By Sri. A.S. Subhagan, Member:-
This Consumer Complaint is filed under section 35 of the Consumer Protection Act 2019.
2. Facts of the case in brief:- The Opposite Parties introduced a policy called LIC’s Jeevan Saral (With profits). The agent of the Opposite Party Late Balakrishnan approached the Complainant and assured the Complainant that the maturity value of the policy will be Rs.1,96,032/-as per LIC’s Jeevan Saral (With profits). Believing the words and assurance of the agent of the Opposite Parties, this Complainant had taken an insurance policy No.794164047 on 10.05.2005 .The monthly premium payable as per the policy was Rs.1,021/-. As per the policy the maturity sum insured was Rs.1,96,032/- with additional death benefit sum assured of Rs.2,50,000/- and accident benefit sum assured Rs.2,50,000/-. The Opposite Party issued the policy on 09.06.2005. The Complainant had paid the monthly insurance premium regularly without any default from 10.05.2005. Since the policy was matured on 10.05.2021, Complainant approached the Opposite Party No.1 with a claim of maturity value with bonus, loyalty and profit. The total premium amount paid by the Complainant during the policy period was Rs.1,96,032/. But on maturity Opposite Party No.1 had paid only Rs.1,41,750/- as maturity benefit and Rs.80,089/- towards bonus after deducting Rs.3,063/- towards unpaid premium Rs.71/- as interest on premium and other deduction Rs.13.66/-The Opposite Party paid only a sum of Rs.2,18,690/- on 10.05.2021. Whereas On 24.09.2020, Opposite Party No.1 had issued a letter stating that “the Jeevan Saral Policy issued by us, it has come to our notice that in your policy, there has been a typographical error while printing the schedule in policy document. Accordingly we give below correct schedule in respect of above mentioned policy”. There it is mentioned that the maturity sum assured as Rs.1,41,750/-. The Complainant sent a letter to the Opposite Party No.1 on 27.04.2021, raising his objections. Complainant had taken the policy and had paid the premium without committing any default. The denial of the matured policy amount of Rs.1,96,032/- with proportionate Bonus and other benefits to this Complainant amounts to deficiency of service, unfair trade practice and exploitation. In fact the Complainant had paid insurance premium of Rs.1,96,032/– regularly and is entitled to get the maturity value of the policy of Rs.1,96,032/– with proportionate bonus and other benefits . The Complainant is entitled to get Rs.54,282/- towards balance assured maturity value of the policy with proportionate bonus and loyalty, The Complainant estimates Rs.50,000/- towards compensation for the deficiency of service/unfair trade practice and exploitation suffered by the Complainant and Rs.10,000/- towards cost of this proceedings. The cause of action of this complaint arose on 10.05.2021 when the Opposite Parties partially paid the policy amount and denied the balance matured amount as assured in the policy. Hence prayed to pass an order directing the Opposite Parties to pay
- Rs.54,282/–towards balance assured maturity value of the policy with proportionate bonus and loyalty,
- Rs.50,000/– towards compensation and
- Rs.10,000/– towards cost of this proceedings.
3. Upon getting notice, the Opposite Parties appeared before the Commission and filed joint version for Opposite Party No.1 and Opposite Party No.2.
4. Contents of version:- The above complaint is filed for getting compensation on account of deficiency of service on the part of the Opposite Parties. Prima facie there is no default in service on the part of Opposite Parties and the complaint is liable to be dismissed. The present Complaint is false, frivolous, vexatious and abuse of process of the Commission and therefore, liable to be dismissed under Consumer Protection Act. The complaint filed by the Complainant is not maintainable either in law, facts and circumstances to this case and is liable to be dismissed. The Complainant has absolutely no cause of action to sue against the Opposite Party. Being an unnecessary party, at this stage, the Complainant is liable to pay compensatory cost to this Opposite Party as is unnecessarily dragged in to the Court. It is true that Sri. Devassia. P. M (Complainant) had taken Life Insurance Policy No.794164047 from our Kalpetta Branch details of which are as follows:-
Date of Commencement of the policy dated : 10.05.2005
Sum Assured : Rs.2,50,000/-
Premium : Rs.3.063/-
Mode of Premium remittance Qty Plan. : 165 (Jeevan Saral)
Policy Term : 16 years
Premium paying term : 16 years
Maturity sum assured : Rs.1,41,750/-
5. The Opposite Parties had sent a letter to the Complainant (Life assured) informing the correct Maturity Sum assured which is Rs.1,41,750/- instead of Rs.1,96,032/- which was a typographical error crept in the policy bond. The Opposite Party before maturity date of the alleged policy had informed the life assured (Complainant), the maturity amount i.e. Rs.1,41,750/- and the same is received by the Complainant and the Opposite Party calculated the maturity amount as per the terms and conditions of the said policy. Due date of maturity of the alleged policy was on 10.05.2021 and an amount of Rs.2,21,831/- (MSA Rs.1,41,750/- and loyalty addition Rs.80,089/-) was sent to the Life assured on 29.06.2021 through NEFT through Complainant’s account (Devassia) as per policy conditions. The policy Jeevan Saral Belongs to the category of high risk plans, wherein the insurance coverage offered is substantially higher, especially at higher ages. The unique feature of this plan is that the instalment premium to be paid is determined by the customer and the sum assured is payable in the unfortunate event of death, known as death sum assured which is then decided on the basis of the premium thus selected. The maturity sum assured, unlike in conventional plans, is calculated depending upon the age of the life assured and the term of the policy. The death sum assured under this plan is 250 times the monthly premium selected by the customer. In all other conventional insurance plans, the instalment premium payable for the same sum assured varies according to the age of the customer. However, in this plan, the premium payable and death sum assured remains the same irrespective of age. In any traditional life insurance policy the premium charged for covering the risk increases as one’s age increases. This means that for the same death sum assured, the premium payable varies for two customers having different ages. This is because the cost of providing death cover increases with age. Whereas, in Jeevan Saral Plan, the premium and death benefit are selected by the customer and remains the same irrespective of age. Hence, the maturity value is calculated based on age and duration of the policy. Thus when the age when the policy is purchased is on the higher side, the maturity value is lower. In this plan there is a concept of different sum assured for maturity and death. In case of death, the benefits payable are death sum assured and return of premiums paid excluding 1st year premium and extra premiums if any collected. This policy offers a very high risk cover for a low premium. The maturity sum assured will vary according to age. There is no deficiency of service on the part of the Opposite Party as alleged in the complaint by the Complainant and hence it is denied that the Complainant is entitled for getting the amount and compensation as prayed for in the complaint and the Complainant is to put strict proof thereof. There is no deficiency of service from the part of Opposite Party and the complaint is totally denied by this Opposite Party, especially prayer clause of the complaint. The alleged claim raised by Complainant is not in accordance with the condition and privileges mentioned in the policy and hence it is prayed the case may be dismissed.
6. The Complainant filed proof affidavit, Ext.A1 to A5 and X1 series marked from his side and he adduced oral evidence as PW1. Opposite Party No.1 also filed proof affidavit. Ext.B1 to B5 were marked from their side and the Divisional Manager of LIC was examined as OPW1 on behalf of Opposite Party No.1 and Opposite Party No.2 and the complaint was finally heard on 27.02.2024.
7. Considering the complaint, version and affidavits, Exhibits marked, oral evidences adduced, the arguments of the Counsels for the Parties to the complaint and the facts and circumstances of the case, we raised the following points for deciding the case.
- Whether there has been deficiency in service or unfair trade practice from the part of the Opposite Party?
- Relief and Cost…?
8. Point No.1:- The main allegation of the Complainant is that though he was the holder of the policy mentioned in the complaint with maturity value of Rs.1,96,032 + bonus + Royalty and profit, he was given a maturity value of only Rs.1,41,750/- + 80089 towards bonus. According to the Complainant, he is entitled to get Rs.54,282/- towards balance assured maturity value of the policy with proportionate bonus and loyalty. On the other hand, the contention of the Opposite Party is that there was a typographical error as to the entry of maturity value in the policy bond. Instead of recording the maturity value of Rs.1,41,750/- it was wrongly recorded as Rs.1,96,032/- which was duly informed to the Complainant before maturity. Commission on perusal of the documents, the following facts are revealed.
- Policy documents reveal that the policy was commenced from 10.05.2005 (Ext.A1).
- The Maturity value is recorded as Rs.1,96,032/- (Ext.A1).
- The date of maturity of the policy is 10.05.2021 (Ext.A1).
- Ext.A2 is the Letter issued by the Opposite Party on 24.09.2020 to the Complainant informing that there has been a typographical error while printing the schedule in policy document.
- Through Ext.A3 the Complainant had requested the Opposite Party to disburse the full amount of maturity value as already had offered by the Opposite Party in the policy document.
- The request of the Complainant as per Ext.A3 is seen rejected by the Opposite Party as per Ext.A4.
- Ext.A5 shows that the Opposite Party had disbursed only Rs.1,41,750/- as the maturity value + bonus etc.
9. In the present case, the Complainant’s policy had a maturity value of Rs.1,96,032/- but on maturity, the Opposite Party had disbursed only Rs.1,41,750/- stating that there was a typographical error in recording the maturity value on the policy document and stating that they had intimated this matter to the Complainant on 24.09.2020. The policy commenced on10.05.2005 and ended on 10.05.2021 ie, the period of policy was 16 years. But it is seen that the typographical error as narrated by the Opposite Party has been intimated to the Complainant only on 24.09.2020 ie very long after 15 years of commencement of the policy and thereby denied Rs.54,282/- being maturity value and the proportionate bonus etc. Usually insurance policies are taken by the general public believing and on the basis of the offers made by the insurance companies at the time of joining the policies. If there had been any typographical or other reasonable mistakes, it would have been intimated to the policy holders within a reasonable time and a chance would have been given to the policy holders to decide as to whether they have to continue the policy or withdraw from it. Here, the Opposite Party has failed to inform the typographical error, if any occurred, within a reasonable time and also failed to give a chance to the policy holders to decide either to continue with the policy or to quit from it, as the maturity value offered was changed. Instead after offering a higher amount as maturity value and only after completion of 15 years out of a total of 16 years of policy period the Opposite Party unilaterally reduced the policy maturity value and other policy benefits to their own benefits and grabbed the policy amount of the Complainant which is against the principle of natural justice, deficiency of service and unfair trade practice. So, there has been deficiency in service/unfair trade practice on the part of the Opposite Party. Hence, Point No.1 is proved against the Opposite Party.
10. Point No.2:- As Point No.1 is proved against the Opposite Party, they are liable to compensate the Complainant.
In the result, the complaint is partly allowed and the Opposite Party is directed to
- Pay Rs.54,282/- (Rupees Fifty Four Thousand Two Hundred and Eighty Two Only) towards the balance maturity value of the policy and the proportionate bonus and loyalty in respect of the policy.
- Pay Rs.25,000/- (Rupees Twenty Five Thousand Only) towards compensation for deficiency in service/unfair trade practice and
- Pay Rs.10,000/- (Rupees Ten Thousand Only) towards cost of this complaint.
The above amounts shall be paid to the Complainant within one month from the date of receipt of this Order, failing which the amount will carry interest @ 9% per annum.
Dictated to the Confidential Assistant, transcribed by him and corrected by me and pronounced in the Open Commission on this the 27th day of March 2024.
Date of Filing:-29.07.2021.
PRESIDENT(I/C) : Sd/-
MEMBER : Sd/-
APPENDIX.
Witness for the Complainant:-
PW1. Devassia. P. M. Retired Employee.
Witness for the Opposite Party:-
OPW1. Beena. K. LIC, Manager (L&HPF)
Exhibits for the Complainant:-
A1. LIC’s Jeevan Saral Policy Schedule.
A2. Letter. Dt:24.09.2020.
A3. Copy of Letter. Dt:27.04.2021.
A4. Letter. Dt:03.05.2021.,
A5. Copy of Receipt.
X1 (Series). Copy of Proposal Paper, Policy document, letter and claim working
sheet and claim disbursement voucher copy. (9 pages).
Exhibits for the Opposite Party:-
B1. Copy of Proposal Paper. Dt:09.05.2005.
B2. Copy of LIC’s Jeevan Saral Policy Schedule.
B3. Copy of Letter. Dt:28.06.2021.
B4. Copy of Claim Disbursement Voucher.
PRESIDENT(I/C) : Sd/-
MEMBER : Sd/-
/True Copy/
Sd/-
ASSISTANT REGISTRAR
CDRC, WAYANAD.
Kv/-
