1. The brief history of the case of the complainant is that he being allured by the massive advertisement through the Agent of the Ops and handouts, illustrations, the complainant proposed the Ops to obtain a policy namely “Bima Accounts-I” on 12.2.2011 which is a guaranteed short term conventional plan. It is submitted that the policy is a short term saving for a period of 5 to 7 years and the complainant opted for 5 years term and deposited Rs.7000/- at the time of proposal on 12.2.2011 being the yearly premium and the Ops also issued policy bearing No.573278882 in favour of the complainant. It is further submitted that the policy bears 6% interest p.a. on deposits besides additional interest but on maturity, the Ops have paid Rs.35, 403/- to the complainant on the deposit of Rs.35000/- and as such the Ops have not paid the assured interest which comes to Rs.2100/-. Thus alleging deficiency in service on the part of the Ops, the complainant has filed this case praying the Forum to direct the Ops to pay the assured interest on the deposits or the differential amount with interest @ 18% p.a. and to pay Rs.50, 000/- towards compensation and costs to the complainant.
2. The Ops filed counter in joint admitting the Policy No.573278882 issued in favour of the complainant and contended that it is a death benefit policy on the life of the complainant but not a money back policy and for the purpose, some percentage of the amount from out of the premiums paid will be deducted and the balance amount will be credited to a separate account which is called as Policy Holder Account. It is further contended that the policy holders accounts consists of 2 leads namely “Policy Holders Regular Premium account” and “Policy Holders Top up Premium Account”. The Ops also further contended that the regular premium accounts is subjected to some deductions like mortality charges and Service Tax and the balance amount premium will earn guaranteed interest @ 6% p.a. The Ops contended that the premium balance of the complainant is Rs.29, 788/- plus interest of Rs.5615/- totaling a sum of Rs.35, 403/- has been paid to the complainant on maturity as per policy conditions. The Ops also contended that the life of the complainant was assured for Rs.98, 000/- for 5 years. Thus denying any deficiency in service on their part, they prayed to dismiss the case of the complainant.
3. Both the parties have filed certain documents in support of their cases. Heard from the complainant as well as A/R for the Ops and perused the materials available on record.
4. In this case the insurance policy under Bima Account-I bearing No.573278882 issued by the Ops in favour of the complainant is an admitted fact. It is seen that the policy obtained by the complainant is for 5 years w.e.f. 12.2.2011 and the same was matured on 16.2.2016 and the complainant has deposited Rs.7000/- every year till 2/2016 totaling Rs.35, 000/-. According to the complainant, the OP.2 floated massive advertisements and distributed handouts and illustrations regarding the benefits under the policy stating that the policyholder’s accounts earns guaranteed annual interest of 6% besides provision of additional interest but at the time of maturity, the Ops failed to keep their promises and paid Rs.35, 403/- to the complainant on the deposit of Rs.35, 000/-. The complainant has filed Claim/Surrender history record from which it is ascertained that the Ops have paid Rs.35, 403/- on maturity to the complainant on 16.2.2016.
5. The Ops stated that the policy in dispute is basically a death benefit policy of the life assured and not a money back policy and for the said purpose, some percentage of the amount from out of the premia has been deducted and appropriated exclusively for the purpose and the balance amount has been credited to the accounts of the policy holder. Accordingly the Ops have deducted 27.5% from the 1st year deposit, 7.5% from the 2nd & 3rd year deposit and thereafter 5% from the deposits of the complainant. Besides the above, the Ops have also deducted mortality charges and Service Tax as per clause 4 (A) & (B) of the policy bond. Thus they have calculated the premium balance as Rs.29, 788/- on which they have given 6% interest i.e. Rs.5615/- which comes to Rs.35, 403/- on maturity.
6. It is seen from the record that prior to proposal the Ops have issued some printed advertisements for the public in English & Odia language duly signed by their Sr. D. M. (OP.2) which do not reflect any symptom that the policy in question is basically a death benefit policy. There does not reflect a single word regarding clause 4 (A) & (B) of the policy bond in the said leaflets and handouts signed by OP.2. It has been clearly mentioned in the said papers that policy holders accounts earns only interest of 6% besides additional interest to be declared by the LIC on regular premium accounts for in force policies. It may be mentioned here that the complainant’s policy is a regular premium accounts. Had the Ops mentioned about the deductions to be made out of the deposits through their advertisements, the matter would have been different because the very advertisement came well before the proposal and issue of policy bond. In this case, the complainant has seen the advertisements first and being allured with the offer, the complainant has put his foot out for the proposal and thereafter the Ops placed their terms and conditions through policy bond before the complainant.
7. It is seen that the complainant has 3 Nos. of other LIC policies which also acquire death benefits and Ops must have aware about it. If the complainant knew from the Ops at the first instance that it is basically a death benefit policy, he would have thought twice to give a proposal for the disputed policy.
8. The copy of advertisements filed in this case is deemed to be a statement issued to the public by the Ops and the Ops are to act accordingly but did not do so. Materially those advertisements mislead the public. The Ops in this case, gave false and misleading facts expressing benefits attached to the policy offered for sale to the public. Further the Ops expressed, made and contained the statement through handouts, leaflets in this case and sold their policies through agents. Whatsoever made available to a member of public through advertisement must be strictly adhered to and carried out at the time of maturity. Therefore, it was ascertained that the advertisements issued by the Ops is altogether different than that of their conditions of the policy and by alluring the public through misleading advertisements, they have sold the policy. As such it is concluded that the Ops have issued misleading advertisement and thereby adopted the method of rack and ruin towards their customers which in our opinion amounts to unfair trade practice on the part of the Ops.
9. The complainant in this case has prayed for assured interest on the amount paid to the Ops with additional amount with 18% interest besides a compensation of Rs.50, 000/-. In the above circumstances, we are not inclined to recalculate the interest and differential amount under the policy as prayed for but we feel that the complainant must have suffered some mental agony for such unfairness activities of the Ops for which he is entitled for some compensation besides cost of this litigation. Considering the sufferings of the complainant we feel a sum of Rs.10, 000/- towards compensation and costs in favour of the complainant will meet the ends of justice.
10. Hence ordered that the complaint petition is allowed in part and the Ops being jointly and severally liable are directed to pay Rs.10, 000/- towards compensation and costs to the complainant within 30 days from the date of communication of this order.
(to dict.)
