Orissa

Rayagada

CC/15/38

Sri Balaram Bidika, S/o: Sukru Bidika, - Complainant(s)

Versus

The Branch Manager, Reliance Life Insurance Ltd., - Opp.Party(s)

Self

30 Apr 2016

ORDER

DISTRICT   CONSUMER  DISPUTES REDRESSAL    FORUM, RAYAGAD

  C.C. Case  No.38/ 2015

P R E S E N T .

Sri Pradeep Kumar Dash, LL.B,                             President.

Smt. Ch.  Nirmala Kumari Raju, LLB,                    Member

Bolaram Bidika, S/o Sukuru Bidika,Kondajam Panchayat, Parkhit, Block/Ps Ramanaguda, Dist. Rayagada.                                                                                                           …….Complainant

                                                            Vrs.

1.         The Branch  Manager, Reliance Life Insurance Company , Rayagada.

2.         Reliance Life Insurance Co.Ltd., Level 1,Midas Wing-A,Sahar Plaza, Andheri Kurla            Road, Andheri East,Mumbai-400059(India).                         …..…..Opp.Parties

Counsel for the parties:

For the complainant: In Person

For the O.Ps: Sri Ram Prasad Patra  & Associates Advocate, Rayagada.

                                                                                   JUDGMENT

                 The case of the complainant  is that  complainant has  deposited one time premium of Rs.30,000/-   with the O.ps  but when the policy bond was received it is noticed that  every year the complainant has to pay a premium of Rs.30,000/- for ten years but this fact was not disclosed to the complainant. The complainant is a daily labourer and the O.ps know the fact that he is not able to pay the premium proposed by them . The complainant approached the O.p 1 to know the status of the policy  and the O.p  kept the policy bond and premium receipt  and paid a sum of Rs.19,000/- only against payment of Rs.30,000/- . The complainant only wanted to get insurance coverage , it is stated by the O.p 1  and his staff that after  three payment and after five years of commencement of the policy he can withdraw the money and policy will continue. The complainant being a daily labourer  is not able to pay the heavy premium and hence prayed to refund the balance amount of Rs.11,000/- with interest  and  compensation for mental agony and cost of the litigation.  Hence, this complaint.

                  The O.Ps appeared through their learned counsel and  file counter inter alia denying the petition allegations on all its material particulars. It is submitted by the O.ps that  the present complainant is not a consumer within the meaning and definition of consumer as defined in the Consumer Protection Act. The policy in question is a Market Linked Policy and law is now well settled that such policies are  speculative  in nature e and the same are taken for investment purpose and as such the policy holder of such policies are not consumers and disputes relating to such policies are not sustainable before the Consumer Forum. The complainant voluntarily applied for the policies for the purpose of investment and insurance after fully knowing well about the terms and conditions of the policy.  The complainant opted for Super Invest Assure Plan bearing Policy No.17213614 and the premium amount is Rs.30,000/- ,policy term 10 years and with risk commencing from 21.06.2010. The complainant after completely understanding  the terms and conditions of aforesaid policy offered a  initial premium towards the premium  under the said plan. The contents of the proposal form were explained to the complainant  and the complainant has given a declaration stating that the contents of the application was read over and explained to  him and he has  furnished the information after fully understating  the contents thereof  and after understanding the terms and conditions of the plan. Upon receipt of the duly filled up proposal forms along with the initial annual premium, the Opposite Party evaluated the proposal form on the basis of the information provided by the complainant, processed the proposal form of the complainant and issued the aforesaid insurance policies and there after the policy documents were dispatched to the complainant which was received by the complainant. It is  also suibmktted that  the welcome letter clearly stated that in case the complainant disagreed with the  terms and conditions of the policy, he should return the policy within 15 days of the receipt of the same and  was entitled for cancellation available to the complainant. The instant complaint lacks a cause of action  as the policy had been force closed  for non payment of premium and the complainant  by filing up the surrender payout form had willfully and voluntarily opted to surrender the policy and has accepted the surrender amount without any protest . The policy was force closed on 21.06.2013  and an amount of Rs.19036.84 was paid to the complainant vide HDFC NEFT Ref  No.140524657002 dt.24.05.2014 .Therefore this complaint is liable to be dismissed on want of the cause of action.

                                                FINDINGS

            It is the cardinal principle of insurance law that the insurer is in the position of a trustee as it is managing the common fund for and on behalf of the community of policy holders. It has to ensure that nobody is allowed to take undue advantage of the arrangement. That means the management of the insurance business requires care to prevent entry(into group) of people  whose risks are not of the same kind as well as paying claims on losses that are not accidental. The Management of life insurance companies are required to keep this aspect in mind and make all its decisions in  ways that benefit  the community. This applies also to its investments.  That is why successful insurance companies would not be found investing in speculative ventures. The life insurance policy is a contract, in terms of the Indian Contract Act.  A contract is an agreement between two or more parties to do, or not do, so as to create a legally binding relationship. Here in this case the complainant was asked to pay one time premium of Rs.30,000/-  for three years by the agent explaining the benefits contained therein and the entire proposal form was written by the agent in his own hand writing and asked the proposer/complainant to sign on the dotted lines.  The declaration form filled in this case also written by the agent and obtained the signature thereon.  The agent’s responsibility is clearly explained in the IRDA instructions and also U/s 182 and 212 of the Contract Act. Here the agent has failed to discharge the duty as an agent and in order to get his income as commission has falsely represented the rural folks to divert their money. Hence the O.p has clearly violated the norms issued by the IRDA from time to time and as such the O.P is liable to pay the amount paid as premium to the complainant in this case the surrender value far below  their amount deposited with the O.p.  The investment is made by the O.ps for the profit and not by the insurer.  Hence the advise given by the agent and  obtaining a form wherein the risk factor is transferred  in favour of the insurer’s is definitely coming under the purview of unfair trade practice.

When a rural folk invest the money with the assurance of the agent in the insurance and when he came to know that the above investment is not yielding any profit even after years and as such the above investment brought by the agent and accepted by the O.P is not with any intention to give any economic protection but with an intention to grab the money of the rural folks. Hence the plea of the O.ps can not be accepted.

In view of the discussion above, it is found to be  an unfair trade  practice made by the agent and O.Ps.  The O.Ps  have introduced the agent to do the unfair deal with the rural folk as seen from the counter and as such the complainant is entitled to get  refund of the entire amount deposited by the complainant in the said scheme so as to enable them to invest the same with their choice.

We have gone through the complaint petition and documents available in the record. This forum by relying upon a citation passed by National Commission, New Delhi in the New India Assurance Co. Ltd., Versus M/s Sukhadham India Pvt. Ltd.,2011(1) CPR 191 such as :- “ Insurance Company must settle claim without delay”. In the light of the above decision of law we allow the case.

Hence it is ordered.

                                                                             ORDER

                        In the result the complaint petition is allowed on contest. We ordered  the O.ps to refund the balance amount with interest @ 6% per annum   and pay   compensation of Rs.2,000/-  for mental agony and harassment

                        The O.Ps are directed to make the aforesaid payment within 30 days from the date of receipt of this order failing which the complainant is at liberty to take further proceeding U/s 25 and 27 of the C.P.Act.

            Pronounced in open forum today on this 6^th of April,2016 under the seal and signature of this forum.

                         A copy of this order as per the statutory requirements , be forwarded to the parties    free of charge.

 

Member                                                                                               President

Documents relied upon:

 

By the complainant:

1.      Copy of Policy schedule.

By the O.Ps. Nil

 

 

                                                                                                 President