CONSUMER DISPUTES REDRESSAL FORUM
PALAKKAD, KERALA
Dated this the 23 rd day of November, 2012.
Present: Smt. Seena. H, President
: Smt. Preetha. G. Nair, Member
: Smt. Bhanumathi. A.K, Member Date of filing: 27/06/2012
CC .No/111/2012
K.V. Sujith,
S/o. K.R. Visambharan,
Residing at Daffodils, West Yakkara, - Complainant
Palakkad – 678 001
(By Adv.M. Rajesh)
Vs
The Branch Manager,
Bajaj Alianz Life Insurance Co. Ltd,
1st Floor, Surumi Plaza,
East Fort, Fort Maidan, - Opposite party
Palakkad – 678 001
O R D E R
BY SMT. BHANUMATHI. A.K, MEMBER
Complaint in brief :-
As per the promises given by the opposite party's sales executives, complainant has availed two policies one Unit Gain plus for Rs. 15,000/- per year on 23/09/2006 and one unit Linked plan for Rs. 20,000/- per year on 14/03/2007. The opposite party has issued policies vide No. 0026894022 and 0036820791 respectively. On going through the terms and conditions of the policy it is understood that it is against the offers which opposite party's sales executive has given. The complainant called the opposite party's office and expressed his unwillingness to continue with the policies. But the opposite party informed that amount will not be returned unless the complainant pays 3 years premium continuously. Then the complainant paid 3 years continuously Rs. 15,000/- and Rs. 20,000/- towards premium for the policies. In total the complainant has paid Rs . 105000/- to the opposite party.
After the completion of 3 years the complainant surrendered the policies. The opposite party has paid only Rs. 78,186/- ( RS. 33,606/- and 44,580/-). The complainant is entitled to the amount paid by him with interest and cost. The opposite party has deducted huge amount as surrendering penalty.
The act of opposite party amounts deficiency in service and caused mental agony and financial loss to the complainant.
So the complainant seeking an order directing the opposite party to pay the balance amount payable Rs. 26,814/- with interest @ 12% from the date of first premium (23/09/06) till realisation and Rs. 20,000/- as compensation for mental agony with cost to the complainant.
Opposite party entered appearance and filed version denying the contention put forward by the complainant.
It is true that the complainant has availed two policies from the opposite party. The complainant availed Bajaj Allianz New Unit Gain plus and Bajaj Alianz Capital unit gain insurance policy of the opposite party after understanding all the terms and conditions of the policies. Opposite party denies that the complainant was misrepresented by the executives of the opposite party. If the opposite party's executives have cheated the complainant by giving false information with regard to the policy as alleged he would never avail another policy from the opposite party within a period of 6 months.
After accepting the proposal for the insurance policy by the opposite party had been provided with the policy along with the terms and conditions of the policy in which it is clear that “ within 15 days from the date of receipt of the policy, you have the option to review the terms and conditions and return the policy”. After receiving the policy the complainant did not raise any complaint till 26/04/12. The complainant opted surrender the policy before its maturity which had resulted in deductions by way of surrender charge from fund value of the complainant. Opposite party is providing an insurance cover for the complainant's life till the period of surrendering the policy. The opposite party incurred various charges for providng the life cover to the complainant such as administration expenses and huge agent commission etc. Any discontinuance would result in surrendering charges, penalties apart from the normal charges like morality charges, administration charges etc.
For both policies he has given standing instructions to the company through clause 4 of the proposal form that the premium which would be paid by him be invested 95% in : Equity growth fund and 5% in liquid fund and hence investment in such equity related funds are subject to fluctuations of capital market and the entire risk in such invesment is to be borne by the policy holder. If the complainant had opted for liquid fund then the fund value may not gone low but since he agreed to bear risk as per the instructions the company had invested the investible premium of the complainant in equity growth fund. It is not correct to say that the complainant had not understood the terms and conditions.
There is no deficiency in service on the part of opposite party and complaint is liable to be dismissed with cost.
Both parties filed their respective affidavits and Ext. A1 to A6 marked on the side of the Complainant. Complainant is cross examined as PW1. No ducumentary evidence is adduced on the part of opposite party.
Issues to be considered are
Whether there is any deficiency of service on the part of opposite party ?
If so what is the relief and cost?
Issues 1 & II
The grievance of the complainant is that he had availed two policies ie, one Unit gain plus for Rs. 15,000/- per year on 23/09/06 and one Unit linked plan for Rs. 20,000/- per year on 14/03/07. On going through the terms and conditions of the policies, the complainant understood that it is against the offers which opposite party's sales executives were given to the complainant expressed his unwillingness to continue with the policies. The opposite party informed that the amount will not be returned unless the complainant pays 3 years premium continuously. The complainant paid 3 years – continuously Rs. 15,000/- and RS. 20,000/- towards premium for the policies. In total he has paid an amount of Rs. 105000/- . After the completion of 3 years the complainant surrendered the two policies. But the opposite party has paid only Rs. 78,186/-. These are evident from Ext.A3 and A4 document. According to the complainant he is entitled to get the balance amount Rs. 26,814/- with 12% interest from the date of payment of first premium till realisation along with cost and Rs. 20,000/- as compensation for mental agony.
It is the admitted fact the complainant has availed two policies and paid premium for each policies for 3 years continuously. The term of each policies are 10 year and 20 year respectively. It is evident from Ext. A1 and A2 document. But the compalinant surrendered the policies after the completion of 3 years. That is before the maturity period. The reason for surrendering the policies is stated by the complainant is that when he has gone through the terms and conditions of the policies it is quite different from which the offer given by the sales executives of the opposite party. At the time of cross examination the complainant admitted that he is an advocate. As a legal practitioner he will not be unaware about the 15 days of free lock period. Each policy contained a notice of Free lock where by the policy holder has the right to reconsider their decision to purchase the policy within 15 days of receipt of the policy documents in case does n't agree to the terms and conditions of the policy. Here the complainant didn't utilise the said opportunity. The complainant has taken the 1st policy on 23/09/06. If the complainant had a bitter experience by taking the policy defenetly he will be vigilent in taking such policies. But the complainant had take another policy within 6 months itself from the opposite party that is on 14/03/07.
Another contention of the complaint is regarding the deduction of huge amount by way of surrendering penalty. Both parties are not produced the terms and conditions of the policies. It is true that the complainant surrendered the two policies before attaining the maturity period. There is no document before the forum to show the criteria of the deduction of surrendering penalty. In the version the opposite party stated that the complainant has given instructions to the company through clause 4 of the proposed from that the premium which would be paid by him be invested 95% in : Equity growth fund and 5% in liquid fund, and investment in such equity related towards are subject to fluctuations of capital market and the entire risk in such investment is to be borne by the policy holder. Opposite party has not produced any document to show the details of investment. Opposite party contents that the company is acted as per the terms of IRDA. But no ducument is produced. As per clause 7 of IRDA Regulations 2010 the table annexed maximum discontinuance charges for the policies having annualized premium up to Rs. 25,000/- is maximum of Rs 1500/- . The annualized premium for both policies of the complainant is below Rs. 25,000/- . The complainant paid Rs. 105000/- towards the premium of two policies, from which the opposite party refunded an amount of Rs. 78,186/-. As per IRDA Regulations the opposite party can deduct an amount of Rs. 3,000/- only from the balance amount. So the opposite party is liable to refund an amount of 23,814/- (Rs. 26,814 - Rs.3000) to the complainant.
From the above discussions we are of the view that there is deficiency of service on the part of oposite party.
In the result complaint allowed. The opposite party is directed to pay an amount of Rs. 23,814/- (Rupees Twentythree thousand Eight hundred and Fourteen only) to the complainant along with Rs. 4,000/- (Rupees Four thousand only) as compensation for mental agony and Rs. 1,000/- (Rupees one thousand only) as cost of the proceedings.
Order shall be complied within one month from the date of receipt of order, failing which the complainant is entitled for 9% interest per annum for the whole amount from the date of order till realization.
Pronounced in the open court on this the 23 rd day of November, 2012.
Sd/-
Smt. Seena. H
President
Sd/-
Smt. Preetha.G.Nair
Member
Sd/-
Smt. Bhanumathi.A.K
Member
A P P E N D I X
Exhibits marked on the side of complainant
Ext. A1– Policy copy No. 0026894022 issued by opposite party dtd. 23/09/2006.
Ext.A2 – Policy copy No. 0036820791 issued by opposite party dtd. 14/03/2007.
Ext. A3 – Letter regarding surrender of Policy No. 0026894022 issued by opposite party dtd. 21/02/2012.
Ext.A4 – Letter regarding surrender of Policy No. 0036820791 issued by opposite party
dtd. 21/02/2012
Ext.A5 - Coy of Lawyer notice with postal receipt and acknowledgment card dtd. 26/04/12
Ext. A6- Reply notice sent by opposite party dtd. 16/05/12.
Exhibitsmarked on the side of opposite party
Nil
Witness examined on the side of complainant
PW1 - K.V. Sujith
Witness examined on the side of opposite party
Nil
Cost allowed
Rs. 1000/- ( Rupees One thousand only) allowed as cost of the proceedings.
