Karnataka

Chitradurga

CC/84/2014

Sandya her Natural Gardian Smt, Savitharamma W/o.B.A.Srinivas - Complainant(s)

Versus

The Branch Manager, L.I.C. - Opp.Party(s)

Shri.Dinesh Kumar S

02 Sep 2015

ORDER

COMPLAINT FILED ON : 17/10/2014

     DISPOSED ON: 02/09/2015

 

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, CHITRADURGA

 

CC. NO. 84/2014 DATED:  2nd September 2015

 

PRESENT :-     SRI. T.N. SREENIVASAIAH      PRESIDENT                                      B.A., LL.B.,

                        SRI.H.RAMASWAMY,               MEMBER

                                         B.Com., LL.B.,(Spl.)

SMT.G.E.SOWBHAGYALAKSHMI,       

                                         B.A., LL.B.,                   MEMBER

                               

 

COMPLAINANT	Sandya, D/o Late B.S. Venkatesh, Minor, her minor guardian Smt. Savithramma, W/o B.A. Srinivas, R/o Doddaullarti, Challakere TQ, Chitradurga.   (Rep by Sri. S. Dinesh Kumar,  Advocate)
OPPOSITE PARTIES	1. The Branch Manager,      LIC of India, Challakere.   2.  The Claim Related      Manager,      Divisional Office,      LIC of India, Shimoga.   3.  The Manager (Claims),      Divisional Office,      LIC of India, Shimoga.     (Rep by Sri. L. Madhusudhan,  Advocate)

 

 

SRI. T.N. SREENIVASAIAH. PRESIDENT.

ORDER

 

The above said complaint has been filed by the complainant U/s 12 of C.P. Act 1986 for the relief to direct the Opposite parties to pay Rs.1,00,000/- towards sum assured under the policy and other benefits and for costs, interest etc.  

2.     Brief facts of the case of the complainant are that, her son late B.S. Venkatesh during his life time has taken Jeevan Ankur insurance policy bearing No.629636180 on 28.02.2012 and he paid all the premium amounts without fail and the premium amount was Rs.2,879/-.  Unfortunately, he died on 13.04.2014 in a motor vehicle accident.  To the said policy he made his daughter Kum. Sandhya as a nominee.  She is a minor, so her grand-mother i.e., complainant was appointed as an appointee.  After the death of her son, complainant made a claim by producing all the documents but, the OPs failed to pay the sum assured and the accidental benefits.  Complainant approached the OPs several times and written a letter but, it went in vain.  Complainant got issued a legal notice on 02.08.2014 through her Advocate by way of RPAD and the OPs written a reply to the said notice saying that, the policy was in lapsed condition due to non-payment of premium.  But, the son of complainant has paid all the premiums during his life time.  Unfortunately, he died on 13.04.2014, therefore, he has not paid the last premium so, complainant has not admitted that the policy was in lapsed condition.  The OPs have not sent intimation letter for payment of premium amount and therefore, she is entitled to claim the amount covered under the policy.  The death of policy holder was unfortunate, unexpected and un-natural one.  The repudiation of the claim of complainant was illegal.  Hence, there is a deficiency of service on the part of OPs and so, she sustained financial loss and mental agony and etc., and prayed for allow the complaint.

 

        3. On service of notice, OPs have appeared through Sri. L. Madhusudhana, Advocate and filed written version stating that, one B.S. Venkatesh had taken a half yearly insurance policy bearing No.629636180 i.e., Jeevan Ankur from the OPs for a sum assured amount of Rs.1,00,000/- under table and term was 807-16-16 and the date of commencement was 28.02.2012 with premium installment of Rs.2,879/-.   He made her daughter Kum. Sandhya as a nominee under the policy paid up to 8/2013 on 30.10.2013 and first unpaid premium was 2/2014.  It is further submitted that, it is not correct to say that, during his life time, he paid all the premiums without any default.  The deceased life assured has not paid the premium due on 02/2014 even he died on 13.04.2014.   It is admitted that, the deceased life assured had taken Jeevan Ankur insurance policy from the OPs and made his daughter Kum. Sandhya as a nominee and her grand-mother Smt. Savitramma as an appointee under the policy since his daughter was a minor.   The averments made in para 4 of the complaint are denied as false.  After receipt of the claim intimation and proof of death, OPs came to know that, the policy was under lapsed condition for non-payment of premium due on 02/2014.  Only two years premium have been paid and the lapsed period was more than one month.  Condition for payment of premium as per condition No.2 of the policy issued which reads as under:

"A grace period of one month but not less than 30 days will be allowed for payment of premium of yearly, half yearly or quarterly premiums and 15 days for monthly premium.  If death occurs within this period and before the payment of the premium then due, the policy will still be valid and the sum assured paid after deduction of the said premium as also unpaid premium falling due before the next anniversary of the policy.  If the premium is not paid before the expiry of the days of grace, the policy lapses".   

 

Under the above policy grace period expired on 28.03.2014 and life assured died on 13.04.2014 and the policy was under lapsed condition and the nominee is not eligible for any claim.  After due verification, it is found that, the premiums are paid for two years and lapsed period was within three months.  As per the Chairman's special relaxation rules 1987 claim between 2 to 3 years is considered as under:

1. Wherein the lapse period was within 3 months, sum assured is payable.
2. Wherein the lapse period was between 3 to 6 months half of the sum assured is payable.
3.  Wherein the lapse period was between 6 to 12 months, refund of premium.

 

In the present policy the lapsed period was 1 month and 15 days and this OPs considered the claim as per the above rules and settled the claim on ex-gratia basis after obtaining the discharge form dated 07.07.2014 in response to OPs letter dated 02.07.2014 and the appointee submitted the discharge form containing the word received the amount in full and final settlement of the claim under the above said policy.  The OPs have not settled the double accident benefit since the policy was under lapsed condition and for the payment of double benefit, policy should be in force so, this OPs are not liable to pay any claim under a lapsed condition.  As per para No.11 of policy conditions, the double benefit claim payable only if the policy is in force as on the date of death and the grace period was expired on 28.03.2014 and the date of death was 13.04.2014 and hence, the policy was in lapsed condition as on the date of death.  As per policy condition OPs have settled all the benefits and not settled the double accident benefit.  It is not correct that premiums under the policy are paid regularly.    In view of the above stated facts OPs have rightly repudiated the claim and etc., and prayed for dismissal of the complaint.

 

        4. Complainant himself examined as PW-1 by filing affidavit evidence and got marked Ex A-1 to A-10.

 

        5. OPs have examined one Sri. K.R. Mohan, Manager (L & HPF), LIC of India as DW-1 by filing affidavit evidence and got marked Ex B-1 to B-7.  

 

        6. Arguments heard.

 

 

7. Now the Points that arise for our consideration for the decision of the complaint are that:

 

Point No.1:- Whether the complainant proves that, her son B.S. Venkatesh died in a motor cycle accident and the OPs have repudiated the double benefit claim under Jeevan Ankur policy bearing  No.629636180 of her son and thereby complainant has sustained financial loss and mental agony and OPs have committed deficiency of service and entitled for the relief as prayed in the complaint?

 

 

Point No.2:- What order?

 

        8. Our findings on the above points are as follows:

 

        Point No.1:- Negative.

        Point No.2:- As per the final order.

 

                                ::REASONS::

 

9. Point No. 1:- It is not in dispute that, son of the complainant late B.S. Venkatesh during his life time had taken Jeevan Ankur insurance policy bearing No.629636180 on 28.02.2012 and he was regular in making payment of premium amount of Rs. 2,879/- without fail.  He died in a motor vehicle accident on 13.04.2014 and he made his daughter Kum. Sandhya as a nominee.  As she was a minor, he made his mother i.e., complainant as an appointee.  After the death of her son, complainant made a claim by producing all the documents but, the OPs paid only the sum assured amount but repudiated to pay the accident benefit for Rs.1,00,000/- on the ground that, the policy was in lapsed condition due to non-payment of last premium.   The contention of the complainant is that her son paid all the premiums during his life time.  Unfortunately, he died on 13.04.2014, therefore, he has not paid the last premium so, she has not admitted that the policy was in lapsed condition. Complainant approached the OPs several times and written a letter but, it went in vain.  The OPs have not sent any intimation letter for payment of premium amount and therefore, she is entitled to claim the double benefit amount covered under the policy.  Hence, there is a deficiency of service on the part of OPs and thereby she sustained financial loss and mental agony and OPs have committed deficiency of service and so, this complaint has been filed. 

 

       10.  In support of her contentions,  complainant has relied on his affidavit evidence in which she has reiterated the contents of complaint.  Complainant has also riled on documents like copy of letter dated 25.07.2014 requesting to pay special benefit which is marked as Ex.A-1.  Copy of postal receipt and postal acknowledgement are marked as Ex.A-2.  Copy of letter dated 30.07.2014 issued by the OP is marked as Ex.A-3 informing the complainant that the policy was in lapsed condition so, no special benefit will be payable.  Copy of Legal notice issued to OPs which is marked as Ex.A-4.  The postal receipts and postal acknowledgements are marked as Ex.A-5 and Ex.A-6.  Ex.A-7 is the copy of letter issued by the OPs stating that the policy is in lapsed condition due to non-payment of premium from 28.02.2014 so, the accident benefit and other benefits are not payable.  Ex.A-8 is the PM report.  Ex.A-9 is the spot panchanama and Ex.A-10 is the death certificate of deceased policy holder.       

 

       11.  On the other hand, it is admitted by the OPs that, deceased had taken an insurance policy for a sum assured of Rs.1,00,000/- which includes the accident benefit but, the policy was under lapsed condition and the complainant is the mother of deceased policy holder and the daughter of life assured is made as a nominee under the policy as per condition No.2 of the policy the grace period for payment of premium was one month but, in the present case the lapse period was one month 15 days.    So, OPs have rightly repudiated the accident benefit claim of the complainant and complaint itself is not maintainable etc., and prayed for dismissal of the complaint.

 

       12.  In support of its contentions, OPs have relied on the copy of insurance policy, which is marked as Ex.B-1, Ex.B-2 is the repudiation letter dated 30.07.2014.  Ex.B-3 is the status report issued by the OP.  Ex.B-4 is the Death Certificate of lfe assured.  Ex.B-5 is the copy of receipt for having received Rs.1,00,000/- on ex-gratia basis.  Ex.B-6 is the letter to be sent with discharge form in cases of ex-gratia claims by the OPs.  Ex.B-7 is the Policy Servicing Manual No.11. 

 

       13.  On the basis of the above said affidavit and documentary evidences, Sri. S. Dinesh Kumar, Advocate for the complainant has argued that, admittedly son of complainant deceased B.S. Venkatesh had taken an Jeevan Ankur insurance policy from the OPs and he made his daughter as a nominee who is minor.  He was regular in making payment of the premiums.  Unfortunately, he died on 13.04.2014 in a motor vehicle accident and OPs have illegally repudiated the claim on the ground that, the policy was in lapsed condition and thereby committed deficiency of service and complainant is entitled for the relief etc., and prayed for allow the complaint.

 

14.  On the other hand, Sri. L. Madhusudhana, Advocate for the OPs have strongly resisted the said contentions stating that, as per the terms and conditions of the policy they have settled the claim of the complainant and repudiated the accident benefit as the policy was in lapsed condition and so claim of the complainant is not maintainable and complaint is liable to be dismissed. 

 

15.  Ex.B-7 Policy Servicing Manual No.11 in Section 4 at page 88 reads as under:

 

4. Relaxation in the matter of settlement of Death Claim under Policies where premiums were paid for full two years.

 

1. The following relaxations are now made in respect of Death Claims arising by the Death of the life assured on or after 1.10.1987.

 

After at least two full years premiums have been paid under a policy.

 

1.  If the death of the Life Assured were to occur after expiry of Days of Grace but within three months of the due date of the first unpaid premium, consideration of claim to the extent of the full sum assured together with the declared bonuses subject to recovery of the unpaid premiums. 
2. If the death of the Life Assured were to occur between three and six months of the due date of the first unpaid premium, consideration of claim to the extent of half the sum assured and
3. If the death of the Life Assured were to occur between six months and one year of the date of the first unpaid premium, consideration of claim to the extent of a proportionate notional paid-up value on the basis of actual premiums paid.   

 

 

16.  In the present case, in the version filed by the OPs it is stated that, the premium under the policy was paid up to 08/2013 on 03.10.2013 and first unpaid premium was 02/2014 and the life assured died on 13.04.2014.  As per the Policy Servicing Manual Sec.4, Relaxation in the matter of settlement of Death Claim under Policies where premiums were paid for full two years, the death of the Life Assured was to occur after expiry of Days of Grace but within three months of the due date of the first unpaid premium, consideration of claim to the extent of the full sum assured together with the declared bonuses subject to recovery of the unpaid premiums. But, in the present case, the life assured has not paid the premiums for full two years, if the life assured paid the last premium i.e., due on 02/2014, then the complainant has a right to claim the accident benefit.  Therefore, the complainant is not entitled to claim accident benefit.   

 

17.  On hearing the rival contentions of both the sides and on careful perusal of the entire records, it clearly shows that, OPs have rightly repudiated the claim of complainant and hence, we are of the considered opinion, she is not entitled claim the  relief as prayed for in the complaint.  Accordingly, this Point No.1 is held as negative to the complainant.

 

        18.   Point No.2:- As discussed on the above point and for the reasons stated there in we pass the following.

 

ORDER

        It is ordered that the complaint filed by the complainant U/s 12 of CP Act 1986 is hereby dismissed.

 

Parties to bear their own costs.

                       

(This order is made with the consent of Members after the correction of the draft on 02/09/2015 and it is pronounced in the open Court after our signatures.)         

 

 

MEMBER                   MEMBER                      PRESIDENT

 

 

-:ANNEXURES:-

Complainant by filing affidavit evidence taken as PW-1 Witness examined on behalf of complainant:

                                                -Nil-

 On behalf of OP Sri. K.R. Mohan, Manager, (L & HPF), LIC of India as DW-1 by filing affidavit.

Witnesses examined on behalf of OP:

-Nil-

Documents marked on behalf of complainant:

01	Ex-A-1:-	Copy of letter dated 25.07.2014 requesting to pay special benefit.
02	Ex-A-2:-	Copy of postal receipt and postal acknowledgement are marked as Ex.A-2.
03	Ex-A-3:-	Copy of letter dated 30.07.2014 issued by the OP
04	Ex-A-4:-	Copy of Legal notice issued to OPs
05	Ex-A-5:-	The postal receipts
06	Ex-A-6:-	Postal acknowledgements
07	Ex-A-7:-	Copy of repudiation letter issued by the OPs
08	Ex-A-8:-	PM report.
09	Ex-A-9:-	Spot Panchanama
10	Ex-A-10:-	Death certificate

 

Documents marked on behalf of Opponent:

 

01	Ex-B-1:-	Copy of insurance policy.
02	Ex-B-2:-	Repudiation letter dated 30.07.2014.
03	Ex-B-3:-	Status report issued by the OP.
04	Ex-B-4:-	Death Certificate of life assured.
05	Ex-B-5:-	Copy of receipt for having received Rs.1,00,000/-
06	Ex-B-6:-	Letter to be sent with discharge form in cases of ex-gratia claims.
07	Ex-B-7:-	Policy Servicing Manual No.11.

 

 

MEMBER                   MEMBER                      PRESIDENT

Rhr.