Date of Filing: 14.09.2016
Date of Order:10.07.2019
BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM – I, HYDERABAD
P r e s e n t
HON’BLE Sri P.VIJENDER, B.Sc. L.L.B. PRESIDENT.
HON’BLE Smt. D.NIRMALA, B.Com., L.L.B., MEMBER
ON THIS THE WEDNESDAY THE 10th DAY OF JULY, 2019
C.C.No.436/2016
Between
Mr.Peram Venkatesh,
S/o.Sri P.Vemaiah,
Aged 50 years, Occ: RTC Driver,
Plot No.24, Sai Ramd Nagar Colony,
Near Ranga Sai Super Market,
Karmanghat, Hyderabad – 500 079. ……Complainant
And
- Kotak Mahindra Old Mutual Life Insurance Limited,
Rep. by its Authorized Signatory, Kotak Infiniti,
5th Floor, Zone – 2, Building No.21, Infinity Park,
Opp: Western Express Highway,
Gen.A.K. Vaidya Marg, Malad (E),
Mumbai – 400 097.
- Kotak Mahindra Old Mutual Life Insurance Limited,
Rep. by its Branch Manager, 3rd Floor,
Universal Bakers Building, Opp: TTD Kalyana Mandapam,
Himayathnagar, Hyderabad – 500 029.
- Sri Santosh Kumar, S/o.Not known to complainant,
Aged Major, Occ: Direct Agent,
Kotak Mahindra Old Mutual Life Insurance Limited,
Rep. by its Branch Manager, 3rd Floor,
Universal Bakers Building, Opp: TTD Kalyana Mandapam,
Himayathnagar, Hyderabad – 500 029
Mobile No. 9177332280 .….Opposite Parties
Counsel for the complainants : Mr.G.L.Prasada Rao
Counsel for the Opposite Party : Mr. Suri Sravan Kumar
O R D E R
(By Sri. P. Vijender, B.Sc., LL.B., President on behalf of the bench)
1) This complaint has been preferred under Section 12 of Consumer
Protection . Act, 1986 alleging that refuse to receive the arrears of premium payable or refunding the amount paid amounts to deficiency of service and unfair trade practice. Hence a direction to opposite parties to refund the amount of Rs.60,511/- with interest at 24%p.a. from 6.5.2013 to the date of payment and further direction to pay Rs.15,000/- as compensation and Rs.10,000/- towards mental agony and Rs.10,000/- towards costs of this complaint.
The complaint averments in brief are that :
2) The complainant is working as a driver in APSRTC , opposite party No.3 as an agent of opposite party No.1 and 2 approached the complainant and explained various policies being issued by opposite party No.1 and 2 and advised to take a suitable policy. The complainant having impressed with the presentation made by the opposite party No.3 booked Kotak Money Back policy bearing No.02296889 for a term of 20 years and half yearly premium payable was Rs.11,990/- and paid first premium by way of cheque . Opposite parties 1 and 2 issued the policy document and he collected it from post. Thereafter he paid 4 more half yearly premiums without any default.
While the matters stood thus in the month of March 2014 the complainant fell sick with Kidney ailment and was under treatment for a period of 6 months and later got admitted in Apollo hospital, Jubilee Hills, on 5.12.2014 for surgery. After surgery he was under treatment in post operation treatment till June, 2015. During this period he could not pay premium amount payable and could not maintain sufficient balance in his bank account. Non-payment of premium amount in time is neither willful nor wanton but on account of his ill health . After recover of health condition when the complainant approached opposite party No.3 to receive the premium was advised by the opposite party No.3 to submit an application to opposite party No.2 with a request to receive arrears of premium and revive the policy. Accordingly complainant submitted a written representation along with medical record to opposite party No.2 with a request to receive arrears of premium and revive the policy. But opposite party No.2 refused to receive the arrears and revive the policy and asked him to approach opposite party No.1 since policy was lapsed on account of non-payment of premium in time.
The complainant tried to contact opposite party No.1 by phone but there was no proper response. Again he approached opposite party No.2 but there was no use. The opposite party No.2 was not prepared to consider the medical records and the reasons given for not paying the premium in time. Having vexed with the response of the opposite party No.1 asked to refund payments made as premium till then. But they refused. He was informed by opposite party No.2 that all the premiums paid by him were adjusted to charges and nothing remains to refund. Hence the present complaint for the above stated reliefs.
3) A common written version has been filed by the opposite parties admitting issuance of the policy to the complainant and receipt of the 5 premiums but denied rest of the complainant’s version. The defense set out in the written version is that the complainant filled and signed the proposal form and submitted it along with the requisite documents for issuance of Insurance Policy known as money back on 13-4-2011. Based that said proposal form declaration made therein and instruction of the complainant the policy bearing No.02296889 was issued on 5.5.2011. The premium amount playable half yearly at Rs.12.177/- for a period of 20 years. As per the Clause 4(1) and 6(2) of the IRDA Regulations, 2002 sent to the complainant along with proposal forms the complainant had an opportunity to revive cancelled policy within free-look period of 15 days from the date of receipt of the policy document. The complainant received the policy document on 9.5.2011 and he has not exercised free-look provision. The insurance policy is a contract entered into by the policy holder with the company and thereby the parties are bound by its terms and conditions .
After issuance of policy the complainant has made 5 half yearly premiums till 5th November, 2013. Thereafter, he failed to pay premium despite intimation sent to him. A renewal premium notice dt. 16th October, 2013 was sent to the complainant reminding him to pay the renewal premium payable on 5.11.2013 but there was no response.
As per the Clause 2 payment of premiums:
An annual premium is payable in advance on the anniversary of the date of the commencement of the policy. A grace period of 30 days from the due date of payment will be allowed for payment of premiums. If the premium is not paid on or before the expiry of the grace period in the first three years from the date of commencement, the policy will automatically lapse.
However the policy holder can revive the lapsed policy with or without rider benefits added to the basic policy by submitting an application within the period of two years from the due date of first unpaid premium and before the date of maturity of the policy.
The complainant was reminded to pay premium due through various correspondences such as laps notice dt.5.11.2013 foreclosure Intimation letter dt.5.9.2015 and termination letter dt.5.11.2015. The complainant did not respond. Hence the policy was lapsed for non-payment of premiums and the policy was foreclosed and terminated without refund of surrender proceedings and same was communicated to him by termination letter dt, 5.11.2015. Thus the complainant by his own negligence failed to pay premiums due and allowed the policy to lapse. In order to avail refund of the premiums complainant has made concocted stories. The terms and conditions of the policy did not permit to refund the premiums paid on the lapse policies. Had the complainant paid at least first 3 years premium the subject policy would have accrued surrender value but since the complainant paid only for 2 ½ years amount cannot be refunded. Non payment of premium amount due non accrual of surrender value as per the Clause 13 of the Forfeiter policy the premium could not be refunded and forfeited premiums paid by the complainant .
The Hon’ble National Consumer Disputes Redressal Commission in the case of Life Insurance Corporation of India Vs.Siba Prasad Dash reported in IV, 2008 CPJ 156 (N) observed that
“ The premium is given by an insured, to cover the risk for a given period, and the insurer covers the risk for the period for which the premium has been paid. It is not the case of the complainant that the risk was not covered for the period for which the premium was given. If after the policy lapsed, under no provision of terms of p0olicy or law could any For a direct for refund of any premium for the simple reason, as already stated , that the risk stood covered for the period for which premium had been paid.”
There are catena of judgments that an Insurance Policy is to be construed strictly as per the terms and conditions of the policy documents and no deviation from the same is permissible. In the light of it the complainant is not entitled for refund of the premium amount paid. As he has paid only 5 half yearly installments and failed to pay renewal premiums despite several reminders sent to him. The complainant has already availed the life coverage out of the premium paid in the subject policy and now in order to wriggle out of the liability of payment of premium is seeking refund of the premium paid, which is not permissible as per the terms and conditions of the policy. At no point of time the complainant came forward to pay the arrears of premium payment with a request to revive the policy. Hence the complaint is liable to be dismissed.
4) In the enquiry the complainant has got filed his evidence affidavit reiterating the substance of the complaint and got exhibited 9 documents. Similarly for the opposite parties evidence affidavit of one Ms.Prithi H Savant the Assistant Vice President – Legal of opposite party No.1 Institutions is got filed and the defense set out therein is in line with the defense set out in the written version. Through her opposite parties got exhibited 7 documents.
5) On a consideration of material on the record the following points have emerged for determination:
- Whether the complainant could make out a case of either deficiency of service or unfair trade practice on the part of the opposite parties?.
- Whether the complainant is entitled for the amounts claimed in the complaint?
- To what relief?
6) Point No.1: The case of the parties as per the record is that the complainant purchased the subject policy known as Kotak Money back policy to pay premium at the rate of Rs.12,177/- for half year for a total period of 20 years and after payment of the 5 premiums he did not pay premiums and the reasons assigned for it are that he fell sick due to Kidney ailment and underwent treatment for 6 months and thereafter got admitted in Apollo hospital on 5.12.2014 and underwent Kidney operation and after recovery to normal health approached opposite party No.1 with a request to revive the policy which was lapsed but opposite party did not accepted. Hence sought for refund of the amount paid by him by way of 5 premiums and same was not considered. The complainant also has claimed that on the advice of opposite party NO.3 he submitted written representation to opposite party No.2 with a request to receive the amount payable towards half yearly premium and revive the policy. But he has not filed the copy of said representation before this Forum. What all he filed are policy document, schedules, terms and conditions, and proposal form and no more. The policy could have revived by the policy holder provided he approaches with a representation agreeing to pay the arrears of premium payable. So there was an option for the complainant to approach the opposite party No.2 with a written representation that he is prepared to pay all the arrears of premium amount due as on date of representation and revive the policy. The complainant having pleaded that he made such a representation did not filed any proof for it. The complainant claimed that several times he approached opposite parties with oral and written representations requesting to receive the arrears of premium amount and to revive the lapsed policy but conveniently did not mention the dates said representations and did not filed either copies of the representations or receipt in proof of sending such representations to the opposite parties. If the complainant paid premium for three years before laps of the policy is entitled for surrender value of the policy to seek refund of the amount paid by way of premium. Admittedly he paid only 5 premiums covering policy for 2 ½ years. As per the terms and conditions of the policy complainant cannot seek refund of the amount. Since the opposite parties acted as per the terms and conditions of the subject policy and as the complainant failed to establish that he approached the opposite parties within two years from the date of lapse of the policy agreeing to pay the arrears of the premium payable with a request to revive the policy, cannot allege either unfair trade practice or deficiency of service on the part of the opposite parties. Hence the point is answered against the complainant.
7) Point No.2: In view of the findings of point No.1 the complainant is not entitled for any of the reliefs prayed for . Accordingly the point is answered
8) In the result, the complaint is dismissed. No order as to costs.
Dictated to steno , transcribed and typed by her and pronounced by us on the10th day of July, 2019.
MEMBER PRESIDENT
APPENDIX OF EVIDENCE
WITNESS EXAMINED
NIL
Exhibits filed on behalf of the Complainant:
Ex.A1 – First premium certificate dt.5.5.2011.
Ex.A2 – Policy document, dt.5.5.2011
Ex.A3 – Agreement & schedule dt.5.5.2011
Ex.A4 – Main schedule, dt.5.5.2011
Ex.A5 – Terms & conditions, dt.5.5.2011
Ex.A6 – Application for insurance policy dt.5.5.2011
Ex.A7 – Acknowledgment
Ex.A8 – Medical records
Ex.A9 – Statement of Account, dt.12.09.2016
Exhibits filed on behalf of the Opposite parties:
Ex.B1 – Application Form
Ex.B2 – Policy copy along with terms and conditions.
Ex.B3 – Copy of benefit illustration
Ex.B4 – Renewal premium payment notice.
Ex.B5 – Statement of payment details
Ex.B6 – Foreclosure intimation of policy at end of revival period.
Ex.B7 – termination of policy at the end of the revival period.
MEMBER PRESIDENT
