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Narinder Kaur & Others v/s Birla Sun life Insurance Company Limited & Another

    First Appeal No. 136 of 2013

    Decided On, 04 June 2015

    At, Punjab State Consumer Disputes Redressal Commission Chandigarh

    By, MEMBER

    For the Appellants: Mukand Gupta, Advocate. For the Respondents: Nitin Thatai, Advocate.

Judgment Text

J.S Klar, Presiding Judicial Member:

1. The appellants (the complainants in the complaint) have directed this appeal against the respondents of this appeal (the opposite parties in the complaint), challenging order dated 18.07.2012 of District Consumer Disputes Redressal Forum Patiala, dismissing the complaint of the complainant. The instant appeal has been preferred against the same by the complainants now appellants in this appeal.

2. The complainants have filed the complaint U/s 12 of the Consumer Protection Act, 1986 (in short, "the Act") against the OPs on the averments that the father of the complainants purchased two life insurance covers from office of OP No.2 out of his retrial benefits after his superannuation, as Chief Electrical Inspector. The two insurance covers are policy no.000469409, date of issue 20.09.2005 Classic Life Insurance Policy and policy No.001242580, date of issue 23.10.2007 Gold Plus Policy Scheme. The above referred two insurance policies were having insurance cover of policy holder/deceased of Rs.15 lac each. The above-referred two policies covers were purchased by Dalip Singh Uppal, the father of the complainants. The father of the complainants, who was insured, underwent an operation/surgery for removal of stones from his kidney, but due to some post operational complications and despite proper treatment, the deceased policy holder expired on 25.12.2008. The father of the complainants called the official of OP No.2 i.e. Mr. Sanjiv Sharma, Agency Manager in the presence of complainant before undergoing operation and informed him about his illness/surgery before his untimely death. The elder brother of the complainants informed the OPs on 29.12.2008 about the sudden death of insured. On receipt of the intimation, the concerned officials OPs namely Sh. Sanjiv Sharma came to the house of the complainants and met the complainants. He was having entire official record of both policies with him and he assured the complainants that since they were legal representative of Dalip Singh Uppal/policy holder and would be paid the amounts in full. The Chief Manager namely Sh. Girish Joshi , wrote a letter dated 11.02.2009 and sent it through Blue Dart Courier Service to the complainants. The necessary documents were submitted by the complainants, as desired by the OPs for the insurance claim. The OPs paid the claim in respect of one policy of Rs.15 lac to the complainants against policy no.000469409 of Classic Life Insurance Policy. The complainants were surprised to ascertain that genuine claim against second policy of Gold Plus Policy Scheme was rejected by the OPs arbitrarily and illegally on the ground that second policy bearing no.001242580 has lapsed on 25.11.2008, exactly one month before the date of death of the father of the complainants. The OPs refunded the amount approximately Rs.85,000/- to the complainants by stating that this was only due amount/fund value/surrender value, which was pending for payment to the complainants against this Gold Plus Policy Scheme. The OPs have illegally withheld the insurance claim of the complainant with regard to policy no. 001242580 dated 23.10.2007 of Gold Plus Policy Scheme. The complainants personally approached the office of OP No.2 at Patiala and clarified their stand that OPs have not given any reminder to the policy holder for not making the payment of the above policy against which the insurance claim was rejected by the OPs arbitrarily. The complainants received registered/speed post letter from office of OP No.1 that second policy has been rejected on the sole basis of the some rules and regulations quoted therein. This letter was written on 26 March 2009, but was posted in 1st April 2009. The complainants have, thus, filed the present complaint against the OPs directing them to pay the amount of Rs.15 lac with interest @12% p.a from the date, on which the said claim was filed with the OPs against the policy no. 001242580, and further to pay Rs.50,000/- as compensation for mental harassment of the complainants and Rs.20,000/- as costs of litigation, because the complainants are the legal representative of the policy holder Dalip Singh Uppal their father.

3. Upon notice, OP No.1 and 2 filed their written reply by raising preliminary objections that complaint is not maintainable and merits dismissal on that score. No cause of action has accrued to the complainants against the OPs in this case. The complainant has concocted the false story in this case. It is admitted fact by OPs that Dalip Singh Uppal purchased the above-referred two policies, as per the guidelines of the Insurance Regulatory Development Authority (IRDA), the authority regulating the affairs of opposite parties, deceased life assured was given detailed description about the features of the said plans including the premium amount to be paid, all the charges that would be levied on the same and was also informed with its terms and conditions before signing the documents. It was further averred that second premium amount of the policy no. 001242580 was due on 23.10.2007 and the second premium amount was not paid by the life assured on the due date. As per the policy terms and conditions on non-receipt of due policy premiums within the grace period, the policy no.001242580 stood lapsed with effect from 23.10.2008. On its lapsation, the deceased/life assured had option to revive the said policy by paying all the due/unpaid premium and providing evidence of insurability satisfactory to the OPs. The OPs, vide letter dated 02.01.2009, informed the life assured regarding lapse policy status under the policy no.001242580 and it was not revived after 23.10.2008 and on 12.02.2009. The OPs received death intimation from the complainants of the life assured about on 25.12.2008. The OPs have not admitted the claim for policy no.001242580 and intimated the complainants accordingly, vide letter dated 18.02.2008. It was admitted that life assured took the above referred two polices from the OPs. It was denied by OPs that the concerned official of the OPs made it sure to the complainants that the payment of the both policies shall be made to the concerned legal heirs of the deceased/policy holder within a period of 15 days. The OPs being insurer has no legal liability or statutory duty to remind the policyholder for payment of the renewal premium which was due. The OPs just to save the interest of its client under the said policy no.001242580, had issued lapsation notice dated 02.01.2009 to the life assured so that the said policy might be revived and the life assured could get the benefits of the said in case of any mis-happening. It was further averred that policy in question has three years of paying terms with annual premiums amounting to Rs.3,00,000/- per annum for the 8 years of benefit period. The OPs on the above-referred averments prayed for dismissal of the complaint of the complainant.

4. The complainant tendered in evidence, the affidavit of complainant Ex.C-12, copy of special power attorney Ex.C-1, copy of second policy Ex.C-2, copy of document proof of operation Ex.C-3, copy of death certificate of policy holder Ex.C-4, copy of details of cell phone Ex.C-5, copy of letter Ex.C-6, copy of Act Ex.C-7, copy of broucher of insurance company Ex.C-8, copy of written request Ex.C-9, copy of letter Ex.C-10, copy of receipt Ex.C-11, affidavit of Umrao Sher Singh Uppal Ex.C-13, copy of letter dated 21.3.2009 Ex.C-14, First Premium Receipt Ex.C-15, Life Insurance Gold Plus II Ex.C-16, account statement of Life Insurance Gold Plus II Ex.C-17, investment fund provisions Ex.C-18, policy document Ex.C-19, Medical Examiner's Reprot Ex.C-20, ECG Report of complainant Ex.C-21, document of Birla Sun Life Insurance Ex.C-22, document of Birla Sun Life Insurance Ex.C-23, copy of Administrative Guidelines Ex.C-24, copy of letter dated 21.09.2005 Ex.C-25, copy of letter dated 21.09.2005 Ex.C-26, document regarding details of class life policy Ex.C-27, First Premium Receipt Ex.C-28, copy of policy details Ex.C-29, copy of general provisions Ex.C-30, copy of policy document Ex.C-31, document of Income Tax Department Ex.C-32, copy of document dated 18.02.2009 Ex.C-33, copy of Cash Manager Service payments Ex.C-34, copy of document dated 18.2.2009 Ex.C-35, copy of document dated 18.2.2009 Ex.C-36, copy of document dated 18.2.2009 Ex.C-37. As against it, OPs tendered in evidence the affidavit of Sreemaya Athikkat Authorized Representative of Birla Sunlife Insurance Company Ex.R-1, copy of policy document Ex.R-2, copy of policy document Ex.R-2/A, copy of lapsation notice Ex.R-3, copy of letter dated 18.2.2009 Ex.R-4, copy of document dated 18.2.2009 Ex.R-5, copy of document dated 18.2.2009 Ex.R-6. On conclusion of evidence and arguments, the District Consumer Disputes Redressal Forum Patiala, dismissed the complaint of the complainant by virtue of order dated 18.07.2012. Dissatisfied with the order of the District Forum Patiala Patiala dated 18.07.2012, the complainants now appellants have preferred this appeal against the same.

5. We have heard learned counsel for the parties and have also examined the record of the case. The stand of the OPs is that premium, which was due on 23.10.2008, had not been paid by the policy holder Dalip Singh Uppal on due date. It was further argued that as per terms and conditions of the policy under the head Premium Discontinuance, if the assured is unable to pay policy premium by the due date, he would be given a grace period of 30 days during which period, all cover ages under the policy would continue. In case, premium of the policy was not received even in the grace period, then policy would deemed to have been lapsed and coverage would cease forthwith. The lapse date would be the date of unpaid premium, which was due and assured have two years from the lapse date to revive it. All premiums payable/due payable, which were previously unpaid have to be paid with evidence of insurability to the satisfaction of the OPs. The District Forum further observed that the complainant had not made any effort to get the policy revived and OPs had not to terminate the policy and to pay the surrender value thereof. The OPs paid the surrender value of Rs.88445.84, vide cheque no.850044 dated 18.02.2009 to the complainant. The counsel for appellants could not cite any provision of law to the effect that it was mandatory on the part of the OPs to issue reminder/notice of the premium due to the insured. The policy would run strictly according to the terms and conditions of the policy. The policy stood lapsed on account of non-payment of the premium due on 23.10.2008 and it was not got deposited even within grace period of 30 days. The policy was, thus, in lapsed condition, which is in dispute in this case at the time of death of the life assured. We are in agreement with the view of the District Forum on the above referred point.

6. Even on the next count, we find that instant policy was Gold Premium Policy Scheme, which is Ex.C-2 on the record. It is recorded in it that this is Unit Linked Life Insurance Policy. The actual payment of the benefits in this policy will vary based on the actual performance of the investment funds invested by the assured. From perusal of terms and conditions of the policy Ex.C-2, we hold that it is Unit Linked Policy, which was taken by the life assured/Dalip Singh from the OPs. On this matter, the Hon'ble National Commission has held in "Ram Lal Aggarwalla Vs. Bajaj Allianz Life Insurance Company Ltd., Bajaj Allianz Insurance Company Limited and UT Bank Ltd." reported in III(2013) CPJ-203 (NC) and observed as under :

"The investment made by the petitioner/complainant was to gain profit. Hence, it was invested for commercial purposes and, therefore, the petitioner/complainant is not a consumer under the opposite parties. The State Commission Odisha in First Appeal No.162 of 2010 in the case of Smt. Abanti Kumari Sahoo Vs. Bajaj Allianz Life Insurance Company Ltd., have held that the money of the petitioner/complainant invested in the share market is no doubt a speculative gain and the speculative investment matter does not come under the Consumer Protection Act and accordingly, the State Commission dismissed the appeal.

It is evident that in the above-referred authority, it has been held that in the matter of Unit Linked Policy, the complainant invested the money just to gain profit and made its investment for commercial purposes

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and assured is not a consumer under the above policy. Our State Commission has also so held in Consumer Complaint No.96 of 2011, Date of Institution : 29.11.2011, Date of Decision : 04.07.2014 titled as "Smt Paramjit Kaur Vs. Aviva Life Insurance Company India Ltd," by observing that it becomes very much clear from the Hon'ble National Commission in "Ram Lal Aggarwalla" (supra) case that in respect of claim under Unit Linked Insurance Policy, the consumer complaint is not maintainable under Act because the money having been invested in a speculative business. We are bound by the law laid down by the Hon'ble National Commission in the above-referred authority, which is applicable to this case. The complainants, thus, do not become the Consumer of the OPs with regard to this Unit Linked Policy as held in the above-referred authority. 7. In the light of our above discussion, we find no illegality in the order of the District Forum, calling for any interference therein. The order of the District Forum Patiala dated 18.07.2012 is affirmed in this appeal. Finding no merit in the appeal, the same is hereby dismissed. 8. Arguments in this appeal were heard on 29.05.2015 and the order was reserved. Now the order be communicated to the parties. 9. The appeal could not be decided within the statutory period due to heavy pendency of court cases.