- This Revision Petition has been filed under Section 21 of the Consumer Protection Act, 1986 by the Petitioner – SBI Life Insurance Co. Ltd. (in short, the Opposite Party) against the Order dated 01.03.2016 passed by the Punjab State Consumer Disputes Redressal Commission, Chandigarh (in short, the ‘State Commission’) in First Appeal No. 1514/2014, whereby the Appeal filed by the Respondent – Vinod Kumar (in short, the Complainant) was allowed directing the Opposite Party to refund the amount of premium paid including bonus amount to the Complainant, setting aside the Order dated 08.09.2014 passed by the District Consumer Disputes Redressal Forum, Bathinda (in short, the “District Forum”) dismissing the Complaint.
- The brief facts of the case are that the Complainant, through an Agent of the Opposite Party, purchased two life Insurance Policies, out of which, for the first Policy dated 22.12.2011, premium of Rs.27,162/- was paid on 22.12.2011 and Rs.27,124/- through Cheque No.69334 was paid on 26.12.2012 and for the second Policy dated 05.01.2012, the premium of Rs.17,316/- was paid on 05.01.2012 and Rs.17,132/- through Cheque No.069335 was paid on 26.12.2012, thereby making the total payment of Rs.88,734/- for both Policies. It was alleged that at the time of purchasing the policy, the Agent of the Opposite Party assured the Complainant of hefty bonus amount on these Policies and that in case of surrender of the Policies, the entire deposited amount with bonus and other benefits will immediately be given to him, but he was never given the terms and conditions of the Policies. The Complainant was a resident of Bathinda, but the Policies were issued to him from Muktsar. It was alleged that when the Complainant approached the Opposite Parties for refund of his entire amount with bonus as promised by the Agent, he was informed that only in case of surrender he can get all his refund. Resultantly, he surrendered his Policies, but was not given any surrender receipt. Moreso, even the entire policy amount and bonus thereon was declined. Numerous times the Complainant contacted the Head Office of the Opposite Party to get his deposited amount and bonus back, but to no avail. Alleging that the Complainant was misled by false information about the Policy, which led him to purchase it and consequently, suffered a loss of his hard earned money, the Complainant filed a Consumer Complaint before the District Forum, seeking refund of the amount of Rs.88,734/- with interest @ 18% per annum from 22.12.2011 till payment alongwith Rs.1,00,000/- as compensation.
- The Opposite Party, in its reply, denied the allegations levelled against it. It was stated that as per the provision in the terms and conditions of the Policy approved by IRDA, after the expiry of free look cancellation period, the Policy cannot be cancelled and refund of the premium cannot be initiated to the Complainant. Furthermore, the Policy was issued based on the Proposal Form duly filled and signed by the Complainant, which is the basis of the contract between the insurer and insured. It was reiterated that the Complaint should be dismissed as barred by limitation and also the grounds in the Complaint are not legally valid, which are nothing but distortion of the facts and the law.
- The District Forum, vide its Order dated 08.09.2014, dismissed the Complaint.
- Aggrieved by the Order of the District Forum, the Complainant filed First Appeal before the State Commission.
- The State Commission, vide its Order dated 01.03.2016, allowed the Appeal and set aside the Order passed by the District Forum.
- Being aggrieved, the Opposite Party filed the instant Revision Petition.
- Heard learned counsel for the Petitioner. No body appeared for the Respondent.
- Learned Counsel for the Petitioner submitted that the Respondent/ Insured after paying two premiums for the two Policies sought refund. As per the Policy Provisions contained in Part-3 (Terms and Conditions) Clause-4, the Policy acquires paid-up value only if atleast three full Policy years’ Premiums have been paid. Further, for regular premium Policies, surrender value will be available after the completion of atleast three Policy years, from the date of commencement of the Policy provided all premiums then due have been paid. This is not a single premium Policy. Further, the Respondent/ Complainant failed to opt for cancellation of the Policy within the free look period and, therefore, his Petition may be allowed and the Order of the State Commission set aside.
- Perused the record and went through the terms and conditions of the Policy. The Respondent/ Complainant in his Complaint had mentioned that the Opposite Party had never sent the terms and conditions to the Insured/ Complainant. Further, when the Complainant asked for refund of the amount deposited by him towards the two premiums in the two Policies totalling Rs.88,734/-, he received no response. Notwithstanding the allegations, the Policy terms and conditions, which now form part of the record, are quite complicated and the words used like paid-up value, non-forfeiture benefits, revival, surrender value are technical in nature, which requires the Insured to have sufficient knowledge to understand the implications of the same. Further, it is not mentioned clearly in the terms and conditions that there shall be no refund for the premiums paid unless three premiums are paid in row. It is not clear what would be the situation if only two premiums are paid. This lack of clarity is important in this particular case, wherein, the Insured was not informed about the implications for not paying three premiums in order to avail the benefit of surrender, if at all. The Policy should have been clear enough to indicate that non-payment of three premiums would entail clear forfeiture of the entire amount paid thus far.
- It is also seen that when the Insured approached the Insurance Company for refunding the deposited amount, the Insurance Company did not make any reply to the Insured and more importantly, did not inform the Insured to pay one more instalment in each of the two Policies in order to avail the surrender value. There is no record to this effect of having informed the Insured. This, in my considered opinion, is a deficiency of service on the part of the Petitioner/ Insurance Company for which it is liable to refund the entire amount deposited towards the premium amount collected from the Respondent/ Complainant.
- In view of the aforesaid discussion, the Revision Petition is disposed of directing the Petitioner to refund the entire amount collected towards the premium in both cases to the Respondent along with an interest @ 7% per annum from the date of filing of the Complaint till realization within a period of eight weeks, failing which, the rate of interest shall stand enhanced to 9% per annum for the same period.
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