State Consumer Disputes Redressal Commission
Reliance Life Insurance Company ... vs Ashwani Kumar on 27 September, 2012
2nd Bench
STATE CONSUMER DISPUTES REDRESSAL COMMISSION, PUNJAB
SECTOR 37-A, DAKSHIN MARG, CHANDIGARH.
First Appeal No.108 of 2011.
Date of Institution: 20.01.2011.
Date of Decision: 27.09.2012.
1. Reliance Life Insurance Company Limited, Registered Office H Block,
Ist Floor, Dhirubhai Ambani, Knowledge City, Navi Mumbai,
Maharashtra.
2. Regional Manager, Head Office, Reliance Life Insurance Company
Limited, SCO No.142-143, Sector 8-C, Chandigarh.
.....Appellants.
Versus
Ashwani Kumar S/o Sh. Prem Lal, Resident of Mohalla Dolian Wala, Street
Dr. Satpal, Ferozepur City.
...Respondent.
First Appeal against the order dated
25.10.2010 of the District Consumer
Disputes Redressal Forum, Ferozepur.
Before:-
Shri Inderjit Kaushik, Presiding Member.
Shri Baldev Singh Sekhon, Member.
...................................
Present:- Sh. R.K. Kakkar, Advocate, counsel for the appellants.
Ms Riffi Birla, Advocate, counsel for the respondent.
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INDERJIT KAUSHIK, PRESIDING MEMBER:-
Reliance Life Insurance Company Limited & Another, appellants (In short "the appellants") have filed this appeal against the order dated 25.10.2010 passed by the learned District Consumer Disputes Redressal Forum, Ferozepur (in short "the District Forum").
2. Facts in brief are that Sh. Ashwani Kumar, respondent/ complainant (hereinafter called as "the respondent") filed a complaint under section 12 of the Consumer Protection Act, 1986 (in short, "the Act") against the appellants, making assertions that he invested Rs.30,000/- in Reliance Super Invest Assure Plan vide insurance policy no.14195360 dated First Appeal No.108 of 2011 2 28.03.2009 and the policy cover was received on 28.03.2009 which was issued by the appellants. After going through the terms and conditions, the respondent did not like to continue the policy further and moved an application on 28.04.2009 for cancellation of the above policy which was received by Tejinder Singh (OP-3, not made party in appeal), who was working in the office of Life Insurance Anil Dhirubhai Ambani Group Branch at Faridkot and he disclosed that the policy can be cancelled within one month and he can receive the request within the prescribed period and beyond that, he is not authorized to entertain any request and the respondent requested for the cancellation of the policy, as being within the limitation. He disclosed that he is to receive instructions from the authority to cancel the policy, but even after receiving the request on 28.04.2009 and reminder dated 28.05.2008, the policy of the respondent was not cancelled by the appellants. OP-3 also disclosed that both the requests dated 28.04.2009 and 25.05.2009 had been forwarded to appellant no.1 and as and when the information regarding the refund of the amount from the Regional Manager is received, then OP-3 has the power to refund the amount. The respondent also issued a legal notice sent through post on 27.07.2009, but no reply was received. OP- 3 kept on putting off the matter and the respondent suffered lot of mental harassment, agony and financial loss and is entitled to recover Rs.30,000/- along with compensation of Rs.50,000/- and litigation expenses Rs.5,000/-.
3. The respondent applied under A.I.P. Scheme and in this scheme, there was deduction of 10%, whereas the appellant no.2 in cleverly manner issued the policy of the company to respondent under the S.I.P scheme and in that policy, there was deduction of 80% and this was done by appellant no.1 to take benefit and OP-4 (not made party in appeal) obtained the signatures of the respondent by misleading him about the category of S.I.P. scheme. The appellants and OPs replied that there is 15 days 'free look period', but this was never disclosed, whereas OP-3 disclosed that the policy can be cancelled within one month. The original cover note was sent by the First Appeal No.108 of 2011 3 respondent to appellant no.1 along with request dated 28.04.2009 and the same is still lying with the appellants.
4. It was prayed that the appellants be directed to refund Rs.30,000/- deposited by the respondent along with compensation of Rs.50,000/- and litigation expenses Rs.5,000/-.
5. In the reply filed on behalf of the appellants, preliminary objections were raised that the respondent has made false statement and has not come to the Forum with clean hands. The response to the e-mail was given and reply to the notice was also given, but the same was not placed on record. The various other communications were exchanged between the respondent and appellant no.1 and it was admitted through e-mails that the respondent received the policy on 08.04.2009 after reading the terms and conditions of the policy and the request for cancellation was beyond the prescribed period. 'Free look period' is for a period of 15 days from the date of receipt of the policy of the insurance and the same has also been provided under provisions of Insurance Regulatory Development Authority(IRDA) which is a statutory body. No such request was made within 15 days of the receipt of the policy and the policy has been issued strictly in accordance with the satisfaction of the respondent and the inability to cancel to the policy after the look in period was duly intimated to the respondent.
6. On merits, similar pleas as raised in preliminary objections were repeated and denying allegations of the complaint, it was prayed that the complaint may be dismissed.
7. Name of OP-3 was deleted from the complaint vide order dated16.08.2010 of the District Forum.
8. OP-4 did not contest the complaint before the District Forum and was proceeded against exparte vide order dated 12.05.2010 of the District Forum.
9. Contesting parties led evidence in support of their respective contentions by way of affidavits and documents.
First Appeal No.108 of 2011 4
10. After going through the documents and material placed on file and after hearing the learned counsel for the parties, the learned District Forum observed that there is no evidence on the file that such a clause of 'free look period' of 15 days was ever brought to the knowledge of the respondent. The appellants failed to prove on file the original document in question, its copy or any such proforma document from which it can be gathered that the respondent was duly told/apprised about the 'free look period' of 15 days and not 30 days. It can be assumed that the respondent was told that there was 'free look period' of 30 days which is available to him and he exercised his right within 20 days, and the complaint was allowed and refund of the premium was ordered.
11. Aggrieved by the impugned order dated 25.10.2010, the appellants have come up in appeal.
12. We have gone through the pleadings of the parties, perused the record of the learned District Forum and have heard the arguments advanced by the learned counsel for the parties.
13. Learned counsel for the appellants has contended that as per notification dated 16th October, 2002 of Insurance Regulatory Development Authority, there is 15 days 'free look period' provided to cancel the policy in case the terms and conditions are not acceptable to the insured. The respondent himself has admitted that he received the policy on 08.04.2009 and filed the application for cancelation on 28.04.2009 and that was beyond the period of 15 days and, as such, the policy was not cancelled. Free look cancelation request is Ex.C-4. The respondent never surrendered the original policy and without that the policy could not be cancelled and there was no deficiency in service on the part of the appellants and the order of the District Forum suffers from serious infirmities and is illegal and the appeal may be accepted.
First Appeal No.108 of 2011 5
14. On the other hand, it was argued on behalf of the respondent that the order of the District Forum is legal and valid and the appeal merits dismissal.
15. We have considered the respective submissions made on behalf of the parties and have carefully gone through the entire record placed on the file.
16. The Common Proposal Form for Life Insurance Linked Plan is Ex.R-3 which was filled on 22.03.2009 and the policy period was 15 years and the premium amount was Rs.30,000/-. The Benefit Illustration of Reliance Super Invest Assure Plan is Ex.R-14. Ex.R-10 is the 'Free look Cancellation Request" dated 28.04.2009. The appellants have not placed on file any policy document or any other document to prove that the original policy was sent to the respondent. The appellants have also not complied with Regulation No.6 (2) of the Insurance Regulatory Development Authority (Protection of Policyholders' Interests) Regulation, 2002. The Regulation No.6 (2) reads as under:-
"While acting under regulation 6(1) in forwarding the policy to the insured, the insurer shall inform by the letter forwarding the policy that he has a period of 15 days from the date of receipt of the policy document to review the terms and conditions of the policy and where the insured disagrees to any of those terms or conditions, he has the option to return the policy stating the reasons for his objections, when he shall be entitled to a refund of the premium paid, subject only to a deduction of a proportionate risk premium for the period on cover and the expenses incurred by the insurer on medical examination of the proposer and stamp duty charges".
17. From the above regulation, it is clear that while forwarding the policy to the insured, the insurer has to inform by the letter forwarding the policy that he has a period of 15 days from the receipt of the policy document First Appeal No.108 of 2011 6 to review the terms and conditions of the policy and where the insurer does not agree with the terms and conditions of the policy, he has the option to return the policy and he shall be entitled for the refund of the premium paid subject only to a deduction of a proportionate risk premium for the period on cover and the expenses incurred by the insured on medical examination of the proposal and stamp duty charges. The appellants have not placed on record any such letter through which the policy was forwarded and the intimation regarding the 'free look period' was given to the insured. The appellants were legally bound and it is a mandatory provision to bring it to the notice of the insurer that there is only 15 days 'free look period', but that has not been done. No policy document is on record. The order of the District Forum is detailed and speaking order and there is no ground to interfere with the same, except that the premium has to be refunded subject only to a deduction of proportionate risk premium for the period on cover and the expenses incurred by the insurer on medical examination of the proposer and stamp duty charges.
18. In view of above discussion, the impugned order under appeal dated 25.10.2010 passed by the District Forum is modified to the extent that the premium has to be refunded to the respondent subject only to a deduction of proportionate risk premium for the period on cover and the expenses incurred by the insurer on medical examination of the proposer and stamp duty charges, and the appeal filed by the appellants is accordingly disposed of. No order as to costs.
19. The appellants had deposited an amount of Rs.15,000 with this Commission at the time of filing of the appeal. This amount with interest accrued thereon, if any, be remitted by the registry to the respondent/complainant by way of a crossed cheque/demand draft after the expiry of 45 days under intimation to the learned District Forum and to the appellants.
First Appeal No.108 of 2011 7
20. Remaining amount as per this order shall be paid by the appellants to the respondent/complainant within 45 days of the receipt of the copy of the order.
21. The arguments in this appeal were heard on 26.09.2012 and the order was reserved. Now the order be communicated to the parties.
22. The appeal could not be decided within the stipulated timeframe due to heavy pendency of court cases.
(Inderjit Kaushik) Presiding Member (Baldev Singh Sekhon) Member September 27, 2012.
(Gurmeet S)