Date of filing : 06-03-2012
Date of order : 26-05-2014
IN THE CONSUMER DISPUTES REDRESSAL FORUM, KASARAGOD
CC.58/2012
Dated this, the 26th day of May 2014
PRESENT:
SMT.P.RAMADEVI : PRESIDENT
SMT.K.G.BEENA : MEMBER
SMT.SHIBA.M.SAMUEL : MEMBER
Sunny.V.P. S/o.Philip : Complainant
Vellakkada Veedu, Malakallu.Po,
Kasaragod.Dt.
(Adv.M.V.Bhaskaran, Hosdurg)
Manager, : Opposite party
Bajaj Allianz Insurance Company Ltd,
Bengacherri Building, Kanhangad.Po.
(Adv.K.V.Jayaraj, Kanhangad)
O R D E R
SMT.K.G.BEENA, MEMBER
The grievance of the complainant is that he had joined in opposite party’s insurance scheme and paid Rs.20,000/- in each year from 2007 to 2009. He deposited the amount on the basis of the assurance of agent that she will get 20% growth to the deposited amount and can surrender the policy after completion of 3 years. On 04-02-2012 the complainant given an application to surrender the policy. To his utter shock, the opposite party charged surrender penalty, which was not informed to him at the time of joining of the policy. The complainant is seeking a relief directing the opposite party to refund the deposited amount of Rs.60,000/- with 4 years interest and Rs.5000/- as compensation.
2. Adv.K.V. Jayaraj filed vakalath and version for opposite party. According to opposite party, this dispute does not fall under the purview of C.P.Act. Another contention raised by opposite party is that, the insurance consultant against whom allegations were made was not made party to the complaint. Hence the complaint needs to be dismissed for non-joinder of necessary parties. According to opposite party as per the standing instruction provided by the complainant in clause 5 of the proposal form, the entire investible premium to be allocated to “Asset Allocation Fund” is 100% and hence the entire amount is exposed to equity markets. “Asset Allocation Fund” details have been clearly explained in clause 31 (1) of policy terms. The performance of fund is directly related to the equity market and hence such investment risk has to be borne by the proposer which was agreed by the complainant at the time of executing the proposal forms, and after knowing the intricacies of the fund the complainant had close to allocate his entire investible premium in such fund.
3. Complainant examined as PW1. Exts A1 & A2 marked. Complainant faced cross examination by the counsel of opposite party. Opposite party filed proof affidavit and examined as DW1 was cross examined by the counsel of complainant. Both sides heard and documents perused. The issues raised for consideration are:-
1 Whether the complaint is non-joinder of necessary parties?
2 Whether there is deficiency in service on the part of opposite party?
3 If so what is the relief?
4. Issue No1: The learned counsel for opposite party Sri.K.V.Jayaraj submitted that the complaint is bad for non-joinder of necessary party as the agent who canvassed the complainant is not made party to the complaint. He further submitted that incase of fraud or inducement by the agent then the agent alone is liable and the insurer have absolutely no liability. To substantiate his contention he produced a proforma of agency license docket and invited our attention to condition No.11.
Condition No.11. No Employer-Employee relation
There shall be no employer-employee relationship between the parties herein and you shall not be entitled to any payments whatsoever other than commission for the proposals secured for the company.
But we are not inclined to accept the above contention. The above condition only indicates that the agent is not entitled for any service benefits from the company since he is not an employee of the company. The Master Agent relationship is something different than the employer and employee relationship. When an agent canvasses a business for the company, he step in to the shoe of the company and whatever acts or deeds he done in that capacity is a kin to that is done by the company itself. Therefore the agent is not necessarily be a party when the master company itself is the party array.
5. Issue No.2&4:- PW1 deposed that he availed the policy through one Saji, the agent who made his believe that he will get interest for the deposited amount. He received a policy document by post he never bothered to understand the contentions of the document what is stated by the agent he don’t know what is contained in the policy document. The agent told that the policy contains insurance coverage and the policy is a unit linked one which is subject to market risk. The agent described only the advantages of the policy, and never intimated the disadvantages, as it may refrain the consumer from purchasing the policy. If the consumers are attracted by the description of agents, they will purchase policy and thereby the agents will get attractive commission unemployment constrains the educated youth to join as agents in such multi national companies. After the entry of private insurance companies in the insurance sector they are doing aggressive business earlier it was service oriented. But now a days it is purely business motivated as they are well bend upon selling what they call ‘products’. As part of their aggressive business drive they offer ‘bonanza’ gala galore to their agents and who in turn grab the prospective policy holders by their throat by making tall promises in most cases insurance policies contain numerous terms and conditions that normally are not disclosed to the insured. No insurance agent would explain terms and conditions those appears be adverse to the interest of the policy holder. The agent of the insurance company terms act to be a most vital factor it is he who undertakes the insurance business on behalf of the insurer. He should make it a point to explain each and every condition or clause of the policy to the prospective policy holders which is printed in ‘small print’ of which ordinary person would not be in a position to read between the lines. Most of the policy holders rely blindly on the assurance of the insurance consultant and in most cases even the literate people will not spare time to read the full text of the policy.
6. From the evidence let in by the parties and also considering the facts and circumstances of the case we are of the opinion that at the time of canvassing the complainant what is transpired between the agent and the complainant as narrated by the complainant is true. Therefore the act of opposite party amounts to deficiency in service.
7. As per Ext.A2 sent by opposite party, the amount payable to the complainant by opposite party after surrendering the policy is only Rs.53,935.05 instead of 60,000/- with interest is expected by the complainant. But he received a cheque for Rs.53,363/- shows the deficiency in service and unfair trade practice followed by opposite party. Eventhough opposite party sent a cheque for Rs.53,363/- . Complainant did not accepted the money. Opposite party cannot absolve themselves from their liability to pay compensation for deficiency in service rendered through their agent and staff to the complainant. The case of the complainant is that the agent offered 20% growth to the deposited amount. Complainant joined the policy on 02-12-2007. He deposited Rs.20,000/- from 2007 to 2009. After the completion of 3 years the amount will be Rs.60,000/- plus 20% growth i.e. Rs.60,000+12000 = Rs.72,000/- In Sicely Thomas V ICICI Prudential Life Insurance Co.Ltd 1(2013) CPJ 94 (Kerala) it is held that the principal is liable for the act of the agent and the respondent is liable to compensate the appellant. Here the complainant is entitled for 12% interest for Rs.72,000/- with compensation of Rs.5000/-and cost of Rs.3000/-.
In the result, complaint is allowed and opposite party is directed to refund Rs.72,000/- with interest @ 12% from the date of surrender of policy till payment with a compensation of Rs.5000/- and cost of Rs.3000/-. Time for compliance is 30 days from the date of receipt of copy of the order.
Sd/- Sd/- Sd/-
MEMBER MEMBER PRESIDENT
Exts.
A1. Payment reference.
A2.04-02-2012 letter issued by OP to complainant.
B1. Proposal form for life insurance
PW1. Sunny.V.P.
DW1.Sandeep Prabhakaran
Sd/- Sd/- Sd/-
MEMBER MEMBER PRESIDENT
Pj/ Forwarded by Order
SENIOR SUPERINTENDENT
