Delhi

StateCommission

FA/878/2013

LIC OF INDIA - Complainant(s)

Versus

NEETU - Opp.Party(s)

27 Aug 2018

ORDER

IN THE STATE COMMISSION: DELHI

(Constituted under Section 9 of the Consumer Protection Act, 1986)

 

Date of Decision: 27.08.2018

 

First Appeal-878/2013

 (Arising out of the order dated 04.06.2013 passed in Complainant Case No. 967/2011 by the District Consumer Disputes Redressal Forum (East), Saini Enclave, Delhi)

 

1. Life Insurance Corporation of India,

(The Chief Manager),

Branch Unit-11B, 6, JeevanPragati,

Laxmi Nagar District Centre,

•  

 

2. The Senior Divisional Manager,

Life Insurance Corporation of India,

Divisional Office No.II,

9th Floor, Scope Minar Tower,

       Laxmi Nagar District Centre,

       Delhi-110092.

 

3. The Zonal Manager,

Life Insurance Corporation of India,

Northern Zone,

Jeevan Bharti Tower-II,

Connaught Circus,

New Delhi-110001.

 

All Represented Through:

Its Manager (L&HPF),

Jeevan Prakash Building,

                25, K.G. Marg, New Delhi-110001.      

                   …..Appellant

 

Versus

Mrs. Neetu,

W/o Late Sh. Mahesh Kumar,

R/o 8/59, Trilok Puri,

Delhi-110092.

.….Respondent

 

 

 

CORAM

 

Justice Veena Birbal, President

Salma Noor, Member

 

 

1.      Whether reporters of local newspaper be allowed to see the judgment?

2.     To be referred to the reporter or not?

 

 

Justice Veena Birbal, President

 

1. This appeal is directed against order dated 4.6.13 passed by the Consumer Disputes Redressal Forum (East), Saini Enclave, Delhi (in short, the “District Forum”) in CC No.967/2011 whereby the aforesaid complaint has been allowed and appellant/OP is directed as under:

 

“We direct OP to pay complainant Rs.50,000/- towards the accident benefit under the policy along with a compensation of Rs.5,000/- for the harassment caused besides litigation charges of Rs.3,000/-.

 

OP shall comply with the order within 30 days of receipt failing which they will be liable to pay interest @ 9% per annum for any period of delay.”

 

2.     Briefly the facts relevant for disposal of present appeal are that a complaint under Section 12 of the Consumer Protection Act, 1986 was filed by the respondent herein i.e. the complainant before the District Forum stating therein that her husband had taken a policy bearing No.123444997 from appellant/OP.  The said policy was under the Table and Terms 179-20 having sum assured for a sum of Rs.50,000/- on a quarterly premium of Rs.560/-.  The date of commencement of policy was 4.12.09 and maturity date was 4.12.2026.  The respondent/complainant was a nominee in the said policy.  It was stated that appellant/OP had also collected additional premium for granting the insured Accident Benefit Rider for an additional sum of Rs.50,000/-. The insured had died on 10.3.09.  Respondent/complainant being a nominee under the policy submitted her claim to appellant/OP and they had paid Rs.48,315/- towards basic sum assured of Rs.50,000/- after deducting Rs.1,685/- towards outstanding premium.  The deducted amount was subsequently paid on 27.10.09.  However, accident benefit of Rs.50,000/- under the policy was not paid.  Respondent/complainant had alleged that she was entitled to said amount as her husband had died in an accident.  She took up the matter with appellant/OP for payment of the said benefit but the aforesaid amount was not paid.  Ultimately she filed a complaint before the District Forum praying for accident benefit of Rs.50,000/- with interest on the said amount as well as compensation of Rs.30,000/-.

 

3.     Appellant/OP had contested the complaint by filing written statement wherein it was stated that as the insured had died during auto cover period of the policy, the accident claim was not payable.  Only death claim was payable which was given to her. It was stated that premium due from June, 2008 to December, 2008 was paid on 23.1.09.  The premium due for March, 2009 to September, 2009 was deducted while settling the claim which was subsequently refunded.  

  

4. Respondent/complainant had filed rejoinder as well as evidence by way of affidavit.  Appellant/OP also filed evidence by way of affidavit of Shri G.P. Pandey, Manager (L&HPF) to substantiate their stand.

 

5.     After hearing the parties, the Ld. District Forum held that the insured had died on 10.3.2009.  Insured had paid premium up to December, 2008.  The premium payable on 3.3.09 was not paid.  District Forum held that as per terms and conditions of the policy, there is grace period of one month for payment of yearly, half yearly or quarterly premium and 15 days for monthly premiums.  In the present case, premium was due on 3.3.09.  The insured had grace period up to 3.4.09 for making payment whereas he expired on 10.3.09.  Since he had died within the grace period, policy in question was in full force at the time of death of insured on 10.3.09 and the appellant/OP had erroneously interpreted that the policy was under auto cover condition. The District Forum held that the respondent/complainant was entitled for accidental benefit under the policy and, therefore, awarded the amount of Rs.50,000/- towards accidental benefit and Rs.5,000/- for causing harassment to her and Rs.3,000/- towards litigation cost.

 

6.    Aggrieved with the aforesaid order, present appeal is filed.

       

7. We have heard Counsel for appellant/OP.  None has appeared for respondent/complainant.  We have also perused the record including District Forum record.

 

8. Ld. Counsel for appellant/OP has contended that the policy holder had died on 10.4.09 and not on 10.3.09.  It is contended that District Forum has wrongly taken the date of death of policy holder as 10.3.09.  It is contended that the insured was under auto cover period and Accidental Benefit Rider was not available to him.  It is contended that the grace period was not applicable as the said period had already lapsed on 3.4.09 before the death of the policy holder.  It is submitted that there is material error in the impugned order and the same is liable to be set aside.

 

9. There is no dispute about the insured having taken insurance policy in question from appellant/OP.  The accidental death of the insured is also not disputed.  The relevant clause of the policy on the basis of which the appellant/OP has contended that the policy was under auto cover condition and the respondent/complainant was not entitled for accidental benefit is as under:

 

                       “If after at least two full years premium have been paid and any subsequent premium be not duly paid, full death cover shall continue for a period of two years from the due date of the first unpaid premium.  The period of two years from first unpaid premium shall be called auto cover period.  During the auto cover period, the life assured can pay one or more instalments of the premium with interest without submissions of any evidence of health.  On payment of part or full arrears of premiums with interest, the auto cover period of two years from the due date of FUP shall again be available during the terms of policy.  During auto cover period, though death cover is extended, any SB instalments if falls due, will not be paid, unless premiums are paid and policy brought in force.  During the auto cover period, the accident benefit rider shall not be available.”

    

10.   As per material on record, policy holder had died on 10.4.09 in Max Hospital. Death certificate is also placed on record by appellant/OP which shows that the policy holder had died on aforesaid date.  Even in the complaint filed before the District Forum in para 11, the date of death has been mentioned as 10.4.09.  It appears Ld. District Forum has wrongly taken the date of death as 10.3.09.  It is also admitted position that the policy holder had paid the premium up to December, 2008 and the next premium was payable by March, 2009.  As per policy terms and conditions, grace period of 30 days has been allowed for payment of yearly, half yearly and quarterly premium.  In the present case, the policy holder was paying quarterly premium.  The grace period of 30 days had lapsed on 3.4.09 and the premium was not paid even within the grace period.  The policy holder had died after one week of the expiry of grace period.  In these circumstances, as per policy condition reproduced above, the insured was under auto cover period and during the said period accident benefit rider is not available.  In these circumstances, we find that Ld. District Forum has committed factual error while taking the date of death as 10.3.09 which in fact is 10.4.09 and has passed wrong order.  We, therefore, accept the appeal and set aside the impugned order and consequently dismiss CC No.967/2011.

 

11.   A copy of this order as per the statutory requirements be forwarded to the parties free of charge and also to the concerned District Forum for information.  The record of the District Forum be also sent back forthwith.  Thereafter the file be consigned to record room.      

 

 

 (Justice Veena Birbal)

• President

 

(Salma Noor)

• Member 

 

 

sa