Raghavarapu Rama Devi,
W/o. late Venkata Subba Rao,
R/o. Near Ayyappaswamy Temple,
Guntur. … Complainant
ICICI Prudential Life Insurance,
Rep. by its Branch Manager,
15th line, Main Road, Arundelpet,
Guntur. … Opposite party
O R D E R
This complaint is filed under section 12 of Consumer Protection Act, 1986 by the complainant praying relief for sum assured to the tune of Rs.1,00,000/- and also for compensation and costs from the opposite party.
The case of the complainant is that
Her deceased husband by name Raghavarapu Venkata Subba Rao during his life time obtained policy bearing No.01520206 for a sum of Rs.1,00,000/- which commenced from 24-03-05 on payment of premium of Rs.20,000/-. This is the life time policy issued by the opposite party fixing yearly premium of Rs.20,000/-. Her husband died due to heart attack on 14-02-07. The complainant being the wife her name was noted as nominee of deceased. After death of her husband, she addressed a letter dt.18-04-07 vide Ex.A6 to the opposite party for settling the claim under policy vide Ex.A2. She has also submitted death certificate of her husband vide Ex.A5. But the opposite party did not give any reply nor settled the claim. The complainant requested the opposite party on number of occasions for early settlement of claim. But they failed to do so, as such it amounts to deficiency of service. Hence, the complaint.
The opposite party filed its version taking preliminary objections about the maintainability of complaint and also denied the allegations made in the complaint. According to the version, this complaint is filed in order to harass and gain undue advantage for unjustified amount on the lapse of policy as on the date of death of life assured. With regard to the facts of the case, it is submitted that the deceased was 52 years of age at the time of submitting his proposal for insurance, doing cool drink business and running STD shop. The proposal was submitted on 15-03-05 on his life under ICICI Life Time plan of insurance for sum of Rs.1,00,000/-. He had also opted for supplementary benefit namely Accident & Disability of a sum of Rs.1,00,000/-. The life assured had chosen yearly frequency for paying the premium of Rs.20,000/-.
He had nominated his wife, the complainant herein under section 39 of the Insurance Act. As per the age of life assured, the sum assured opted and the underwriting norms of the company, the life assured was required to undergo physical medical test and the same was completed by life assured on 23-03-05. Believing the information given by the life assured in the proposal form and believing the medical examination to be true and correct in all aspects, the proposal was accepted at standard (ordinary) rates of premium for basic cover and also for supplementary benefit of Rs.1,00,000/- and the policy was issued on 29-03-05 vide Ex.B1 and B2. As per the terms of policy, the premium of Rs.20,000/- is payable on 24th March every year.
The life assured is reported to have died on 14-02-07. After the death of life assured, the complainant lodged a claim with the opposite party on 18-04-07 vide Ex.B1 (Ex.A6).
It is further submitted that the premium payable on 24th March of every year to be paid either on due date or within the grace period but the same was not paid. Thus as per the terms and conditions of the policy the grace period would expire on 24th April of the relevant year, in present case i.e., 24-04-06. Therefore, no benefits become payable on death of life assured if the policy was in a lapsed condition. Since premiums under the policy were not even paid for three consecutive years, the policy lapsed without acquiring any paid-up value. The opposite party crave leave to draw the attention of the Forum on clause 4.1 (i) (payment of premium).
The opposite party informed the complainant vide its letter dt.28-04-07 vide Ex.B5 that the above said policy was in lapsed condition on 14-02-07 being the date of death of life assured. Further the premiums due on 24-03-06 and all subsequent premiums had remained unpaid. Therefore, as the policy is in lapsed condition on the date of death of life assured no benefits are payable there under. For the above said reasons, the policy benefits are not settled on the complainant. The complaint is devoid of merits. Hence, it is prayed to dismiss the complaint.
Both parties have filed their affidavits. Ex.A1 to A6 are marked on behalf of complainant. Ex.B1 to B5 are marked on behalf of opposite party.
Now the points for determination are that
1. Whether there is any deficiency of service on the part of opposite party in not settling the claim?
2. Whether the complainant is entitled for the sum assured under the policy vide Ex.A2?
3. To what relief?
The facts are no way in dispute. The opposite party admits about having insurance policy under ICICI Life Time plan of insurance for a sum of Rs.1,00,000/- to the deceased Venkata Subba Rao who had nominated his wife, the complainant herein as beneficiary there under. According to the opposite party, after completion of formalities they have accepted proposal and issued policy on 29-03-05. As per the terms and conditions of the policy premium of Rs.20,000/- is payable on or before 24th March every year within the grace period provided. According to opposite party except the initial premium amount at the time of issuing policy subsequently yearly premiums for the years 2006 and 2007 are not paid. Therefore, by the date of death of deceased on 14-02-07, policy was said to be in lapsed condition, as such no benefits will arrive out of the same and the complainant is not entitled for any amount as claimed.
In the aforesaid circumstances, the opposite party claims that absolutely there is no deficiency of service on their part. In this regard, they rely upon policy documents, which provides various terms and conditions of the policy vide Ex.B4, clause 4.1(i), which reads as follows:
Premium are payable on the due dates and at the rate mentioned in the policy certificate. However, a grace period of not more than 30 days, where the mode of payment of premium is other than monthly, and not more than 15 days in the case of monthly mode is allowed. If a premium is not paid during the days of grace, the policy shall lapse and no benefit shall be payable. If a premium is not paid during the days of grace after three full years’ premium have been paid and the policy has been in force for the full sum assured for those three policy years, the benefits payable under the policy shall be as indicated in clause 4.4. hereof”
The above provisions makes it clear that premium amount is not paid within the grace period of 30 days, the policy shall lapse and no benefits shall be payable. It also makes it clear that after making three full years premium and subsequent premiums are not paid within grace period, the benefits payable under the policy shall be as indicated in clause 4.4 thereon. But this situation does not arise in this case as deceased did not pay the premium of the year 2006 and 2007. Of course, he died one month before the premium is due in the year 2007. But ultimately two years premium remains unpaid.
As such, the policy lapsed and no benefits would accrue there under. The revival of policy as provided under general conditions does arise if the life assured is alive and on undertaking to pay premiums subject to other conditions provided there under. Thus we observe that absolutely there is no deficiency of service on the part of opposite party in repudiating the claim of complainant. They are justified in doing so as per the terms and conditions of the policy. The point is answered accordingly.
POINT 2 & 3
In view of the findings given in preceding point, the complainant is not entitled for any benefits under the policy. The complaint is devoid of merits. Hence, the complaint is dismissed. Each party shall bear their own costs.
In the result, the complaint is dismissed. Each party shall bear their own costs.