Order No.  11  dt.  24/04/2018

        The case of the complainant in brief is that the complainant obtained one LIC policy bearing no.496498807 on 28.2.11 from Serampore LIC Branch office under Howrah Division office having sum assured amount of Rs.72,000/- and maturity date was on 28.2.16. The premium was paid through ECS @ Rs.600/- per month to o.p. no.1. In the said policy the assured was mentioned as Rs.72,000/- whereas on maturity the complainant got only Rs.35,984/- from o.p. no.1 without any details of payment. The complainant deposited the original policy after the date of maturity. After receiving the amount of Rs.35,984/- the complainant sent a letter asking the o.p. no.1 details and reasons of not paying of full maturity amount. After the lapse of several months the complainant received an intimation from o.p. no.2 which was false, afterthought and the same was not correct. On the basis of the said fact the complainant filed this case praying for direction upon the o.ps. for payment of the balance amount of Rs.36,016 plus interest Rs.23,781/- and compensation of Rs.1 lakh and litigation cost of Rs.30,000/-.

            The o.p. nos. 1 and 2. contested this case by filing w/v and denied all the material allegations of the complaint. It was stated that the complainant purchased the insurance policy by paying monthly premium of Rs.600/- (ECS mode) per month for a term of 5 year and also premium paying term was of 5 years. Bima Account-I/policy is not a traditional / Endowment type of policy where death benefit and maturity benefit are equal and is called Sum Assured. This type of policy is known Variable Insurance Policy, in such type of policy a part of the premium is used for giving death benefit which includes (i) Expense Charge, (ii) Mortality Charge, (which is known as sum assured and is equal to 10 times of yearly premium i.e. 600 x 2 =7200 x 10 = 72000) and the other part is kept in account of the policy holder is known as balance account, wherein a guaranteed interest as declared in advance is paid to the policy holder. On death during the term of the policy, death benefit which is equal to sum assured plus amount if any lying in the balance account with interest accrued thereon is paid, provided the policy holder died within the terms of the policy. After survival of the term (i.e. if the policy holder do not die within the term of the policy), which is not called sum assured and is called maturity benefit, the benefit payable is the balance of the premium plus interest accrued thereon is paid to the policy holder, but not the sum assured. Under Table 805 the policy holder’s account will earn a guaranteed interest of 6% per annum which was payable at the time of maturity of the policy. Since the policy was taken for a term of 5 years so after the expiry of the said term the amount accrued in the balance account together with guaranteed interest @ 6% is paid as per the terms and conditions of the policy. The Manger CRM, Howrah Divisional Office, LIC vide his letter dt.23.6.16 provided the entire calculation. Moreover, the death benefit and maturity benefit were absolutely mentioned under the head benefit payable and events of the happening of which they are payable. The complainant was informed that the maturity value of Rs.35,984/- was correctly paid to the complainant as per the terms and conditions of the policy. After deducting the amount of Rs.4772.07 from the total premium of Rs.36,000/- paid under the policy, the premium balance became to Rs.31,227.93 (the amount of Rs.4772.07 is arrived at after deducting the expenses charges of 27.50% from the 1^st year’s premium, 7.5% from the 2^nd and 3^rd year’s premium and 5% from the remaining year’s premium including mortality charges of Rs.557.07). The interest earned during the term of the policy on the premium balance was Rs.4756.28, therefore total amount of Rs.35,984/- was paid to the complainant as the maturity value of the policy. Since there was no deficiency in service on the part of o.ps. the case is to be dismissed.

            In spite of receipt of notice the o.p. no.3 did not contest this case by filing w/v and as such, the case has proceeded ex parte against them.

            On the basis of the pleadings of parties the following points are to be decided:

1. Whether the complainant had the policy with o.ps.?
2. Whether after maturity the complainant was provided with maturity amount as per the terms of the policy?
3. Whether there was any deficiency in service on the part of o.ps.?
4. Whether the complainant will be entitled to get the relief as prayed for?

Decision with reasons:

            All the points are taken up together for the sake of brevity and avoidance of repetition of facts.

            Ld. lawyer for the complainant argued that the complainant obtained one LIC policy bearing no.496498807 on 28.2.11 from Serampore LIC Branch office under Howrah Division office having sum assured amount of Rs.72,000/- and maturity date was on 28.2.16. The premium was paid through ECS @ Rs.600/- per month to o.p. no.1. In the said policy the assured was mentioned as Rs.72,000/- whereas on maturity the complainant got only Rs.35,984/- from o.p. no.1 without any details of payment. The complainant deposited the original policy after the date of maturity. After receiving the amount of Rs.35,984/- the complainant sent a letter asking the o.p. no.1 details and reasons of not paying of full maturity amount. After the lapse of several months the complainant received an intimation from o.p. no.2 which was false, afterthought and the same was not correct. On the basis of the said fact the complainant filed this case praying for direction upon the o.ps. for payment of the balance amount of Rs.36,016 as well as other reliefs.

            Ld. lawyer for the o.p. nos.1 and 2 argued that the complainant purchased the insurance policy by paying monthly premium of Rs.600/- (ECS mode) per month for a term of 5 year and also premium paying term was of 5 years. Bima Account-I/policy is not a traditional / Endowment type of policy where death benefit and maturity benefit are equal and is called Sum Assured. This type of policy is known Variable Insurance Policy, in such type of policy a part of the premium is used for giving death benefit which includes (i) Expense Charge, (ii) Mortality Charge, (which is known as sum assured and is equal to 10 times of yearly premium i.e. 600 x 2 =7200 x 10 = 72000) and the other part is kept in account of the policy holder is known as balance account, wherein a guaranteed interest as declared in advance is paid to the policy holder. On death during the term of the policy, death benefit which is equal to sum assured plus amount if any lying in the balance account with interest accrued thereon is paid, provided the policy holder died within the terms of the policy. After survival of the term (i.e. if the policy holder do not die within the term of the policy), which is not called sum assured and is called maturity benefit, the benefit payable is the balance of the premium plus interest accrued thereon is paid to the policy holder, but not the sum assured. Under Table 805 the policy holder’s account will earn a guaranteed interest of 6% per annum which was payable at the time of maturity of the policy. Since the policy was taken for a term of 5 years so after the expiry of the said term the amount accrued in the balance account together with guaranteed interest @ 6% is paid a per the terms and conditions of the policy. The Manger CRM, Howrah Divisional Office, LIC vide his letter dt.23.6.16 provided the entire calculation. Moreover, the death benefit and maturity benefit were absolutely mentioned under the head benefit payable and events of the happening of which they are payable. The complainant was informed that the maturity value of Rs.35,984/- was correctly paid to the complainant as per the terms and conditions of the policy. After deducting the amount of Rs.4772.07 from the total premium of Rs.36,000/- paid under the policy, the premium balance became to Rs.31,227.93 (the amount of Rs.4772.07 is arrived at after deducting the expenses charges of 27.50% from the 1^st year’s premium, 7.5% from the 2^nd and 3^rd year’s premium and 5% from the remaining year’s premium including mortality charges of Rs.557.07). The interest earned during the term of the policy on the premium balance was Rs.4756.28, therefore total amount of Rs.35,984/- was paid to the complainant as the maturity value of the policy. Since there was no deficiency in service on the part of o.ps. the case is to be dismissed.

            Considering the submissions of the respective parties it is an admitted fact that the complainant obtained a policy from o.ps. being policy no. 496498807. The mode of payment of the monthly premium was Rs.600/- and the policy issued for 5 years. After the maturity of the policy period the complainant was provided with an amount of Rs.35,984/-. The complainant claimed that the sum assured was Rs.72,000/-, she was given Rs.35,984/- and as such she claimed the balance amount as well as other reliefs. On perusal of the policy document as well as materials on record it is crystal clear that the complainant obtained the policy Under Table 805 and the said policy it was categorically stated that the policy holder’s account will earn of guaranteed interest @ 6% per annum which is payable at the time of maturity of the policy. Since the policy was taken for a term of 5 years of monthly premium of Rs.600/- per month, so after the term was over the amount accrued in the balance account together with guaranteed interest @ 6% was paid as the terms and conditions of the policy. It appears from the materials on record that the complainant before filing of this case wanted to know as to why she was paid lesser amount than that of the premium paid by her which was clarified by o.ps. vide a letter dt.6.11.17 and the complainant was informed that the maturity value of Rs.35,984/- was correctly paid to the complainant as per the terms of the policy. In the policy document itself it was mentioned that after deducting an amount of Rs.4772.07 from the total premium of Rs.36,000/- paid under the policy the premium balance became to Rs.31.227.93. The insurance company had also clarified as to how they arrived at the amount of Rs.4772.07 which has been mentioned in the .4 of the terms and conditions of the policy. The amount of Rs.4772.07 was arrived after deducting the expenses charges of 27.50% from the 1^st year’s premium, 7.5% from the 2^nd and 3^rd year’s premium and 5% from the remaining year’s premium including mortality charges of Rs.557.07). On the basis of such calculation the amount was arrived at Rs.35,984/- which  was paid to the complainant as the maturity value of the policy. The said fact was informed to the complainant prior to filing of this case. in spite of clarification of the calculation made by o.ps. the complainant in order to have illegal gain from o.ps. filed this case without having any cogent ground whatsoever. The amount was paid to the complainant by o.ps. as per the terms of the policy. In case of death of the policy holder the sum assured would have been provided by o.ps. but here in this case, the question of payment of sum assured never arose. Accordingly, we hold that the case filed by the complainant has got no merit and the complainant will not be entitled to get any relief as prayed for. Thus all the points are disposed of accordingly.

            Hence, ordered,

            That the CC No.304/2017 is dismissed on contest without cost against the o.p. nos.1 and 2 and dismissed ex parte without cost against the o.p. no.3.