it is,
O R D E R E D
That CC/ 137 of 2018 be and the same is allowed in part against the OPs.
Both the OPs are directed to return the complainant the amount of total premium paid by the complainant after deducting the loan amount of Rs 61,400/- along with accrued interest thereon at the standard rate within one month from the date of this order, in default, the complainant will be at liberty to put this order into execution.
In view of the merit of the case, the complainant will not get any compensation but is entitled to get litigation cost of Rs. 2000/- within the date as stipulated above.
Let copy of this judgment be supplied to the parties free of cost.
