BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION, MYSORE-570023

CONSUMER COMPLAINT NO.241/2018

DATED ON THIS THE 3^rd MARCH 2023

Present:      1) Smt.A.K.Naveen Kumari

B.Sc., LL.M., - PRESIDENT  

                     2) Smt.Lalitha.M.K.,

M.A., B.A.L., LL.B., - MEMBER  

                        3) Sri Maruthi Vaddar,

                                                B.A., LLB (Special)  - MEMBER

Smt. A.K.Naveen Kumari,

PRESIDENT

  The complainant has filed complaint against the opposite parties for issue of directions to pay the entire policy amount of Rs.4,76,157/- covered under the policy with  interest at the rate of 24% p.a. from the date of death of the policy holder till the realization, to pay cost and compensation of Rs.50,000/- towards mental agony and such other appropriate reliefs as this Hon’ble Commission deems fit  in the circumstances of the case, in the interest of justice and equity.

2.     The complaint in brief avers as under:-

 That the 1^st opposite party is the Life Insurance Corporation working under the name and style as Max Life Insurance Company Ltd., Having Head Office as mentioned in the above sited address.  The 2^nd opposite party  is working at branch office in the same name and style as mentioned in the address cited above. It is contended that, the son of the complainant  namely  Mr.S.Manjunathaswamy taken a traditional participating endowment insurance plan through the agent of the 1^st and 2 opposite parties vide policy No.271477176 commencing on 09.04.2015 for the sum assured of Rs.4,76,157/- . The annual premium amount  is Rs.48,501.35 paid to 2^nd opposite party through his agent and  the complainant as his nominee. The policy was in force.

3. That, unfortunately the son of the complainant  S.Manjunathaswamy died on 14.07.2016, It is contended that after his demise the complainant has approached the 2^nd opposite party personally along with the required documents to settle the insurance claim. That, the son of the complainant  has obtained a policy in order to secure his life, but unfortunately he died. That the benefit of the policy has to go to the nominee i.e. the complainant who is the father of the policy holder.  That the opposite parties.1 and 2 have to pay the policy amount to the complainant as per the policy.  But, in order to avoid to pay the policy amount to the complainant, the opposite party Nos.1 and 2 by giving unwanted reasons so far have not paid the policy amount which amounts to deficiency in service.

4.   That left with no option, the complainant has issued notice to the opposite parties and the same is duly served upon them.  That the 2^nd opposite party has sent a letter along with death claim form on 28.11.2017 requesting to submit the required documents.  That the complainant has submitted all the original documents and bond to the 2^nd opposite party.  It is contended that,  after the submitting of the application along with the required documents, after one month  the opposite party has returned the original bond by giving unwanted reason in order to escape from paying the insured amount and has caused deficiency in service. Hence, this complaint.

 5.  After filing of the complaint notice was issued to the opposite parties. In response to the notice, the opposite parties 1 and 2 appeared through counsel and filed version.  But the 3^rd  opposite party  remained absent in spite of service of the notice. Hence  the  3^rd opposite party  placed exparte.

6.     The version filed by the 1 and the 2^nd opposite parties  avers as follows:

   It is contended that the complaint is false, malicious, incorrect and is nothing but an abuse of the process of the law and it is an attempt to waste the precious time of this Hon’ble Commission, as the same has been filed by the complainant just to avail undue advantage.  It is contended that the claim of the complainant was rightly repudiated by the opposite party on the ground that the policy was in the lapsed status, on the date of the death of the deceased life insured. That the renewal premium under the said policy was due on 9^th April of ever year, until 2022.  That the subsequent year renewal premium was due on 09.04.2016.  However, the insured failed to pay the renewal premium on the due date.  That the ECS transaction sent for clearance on 09.05.2016 was dishonoured for the reason that the account was closed/transferred. So, the opposite party informing about the same sent a letter to the insured on 10.05.2016.

7.   It is contended that since the insured failed to make the payment even within the grace period of 30 days,  so the policy lapsed.  That the opposite party received the death claim intimation on dated 24.03.2018 from the complainant  intimating the death of the insured on 14.07.2016.  It is contended that the opposite party duly evaluated the claim of the complainant and upon evaluation, it was observed that the policy was in the lapsed status as on 14.07.2016 i.e. on the date of the death of the insured, due to non-payment of renewal premium, which was due on 09.04.2016. That, since the policy was in the lapsed status on the date of the death of the insured, as per the terms of the policy contract and as per the principles of Insurance Law, the opposite party  has repudiated the claim of the complainant vide Repudiation letter dated 27.03.2018. The opposite parties have specifically denied that the policy was in force. Hence, prays for the dismissal of the  complaint with costs.

8.   The complainant has filed affidavit in lieu of evidence and produced documents.

   The Deputy Manager of the opposite parties 1 and 2 filed affidavit in lieu of evidence and produced documents.

9.     The learned counsel for the complainant and the opposite parties1 and 2 have filed  written arguments.

10.   Now the points that arise for the consideration of the    

        commission are:-

1. Whether the complainant has proved the deficiency in service by the opposite parties and so the complainant is entitled for compensation?

2. What order?

11.   Our findings on the aforesaid points are as follows:

Point No.1 :- In the negative

Point No.2 :- As per the final order for the following:

:: R E A S O N S ::

12. Point No.1:- The complainant has filed complaint against the opposite parties claiming the insured amount of Rs.4,76,157/- towards the life insurance policy of his deceased son namely S.Manjunathaswamy along with interest and compensation of Rs.50,000/-. As per the evidence of the complainant, his son has taken a Traditional participating endowment insurance plan through the agent of the 1^st and 2^nd opposite parties commencing from 09.04.2015 for a sum of Rs.4,76,157/-  The complainant has produced the key feature document i.e the original bond of Max life policy.  In this the date of commencement, maturity date and the annual premium amount is shown. The complainant has produced the copy of the proposer form.  As per the evidence of the complainant, his son had paid the annual premium amount of Rs.48,501.35 to the 2^nd opposite party through his agent and the policy was in force. As per the evidence of the complainant since he is the nominee in view of the death of his son he should get the benefit of the policy.

13.  The copy of the death claim form produced by the  complainant discloses that his son died on 14-07-2016.  As per the evidence of the complainant though he has submitted claim form the opposite parties.1 and 2 by giving unwanted reasons failed to pay the insured amount.  So, he has issued notice to the opposite party through advocate. The complainant has produced the copy of the notice for having issued notice to the opposite parties on 03-10-2017. As per the evidence of the complainant, the notice is duly served on the opposite parties.  In fact the OPs issued reply on 28-11-2017 the reason for having repudiated the claim. The evidence of the complainant discloses that the opposite party No.2 has returned the original bond one month after the submitting of the claim form by giving unwanted reason.  The complainant has not disclosed the reason for repudiating the claim or for having returned the original bond submitted by him along with claim form.

14.   The opposite parties.1 and 2 have admitted the issuance of life insurance policy as stated by the complainant.  But, as per the evidence of the Deputy Manager of the opposite parties 1 and 2, the renewal of premium under the said policy was due on 9^th April of every year and though the renewal premium was due on 09.04.2016, the insured failed to pay the renewal premium on the due date.  As per the evidence of the opposite parties 1 and 2, ECS transaction sent for clearance on 09.05.2016 and the same was dishonoured for the reason that the account was closed /transferred.  It is the evidence of the opposite parties is that since the insured failed to make the payment of the premium even within the grace period of 30 days, the policy lapsed and the said fact was duly informed to the insured through a letter dated 10.05.2016.  The opposite parties 1 and 2 have produced letter addressed to the insured. 

15. As per the evidence of the OPs, they received claim intimation on 24.03.2018 from the complainant intimating them about the death of the insured on 14.07.2016.  Since the policy was in the lapsed status as on 14.07.2016 i.e. on the date of the death of the insured due to non-payment of renewal premium which was due on 09.04.2016, the claim of the complainant was repudiated through a letter dated 27.03.2018.  With regard to the non-payment of renewal premium within a stipulated time the learned counsel for the opposite parties1 and 2 has relied upon the decision reported in:

              III (2005) CPJ 31 (SC) –

Life Insurance Corporation of India Vs. Mani Ram.

Where in it is held that payment of premium is to be made within the grace period of one month and if the premium is not paid within the grace period the policy would lapse for noncompliance and accordingly the Insurance company would be justified in rejecting the claim.

16.   When the opposite parties 1 and 2  have taken contention that they have repudiated the claim of the complainant since the premium was not paid within due date and also after the grace period, the complainant  ought to have produced  the document for having paid the premium to show that the policy was in force as on the date of death of his son.  The complainant failed to produce the receipt for having paid the premium. From which, it discloses that the opposite parties have rightly repudiated the claim of the complainant.  So, it can be said that there is no any deficiency in service by the opposite parties.  Hence, the complainant is not entitled for the relief sought.  Hence, we answer this point  in the negative.

17. Point No.2:- In view of answering point No.1 as above, we proceed to pass the following

:: ORDER ::

      The complaint is dismissed with cost of Rs.5,000/-.

      Furnish the copy of order to all the parties at free of cost.

(Dictated to the Stenographer transcribed, typed by her, corrected by us and then pronounced in open Commission on this the 3^rd MARCh 2023)