IN THE CONSUMER DISPUTES REDRESSAL COMMISSION, ALAPPUZHA

Thursday the 28^th   day of  October, 2021.

                                      Filed on 08-09-2020

Present

1. Sri.S.Santhosh Kumar  BSc.,LL.B  (President )
2. Smt.  C.K.Lekhamma.B.A.L,LLB (Member)

In

CC/No.209/2020

between

Complainant:-                                                             Opposite parties:-

Smt. Revamma(Geetha)                                                  The Manager,

Kattunkalveli                                                                  Life Insurance Corporation

Aryad Panchayath                                                          of India, Branch Code-78PWard-13, Avalookkunnu.P.O                                                         Cherthala Branch,          

Alappuzha                                                                      Municipal Shopping Complex

(Party in peson)                                                              Cherthala-688524

                                                                                       (Adv. S.Devlal)

O R D E R

SRI. S.SANTHOSH KUMAR (PRESIDENT)

Complaint filed u/s 35 of the Consumer Protection Act, 2019.

 Complainant’s case in brief is as follows:-

  Complainant’s husband Sri. Krishnankutty had joined a Jeevan Anand Policy on 9/9/2004 and the sum assured was Rs. 5,00,000/-. He was remitting the premium correctly and had availed a loan as loan no. 7103 on the security of the policy.  While so on 23/9/2019 Sri. Krishnankutty died due to heart attack and the complainant  being the nominee is entitled to receive an amount of Rs. 15,00,000/-.  On 4/11/2019 complainant filed an application before the opposite party and on 8/11/2009 they paid an amount of Rs.1,14,200/-.  Contrary to policy conditions entire amount was not paid. On 28/11/2019 complainant sent a lawyers notice demanding Rs.15,00,000/-. However by mistake the amount was shown as 1,50,000/- instead of Rs.15,00,000/-.   After receiving the notice on 11/12/2019 opposite party deposited an amount of Rs.51,521/- in the account of the complainant.  Sri.Krishnankutty had remitted the premium for more than 15 years and so complainant is entitled to Rs.15,00,000/-.  Opposite party deducted an amount of Rs.7,93,856.61/- as default in insatlment and loan and paid Rs. 1,14,200/- on 8/11/2019.  Complainant is entitled to realize an amount of Rs. 6,00,000/- along with interest and also entitled to realize an amount of Rs.54,000/- along with interest for  which the complaint.

2.     Opposite party filed a version mainly contenting as follows:-

        The Jeevan Anand(Plan No.149) policy was issued to Krishnankutty which commenced on 9/9/2004.  The premium payment term of the policy was 16 years.  As per policy under plan 149 is that it provides for sum assured and accrued bonus at the end of the stipulated premium paying term on survival of the life assured.  In addition to the same, an additional amount equal  to the sum assured is payable on death of life assured  after premium paying term, provided policy was kept in force as on date of survival benefit payment ie,, premiums for premium paying term must be paid in full.  The policy is a combination of endowment and  deferred whole life assurance.

3.     In case of death during premium paying term, death claim will be settled for sum assured/ paid up value + vested bonus.  The terms and conditions of the policy contract  in this regard are clear, and the benefit payable on death before the end of the stipulated  premium payment term, is clearly mentioned  in the schedule of the policy document.

4.     The life assured expired on 23/09/2019, and the Gross Death Claim amount that would  have to be paid as per policy conditions is Rs.8,32,744/-, as follows:-

5.     The life assured had, on 10/8/2018, availed a gross loan of Rs.6,70,800/- on the policy and the said loan along with interest up  to the date of death is to be recovered from above amount of Rs.8,32,744/-.

 6.    Though the liability of the opposite party in full conformity with the policy conditions and declared bonus rates is as above, the Corporation has, by circular Ref: Actl/2009/4 dated.2/4/2005,  made a liberal provision for  settlement of Special Surrender value under Jeevan Anand Policy,  in case it is higher than the  Death Claim amount under the policy conditions.

7.     The calculation of the Special Surrender value is as follows:-

        Date of death                                          -       23/09/2019

        Date of commencement                         -       09/09/2004

        First un paid Qly instalment premium    -       09/06/2019 

Premuim paid for 14.75 years.

8.     The  Special Surrender value under the policy is the sum total of the Special surrender value for the endowment assurance component plus the special surrender value for deferred whole life component, as the plan is a combination of endowment and deferred whole life assurances.

9.     STEP 1- CALCULATION OF SPECIAL SURRENDER VALUE FOR ENDOWMENT ASSURANCE COMPONENT

10.   STEP 2 – CALCULATION OF SPECIAL SURRENDER VALUE FOR DEFERRED  WHOLE LIFE COMPONENT.

                        = PUSA x v ^n-d x SV factor

                        = 4,60,937 x v ^n-d x sv factor

n is the premium payment term and d is the duration(to the nearest half year)

n is 16 years and d is 15 years and as such, n-d =1, and consequently v factor is 1/1.08 – as per circular dated 2/4/2005.

Special Surrender Value                 = 4,60,937 x 1/1.08 x 0.3587

                                                        =   1,53,091/-

Total Special Surrender Value       =  Rs.7,55,046  +    1,53,091/-                                                        =   9,08,137/-

From the said total Special Surrender Value, loan and interest upto the date of death are to be recovered.

11.   The gross amount of Special Surrender Value for the policy as on the date of death worked out to Rs.9,08,137/- as above, which is more than the Gross death claim amount under the policy terms and conditions.  Consequently, a net amount of Rs.1,14,280/- ie, after deduction  of outstanding loan of Rs. 6,70,800/- along with loan interest of Rs.71,337/-, miscellaneous deductions to the tune of Rs.199/-, and unpaid instalments of premia with interest amounting to Rs.51,521/- was paid to the complainant on 8/11/2019.  However , when it was later found that the amount of Rs.51,521/- was not to be recovered there from, the same was refunded on  10/12/2019. Thus a net amount of Rs. 1,65,801/-(Rs. 1,14,280 + Rs.51,521/-) was paid to the complainant in full conformity with the rates and terms applicable.   After the death of the insured on 23/9/2019 the opposite party settled the claim within time as early as on 8/11/2019.  Thereafter the complainant issued a lawyers notice dated 28/11/2019 claiming that an amount of Rs.6,00,000/- still remains due towards the policy amount.  Prompt reply was given on 6/12/2019.   An amount of Rs.51,521/- was also paid  immediately when a bonafide mistake  was found out.    Complainant is not entitled for  getting any more amount and hence the complaint may be dismissed with compensatory cost.

12.   On the above pleadings following points were raised for consideration:-

    1.  Whether there is deficiency in service?

2.Whether the complainant is entitled to realize an amount of Rs.6,00,000/- along with  future interest as prayed for?

3. Whether the complainant  is entitled to realize an amount of Rs.54,000/- as prayed for?

4.Reliefs and costs.?

13.   Evidence in this case consists of the oral evidence of PW1 and Ext.A1 to A5 from the side of the complainant.  Ex B1 and B2 were marked  during her cross examination.    Opposite party has not adduced any oral evidence. Ext.B3 was marked.

14.     Point No. 1 to 3:-

PW1 is the complainant in this case. She filed an affidavit in tune with the complaint and marked Ext.A1 to A5.  During cross examination Ext.B1 and B2 were marked.

    PW1,  the complainant in this case is the widow of late Sri. Krishnankutty who had  a Jeevan Anand Policy  taken on 9/9/2004 from the opposite party M/s Life Insurance Corporation of India and the sum assured was Rs.5,00,000/-.  Krishnankutty was regularly remitting the premium and while so on  23/9/2019 he  died due to heart attack.  According to PW1 who is the nominee of  Krishnankutty she is entitled for  an amount of Rs.15,00,000/-.  On 4/11/2019  she filed an application before the opposite party and on 8/11/2019 she received  an amount of Rs. 1,14, 280/-.  However since the whole amount was not received on 28/11/2019 she sent a lawyers notice demanding the remaining amount and thereafter on 11/12/2019 Rs. 51,521/- was transferred to her account.  According to her as per the policy she is entitled for Rs. 6,00,000/-  and Rs. 54,000/- being the interest up to 28/11/2019.   Hence the total claim is Rs. 6,54,000/- along with future interest. Opposite party filed a version admitting the policy. The  policy commenced on 9/9/2004 and as per  plan No.149 the term of the policy was  16 years.   The assured expired on 23/9/2019 and as per the policy conditions the  death claim  amount  is Rs. 8,32,744/-.  On 10/8/2018  Krishnankutty had availed a gross loan of   Rs.6,70,800/- and it is to be deducted from the gross amount.  However the case was considered under Special Surrender Value and the total amount  payable to the nominee was Rs. 9,08,137/-. Out of the same the loan amount of Rs. 6,70,800/- was deducted and the remaining amount of Rs. 1,14,280/- was paid to PW1.   Later it was found that an amount of Rs. 51,521/- is also due to the complainant and it was paid.  Hence according to them no amount is due to the complainant and the complaint was filed on a wrong notion that she is entitled for Rs.15,00,000/-.  Complainant got examined as PW1 and Ext.A1 to A5 were marked.   Ext.B1 and B2 were marked  during  cross examination of PW1 and Ext.B3 was marked from the side of opposite party.

15.   The case advanced by PW1 is that as per the policy she is entitled for an amount of Rs.15,00,000/-.  But from Ext.B1  it is seen that the  sum assured is only Rs.5,00,000/-.  The policy commenced on 9/9/2004 and table and term was 149-16.  Admittedly Krishnankutty had  availed gross loan of Rs.6,70,800/- as on 10/8/2018.  So opposite party is entitled to recover the said amount  from the amount  due to the nominee.  In the version filed by the opposite party the entire calculation is given.  As per the 1^st step  the balance gross amount  is Rs. 8,32,744/- from the same opposite party is entitled to  deduct the loan amount.  As per Step 1   the surrender value is Rs. 7,55,046/- and as per step.2  the Surrender Value Rs.9,08,137/-. Since the calculation of Step.2 was beneficial to the nominee it was considered by the opposite party and after deducting the loan amount   of Rs. 6,70,800/- and the  loan interest is Rs. 71,337/- the balance amount is Rs. 1,14,280/- was paid to PW1.  But it was noticed that there was some mistake in calculation and additional amount of Rs. 51,521/- was also credited to the account of complainant ( total amount  is Rs. 1,65,801/-)

16.   When examined as Pw1 complainant stated that after the death of the husband she received more than Rs. 9,00,000/-, that is  including the loan amount. After deducting the loan amount she received an amount of Rs.1,14,280/- and later she received Rs. 51,521/-.  She also admitted that the claim was settled within 2 months after the death of her husband.  So from the evidence adduced from the opposite party it can be seen that the opposite party had settled the claim that also within 2 months from the date of  death  of the husband of PW1.  It appears that PW1 was under a wrong impression that she is entitled to get Rs. 15,00,000/-.  However she could not produce any documents to prove the same.  Admittedly from Ext.B1 policy it is seen that the sum assured is only Rs. 5,00,000/-.  Other than the sum assured as per the conditions of the policy the policy holder was entitled for bonus also.  The said total amount came more than Rs. 9,00,000/- from which opposite party had  recovered the loan along with interest and the remaining amount was paid to  PW1 who is the nominee.  Admittedly the amount was paid within 2 months from the date of  death of the assured and so there is no deficiency of service from the part of  opposite party.  Without any basis the complaint was filed on a wrong notion that she is entitled for Rs.15,00,000/-.  Since the opposite party had calculated the amount   more advantageous to the nominee and paid the entire amount, PW1 is not entitled to claim any more amount.  Hence the points are found against the complainant.

17.   Point No.4:-

        In the result complaint is dismissed. Parties are directed to bear their respective cost.

Dictated to the Confidential Assistant, transcribed by her corrected by me and pronounced in open Commission on this the 28^th    day of October, 2021.

Sd/-Sri.S.Santhosh Kumar (President)

Sd/-Smt.Sholy.P.R (Member)

Appendix:-Evidence of the complainant:-

PW1                    -        Revamma (Complainant)

Ext.A1                -        Letter dtd. 11/11/2019   

Ext.A2                -        Letter dtd.8/11/2019      

Ext.A3                -        Copy of Lawyers Notice dtd.28/11/2019

Ext.A4                -        Postal Receipt

Ext.A5                -        AD Card.     

Evidence of the opposite parties:-

Ext.B1                 -        Jeevan Anand Policy     

Ext.B2                 -        Copy of letter dtd. 6/12/2019   

Ext.B3                 -        Delegation of Powers  Regulation No.41 of LIC

///True Copy ///

To     

          Complainant/Oppo. party/S.F.

                                                                                                     By Order

                                                                                                Senior Superintendent

Typed by:- Br/-

Compared by:-