Tamil Nadu

South Chennai

358/2011

Prabhakar K.S - Complainant(s)

Versus

SBI Life Insurance Co. Ltd - Opp.Party(s)

Party in person

29 Dec 2015

ORDER

                                                                          Date of Complaint  : 19.08.2011

                                                                Date of Order        : 29.12.2015

DISTRICT CONSUMER DISPUTE REDRESSAL FORUM, CHENNAI (SOUTH)

2^nd Floor, Frazer Bridge Road, V.O.C. Nagar, Park Town, Chennai-3

 

PRESENT :    THIRU. B. RAMALINGAM, M.A.M.L.,                  : PRESIDENT                     

                     TMT.K. AMALA, M.A. L.L.B.,                                : MEMBER – I

                     DR.T.PAUL RAJASEKARAN, M.A D.Min HRDI, AIII,BCS : MEMBER - II

                                                     

C.C.No. 358 / 2011

THIS  FRIDAY  29^TH  DAY OF  DECEMBER 2015

 

Prabhakar K.S.

New No.2, Q Block 57,

15^th Street, Anna Nagar,

Chennai 600 040.

Tamil Nadu.                                               .. Complainant.

                                                         - Vs-

1.  The Regional Director, SBI Life Insurance Co. Ltd., State Bank Learning Centre Complex, III Floor, No.20, Pycrofts Garden Road, Nungambakkam, Chennai 600 006.   2. The Managing Director, SBI Life Insurance Co. Ltd., “Natraj”. M.V. Road & Western Express Highway Junction, Andheri (East), Mumbai – 400 069.                                      .. Opposite parties.    For the complainant                     :   M/s. K.S. Prabhakar		.. Opposite party.
For the opposite parties                    :   M/s. S.Masilamani

         Complaint under section 12  of the Consumer Protection Act, 1986 for a direction to the opposite parties to pay a sum of Rs.3,00,000/- as damages for mental agony with cost of the complaint to the complainant.    

ORDER

THIRU.   T.PAUL RAJASEKARAN ::    MEMBER-II

1.The case of the complainant is briefly as follows:-

  The complainant submit that he is an employee of the State Bank of India availed a housing loan of Rs.7,00,000/- under public scheme at the rate of 8% interest during 2008 and the complainant’s employer State bank of India had taken a life  insurance cover with State Bank of India Life Insurance Company Limited on diminishing balance of the loan account.    The employer of the complainant and the opposite parties i.e. State Bank of India Life Insurance company, where they have paid the consideration for the group of people who availed the loans for their staff under H.T.L account. Having received the consideration the opposite parties had issued a Super Suraksha Insurance Policy for the members of the group of the Master policy holder, under policy No.30717432990.  Though it is the master policy, the certificate of insurance was given to each member of the group, accordingly the complainant received a copy of certificate of insurance for the loan account number 30001398109 by showing the gross premium received by them as Rs.49,956/- and the coverage on the outstanding balance of Rs.6,67,331/- valid  from 14.9.2005 and confirming the master policy document was issued to the group Administrator who is a master policyholder.    The complainant further submit that the employer of the complainant had given an offer to their employees who can avail further loan to the tune of Rs.20,00,000/- of his eligibility and he requested the employer to provide additional loan and accordingly it was sanctioned and total outstanding loan of the complainant  18.1.2009 is Rs.11,37,236/-.  Wherein the employer of the complainant had foreclosed the first policy Super Suraksha Insurance Policy and asked the opposite party to issue a SBI Life Dhanaraksha plus LPPT policy.   Based on the opposite party had issued a fresh policy by cancelling the Super Suraksha Policy which was not informed to the complainant.    Neither the opposite party nor the employer had informed about the cancellation of the previous policy.   Having received a letter from the opposite party asking him to submit relevant membership form duly witnessed, the complainant had requested the opposite party to enhance the life cover upto Rs.12,00,000/-.  

2.     However the opposite party having received the consideration had not informed to the complainant that his risk was not covered under within mentioned policy.    But he sought the bank to cover the risk for the new HTL account.    Again the complainant paid premium and submitted the filled in application to the opposite party on 19.11.2010 by paying the premium of Rs.39,662/-.   The opposite party has acknowledged the receipt of the premium vide their email dated 17.12.2010 seeking the complainant with and one querries 1. Proposal form not dated and witness.  2. Question No.5 cover details not filled up. 3. Question-3 common health questioner not filled up.   4. Diabetic questioner for point-3 is required. 5. Loan details and the Branch Manger signature of SBI Nungampakkam PBB Chennai not provided.   As such the act of the opposite parties are amounts to deficiency of service and which caused mental agony and hardship to the complainant.   Hence the complaint.

Written version of  1st opposite party is as  follows:-

3.     It denies all the averments and allegation contained in the complaint except those that are specifically admitted herein.   The complainant was covered under the SBI Life Super Suraksha policy under Master policy No.83001000203 w.e.f. 14.9.2005 for a diminishing sum assured Rs.6,67,331/- at inception.   The opposite parties herein have not received any letter or membership from as alleged.  The membership forms for insurance cover will never be accepted by the opposite parties directly from the customers.   The Master policy holder has to attest the loan amount sanctioned by them for which the insurance cover is being proposed premium paid etc. in the membership form.  Assuming, but not admitting, the allegation that the proposal form for enhanced insurance cover was submitted, still the fact remains that premium to cover the enhanced loan amount remained unpaid.   The mere submission of proposal form/membership from will not automatically result in the grant of life insurance cover.  Moreover the loan amount has to be certified by the Master policyholder. Hence the complainant has not justification to make the opposite parties responsible for not providing insurance cover for the enhanced loan amount from 2009 for the simple reason neither the proposal membership from nor requisite premium was received by the opposite parties.  Hence the allegation is without any basis.    The insurance cover was foreclosed as per the statement of the account of the loan from the Master Policy holder with the remarks “A/c closed on 26.3.3009.   This endorsement if open to question, it is for the complainant to take up the issue to the Master policy holder for the simple reason there is no privity of contract between the complainant and the opposite parties.   The opposite parties are not in any way responsible for alleged acts of commissioner or omission on part of the Master policy holder.   It is also specifically denied that the complainant was kept in the dark about the unilateral cancellation of the insurance cover.    The Insurance cover under Super Suraksha Scheme was cancelled in June 2009 based on the statement of accounts of the Master policyholder only.  Hence there is no deficiency in service on the part of the opposite parties  and  the compliant is liable to be dismissed. 

4.   Complainant has filed his Proof affidavit and  Ex.A1 to Ex.A80 were marked on the side of the complainant.    Opposite parties have filed their  proof affidavit and Ex.B1 to Ex.B7 were marked on the side of the opposite parties. 

5.      The points that arise for consideration are as follows:-

1. Whether there is any deficiency in service on the part of the opposite parties ?

 

2. To what relief the complainant is entitled to?  

6.   POINTS 1 & 2 :

   Perused the complaint  filed by the complainant, written version filed by the  opposite parties, proof affidavit filed by the complainant and the  opposite parties and  Ex.A1 to Ex.A80  filed on the side of the complainant and  Ex.B1 to Ex.B7 filed on the side of the opposite parties and  considered both side arguments.

7.     Pursuant of the written version, proof affidavit and oral arguments made by the complainant and the opposite parties learned counsel we found the complainant made allegations on the opposite parties for the negligence and harassment of the opposite parties non providing adequate insurance cover for the premiums / consideration received by the opposite parties.   The complainant is an employee of the State Bank of India availed a housing loan of Rs.7,00,000/- under public scheme at the rate of 8% interest Ex.A1 during 2008 and the complainant’s employer State bank of India had taken a life  insurance cover with State Bank of India Life Insurance Company Limited on diminishing balance of the loan account.    The privity of contract is between a employer of the complainant (State Bank of India) and the opposite party i.e. State Bank of India Life Insurance company where they have paid the consideration for the group of people who availed the loans for their staff under H.T.L account.   Having received the consideration, the opposite parties had issued a Super Suraksha Insurance Policy for the members of the group of the Master policy holder under policy No.30717432990.  Though it is the master policy the certificate of insurance was given to each member of the group.  Accordingly the complainant received a copy of certificate of insurance for the loan account number 30001398109 by showing the gross premium received by them as Rs.49,956/- the coverage on the outstanding balance of Rs.6,67,331/- (Sum insured) valid  from 14.9.2005 and confirming the master policy document was issued to the group Administrator (Ex.A43).     The employer of the complainant had given an offer to their employees who can avail further loan to the tune of Rs.20,00,000/- of his eligibility based on this he requested the employer to provide additional loan and accordingly it was sanctioned and total outstanding loan of the complainant  18.1.2009 is Rs.11,37,236/-.  Wherein the employer of the complainant had foreclosed the first policy Super Suraksha Insurance Policy and asked the opposite party to issue a SBI Life Dhanaraksha plus LPPT policy.  Accordingly the opposite party had issued a fresh policy by cancelling the Super Suraksha Policy which was not informed to the complainant.  Had this action would have been informed by the employer to their borrower the complainant would have been approached his employer whatever the difference of premium for his inclusion into the new scheme he would have paid.   Neither the opposite party nor the employer had informed about the cancellation of the previous policy.   Having received a letter from the opposite party asking him to submit relevant membership form duly witnessed, the complainant under Ex.A16 has requested the opposite party to enhance the life cover upto Rs.12,00,000/-.   However the opposite party having received the consideration had not informed to the complainant that a risk was not covered.   But he sought the bank to cover the risk for the new HTL account under Ex.A17.    Again the complainant paid premium and submitted the filled in application to the opposite party on 19.11.2010 by paying the premium of Rs.39,662/- under Ex.A22.   The opposite party had acknowledged the receipt of the premium vide their email dated 17.12.2010 seeking 1. Proposal form not dated and witness.  2. Question No.5 cover details not filled up. 3. Question-3 common health questioner not filled up.   4. Diabetic questioner for point-3 is required. 5. Loan details and the Branch Manger signature of SBI Nungampakkam PBB Chennai not provided. 

8.     In the written version of the opposite parties clearly mentioned the privity of contract is between the Master policy holder (SBI) and the SBI Life Insurance Company and there is no need for separate proposal to insisted upon from the complainant.  But the opposite party had insisted the proposal and other relevant documents on 17.12.2010 which is found to be harassment  by the opposite party.  The opposite party contention, the employer SBI has not been impleaded in this case.   But all the communications were transpired between the complainant and the opposite party.   Though it is the failure of the complainant in impleading the employer in this case but, he cannot be denied of his rights as a consumer having paid a huge premium to cover his life risk.   His contention is because of non coverage of his risk his family would have been left in dark, in the event of any unforeseen risk happens to his life.  

9.     The other allegation of the complainant is they have refunded Rs.20,702/- on 19.6.2009 vide cheque No.911304 as per Ex.A31 opposite parties letter dated 20.7.2010.    The privity of contract is between SBI and SBI Life Insurance in the master policy issued to the SBI the request for cancellation should have been from the master policy holder and the refund would have been effected to master policy holder by the opposite party.  In turn the SBI should have refunded the premium to the complainant.  There is no proper evidence from the opposite parties the refund made by them whether to the master policy holder or to the complainant to substantiate.   No proof has been submitted.     Hence the complainant has approached the country head of the opposite party and he had replied to the complainant on 6.10.2010 as a special case the foreclosed policy would have been reinstated (Ex.A42).   If the rein- statement is made for the foreclosed policy there is no proof for the reinstatement when it has been effected or not.  Whether it is with  retrospective effect or from the date of his letter i.e. 6.10.2010 in Ex.A47.  The complainant had given a worksheet and the actual premium to be paid for the uncovered portion as on 1.11.2010 is Rs.10,54,040/- and it is as per staff’s scheme.   Inspite of many communications transacted between the complainant and the opposite parties no results had come in hand.  Hence he approached the Banking Ombudsman in Chennai (Ex.A52) and the Banking Ombudsman replied on 18.1.2011 “this complainant does not come under Clause-8 of Banking Ombudsman 2006 and the matter was closed under Clause-13(a) of Banking Ombudsman” (Ex.A54).   

10.    The complainant approached insurance regulatory Development Authority Ex.A62 to Ex.A68 where IRDA had referred the matter to the opposite party to resolve the matter as earliest as possible.   Having dejected from all sources the complainant approached this forum to seek remedy and praying this forum to refund the premium of Rs.68,667/- along with compensation of Rs.3,00,000/- and litigation charges.  

11.    On perusal of the written version filed by both the parties, we are of the considered view that the complainant though he has not impleaded his employer SBI in this case but all the transactions / communications were exchanged between the opposite party and the complainant without giving any room or direction to the complainant to approach his employer for any discrepancies or any litigations and to contact his employer.   The SBI Life Insurers would have informed the complainant in advance to approach his employer, these problems should not have arised.   The complainant had made all the communications with the opposite party which had created a panic if any un-eventualities  happens to his life, his family will be put into problem.   Hence it is construed the negligent on the part of the insurer.  

12.    The privity of contract is between the master policy holder and insurer the allegations raised by the complainant for having received the refund of Rs.20,702/ there is no documentary evidence to substantiate whether this amount had been refunded the complainant or to the master policy holder, we could not ascertain where this amount had gone into. Neither the complainant nor the opposite party had submitted the evidence to this forum to establish the refund had been effected or not.    

13.    Since the first policy was issued in 2005 and subsequent policy request were made in 2009 and subject policy was issued by cancelling the Super Suraksha policy  with a new Dhanaraksha plus LPPT policy and there was a gap without no insurance.  This itself proves there is a dereliction on the part of the opposite party to take appropriate steps to inform the complainant in time, since all communications were directly handled with the complainant without impleading the master policy holder.  

14.    The  opposite  party  had submitted  the  policy condition to this forum under   Ex.B1 & Ex.B2  wherein  the  condition  No.13 within mentioned policy, “This master policy may be discontinued at the option of the master policy holder or the company for new members for giving the other party atleast 3 months prior notice in writing”.    We found that there is no such notice have been exchanged and no proof had been submitted to this forum.   By going through the available documents submitted to this forum by the complainant and the opposite party, we are of the considered view that the refund of premium claimed by the complainant could not be accepted.   Because he has availed the coverage from the opposite parties but the complainant was given lot of harassment  which had created mental agony and tension to the complainant, had  exchanged  lot  of  harsh  negotiations / communications which would have  been  avoided  by  him  and  the  opposite  party  is  liable  to pay  compensation of Rs.25,000/- and also to pay a sum of Rs.5,000/- as litigation expenses to the complainant.  As such the points 1 & 2 are answered in favour of the complainant.

In the result, the complaint is partly allowed.  The opposite parties 1 & 2 are jointly and severally directed to pay a sum of Rs.25,000/- (Rupees Twenty Five thousand only) as compensation  and also to pay a sum of Rs.5,000/- (Rupees five thousand only)  as litigation expenses to the complainant within six weeks from the date of receipt of this order failing which the compensation amount (Rs.25,000/-)  shall carry  interest at the rate of 9% p.a. from the date of this order to till the date of payment.

        Dictated directly by the Member-II to the Assistant, transcribed and computerized by her, corrected by the Member-II and pronounced by us in the open Forum on this the  29th    day of  December   2015.

 

MEMBER-I                        MEMBER-II                             PRESIDENT.

Complainant’s side documents :

Ex.A1- 10.7.2008      - Copy of letter to SBI, PBB, Nungambakkam Branch.

Ex.A2- 26.11.2008    -                            - do —

Ex.A3- 29.12.2008    -                            - do -

Ex.A4- 12.3.2009      -                            - do –

Ex.A5- 16.3.2009      -                            - do –

Ex.A6- 11.4.2009      -                            - do –

Ex.A7- 18.5.2009      -                            - do –

Ex.A8- 21.12.2009    -                            - do –

Ex.A9- 9.4.2010       -                            - do –

Ex.A10-10.6.2010     -                            - do –

Ex.A11- 13.7.2010    - Copy of letter to SBI, PBB, Nungambakkam branch

                              Covering letter with representation.

Ex.A12- 12.8.2010    - Copy of letter to SBI, PBB, Nungambakkam Branch

                               Covering letter with representation.

 

Ex.A13- 24.8.2010         - Copy of letter to SBI, PBB Nungambakkam Branch,

                               Covering letter with representation.

Ex.A14- 23.8.2010         - Copy of letter to SBI, PBB, Nungambakkam Branch,

                                Covering letter with representation.

Ex.A15- 30.12.2010– Copy of letter to SBI, PBB, Nungambakkam Branch,

Ex.A16- 18.5.2009         - Copy of letter addressed to SBI Life, Chennai.

Ex.A17- 22.12.2009               - do -

Ex.A18- 7.1.2010  -                 - do–

Ex.A19- 9.4.2010  -                 - do - 

Ex.A20- 10.6.2010         -                 - do –

Ex.A21- 5.7.2010  -  Copy of letter addressed to SBI Life Chennai covering

                                Letter with representation.

Ex.A22- 15.12.2010 – Copy of email addressed to SBI Life, Chennai.

Ex.A23- 17.12.2010 -              - do -

Ex.A24- 21.12.2010 -              - do 

Ex.A25- 5.7.2010  - Copy of email letter addressed to Client relationship;

                                 SBI Life, Mumbai.

Ex.A26- 5.7.2010  -                 - do –

Ex.A27- 6.7.2010  -  Copy of email from Client relationship, SBI life Mumbai.

Ex.A28- 7.7.2010  -                  - do –

Ex.A29- 11.7.2010         -                  - do –

Ex.A30- 16.7.2010         -                  - do 

Ex.A31- 20.7.2020 -                - do –

Ex.A32- 28.7.2010         -                  - do –

Ex.A33- 29.7.2010 -                - do –

Ex.A34- 11.8.2010 -                - do –

Ex.A35- 12.8.2010 -                -do –

Ex.A36- 22.8.2010 -  Copy of email to country Head, SBI Life, Mumbai.

Ex.A37- 26.8.2010         -                  - do –

Ex.A38- 26.8.2010 -  Copy of email from country Head, SBI Life, Mumbai.

Ex.A39- 2.9.2010  -  Copy of email to country Head, SBI Life, Mumbai.

Ex.A40- 2.9.2010  -  Copy of email to country Head, SBI Life, Mumbai.

Ex.A41- 6.9.2010  -  Copy of email from country Head, SBI Life, Mumbai.

Ex.A42- 6.10.2010 -  Copy of letter from Country Head, SBI Life, Mumbai.

Ex.A43-       -       -  Copy of policy certificate dated 19.9.2005.

Ex.A44- 11/12.10.10  -  Copy of email to country Head, SBI Life, Mumbai.

Ex.A45- 18.10.2010-  Copy of letter by General Manager, SBI, NW-2,AU,

                                Coimbatore.

Ex.A46- 18.10.2020 –Copy of letters to Chief General Manager, Two General   

                                 Managers of SBI, Local Head Office, Chennai.

Ex.A47- 8.11.2010 -   Copy of email to Chief Manger and Two G.Ms referred

                                above.

Ex.A48- 28.10.2010 – Copy of email to Chief Manager, BOPM, LHO, Chennai.

Ex.A49- 31.12.2010 – Copy of email to Chief Manager, BOPM, LHO, Chennai.

Ex.A50- 31.12.2010  - Copy of email from Chief Manager, BOPM, LHO, Chennai.

Ex.A51- 3.1.2011     - Copy of email to Chief Manager, BOPM, LHO, Chennai.

Ex.A52- 31.12.2010  - Copy of email to banking Ombudsman (BO), Chennai.

Ex.A53- 13.1.2011    - Copy of Auto Acknowledgment from B.O., Chennai.

Ex.A54- 18.1.2011            - Copy of Letter from Banking Ombudsman, Chennai.

Ex.A55- 2.2.2011    - Copy of email appeal to Appellate authority, B.O.,

Ex.A56- 25.2.2011    - Copy of email reminder to Appellate Authority, B.O..,

Ex.A57- 25.3.2011            - Copy of email reminder to Appellate Authority, B.O.,

Ex.A58- 18.4.2011         -  Copy of letter from Banking Ombudsman, Chennai.

Ex.A59- 19.4.2011         -  Copy of email to Banking Ombudsman, Chennai.

Ex.A60- 23.11.2010- Copy of email to IRDA, Hyderabad.

Ex.A61- 25.11.2010- Copy of email to IRDA, Hyderabad.

Ex.A62- 25.11.2010- Copy of email response from IRDA, Hyderabad.

Ex.A63- 26.11.2011- Copy of email response from IRDA, Hyderabad in the

                                Prescribed format.

Ex.A64- 30.11.2010- Copy of email & letter to IRDA, repeated at their request.

Ex.A65- 3.12.2011         - Copy of email to personnel of IRDA, Hyderabad.

 

Ex.A66- 14.3.2011

             17.3.2011         -  Copy of email to IRDA, Hyderabad and its personnel.

 

Ex.A67- 19.5.2011 -  Copy of email to IRDA, Hyderabad and its personnel.

Ex.A68- 15.7.2011         -  Copy of email to IRDA, Hyderabad and its personnel.

 

Ex.A69- 18.7.2011         -  Copy of  letter to Asst. General Manager, Region II, SBI

                                Zonal Office, NW-1, AU, Chennai.

 

Ex.A70- 16.3.2009         -  Copy of letter addressed to SBI, PBB, Nungambakkam,

                               Forwarded to the Asst. General Manager, R-2, NW-1, AU

                               Chennai.

Ex.A71- 21.12.2009 -              - do –

Ex.A72- 7.1.2010    - Copy of letter to Asst. General Manager, Region II SBI,

                                Zonal Office, NW-1, AU, Chennai.

 

Ex.A73- 11.6.2010   -              - do –

 

Ex.A74- 5.7.2010    - Copy of letter to Asst. General Manager, Region II, SBI,

                                Zonal office, NW-2, AU, Chennai through SBI, SARB

                                Pondicherry.

 

Ex.A75- 23.8.2010         - Copy of letter addressed to SBI, PBB, Nungambakkam,

                              Forwarded to the Asst. General Manager, R-2, NW-1, AU

                              Chennai.

 

Ex.A76- 24.8.2010 – Copy of letter to Asst. General Manager, Region II,SBI,

                               Zonal office, NW-2, AU, Chennai through SBI, SARB

                               Pondicherry.

 

Ex.A77- 16.3.2009         - Copy of letter addressed to SBI, PBB, Nungambakkam,

                               Forwarded to the Asst. General Manager, R-5, NW-1,

                               AU, Chennai.

 

Ex.A78- 7.1.2010 - Copy of letter to Asst. General Manager, Region V, SBI,

                              Zonal office, Nw-2, AU, Chennai.

 

Ex.A79- 7.1.2010 – Copy of letter received from SBI Life, Chennai.

 

Ex.A80- 12.1.2010 –Copy of letter received from SBI Life, Chennai.

 

 

                                                         

Opposite parties’ documents : -

 

Ex.B1-         -       - Copy of the Master Policy.

Ex.B2-         -       - Copy of the Master policy.

Ex.B3-  7.1.2010   - Copy of letter addressed to the complainant.

Ex.B4- 24.8.2010 -  Copy of letter by SBI, Pondicherry to SBI, P.B. Branch,

                               Nungampakkam, Chennai.

 

Ex.B5- 6.10.2010  -  Copy of letter by the complainant

 

Ex.B6- 8.3.2011    -  Copy of Premium Certificate.

 

Ex.B7- 1.10.2010  -  Copy of Certificate of insurance.

 

 

 

 

MEMBER-I                        MEMBER-II                             PRESIDENT.