Case Study -LIFE INSURANCE CORPORATION OF INDIA VS.

MANMATH KUMAR AICH

The brief facts of the case are that the insured had an insurance policy commencing from 20-09-98. The complaint was the nominee under the policy and the dispute arose regarding the date of the death of the insured. The contention of the insurer was that as per the complainants letter his father died on 14-05-92 whereas the complainant/son of the deceased insured contended that the date of death was 14-05-89. The district forum accepted the case of the insurer and held that the policy had lapsed when the insured died and directed for repayment of the premium amount only. In appeal by the complainant the state commission observed that from the perusal of the document on the record it was clear that the date of death mentioned by the complainant was 14-05-89. That apart even the death certificate which is public record issued by the health officer indicated the date of death as 14-05-89. The insurer also admitted to having received two half yearly premiums September 88 and March 89. And if they received March 89 premium apparently if it is quarterly premium then the next premium would have been due in June 89. Therefore in either case the death of the policyholder having been accepted as 1405-89 the policy could not have said to be lapsed. HELD: The appeal of LIC was dismissed and the entire amount along the bonus, interest etc. be paid to the complainant.

Case Study - Court ordered LIC to pay Rs 5 lakh

The District Consumer Disputes Redressal Forum has directed Life Insurance Corporation (LIC) to pay Rs 5 lakh to a resident of village Manela here after finding deficiency of service on its part. Complainant Pawan Kumar in his complaint said he got his minor son Udesh Partap Singh insured with the LIC on August 4, 2010 for Rs 5 lakh and deposited Rs 15,494 with the LIC as the first premium. As per terms and condition of the policy, the amount was to be realised either on the date of maturity of the policy (August 4, 2030 or on the death of the person insured, whichever occurs earlier). At the time of purchase of the policy, the son of Pawan Kumar was not suffering from any disease and was hale and hearty. But unfortunately, Udesh died on August 7, 2010 and the complainant requested the LIC to release the insured amount but the LIC tried to put off the matter on one pretext or the other, complainant alleged. The LIC in its reply admitted that the policy was issued on non-medical scheme and the complainant never informed of the death of his minor son. The LIC also denied that the complainant it to release the amount of insurance. The Forum observed deficiency of service on the part of LIC and it is liable to pay Rs 5 lakh to the complainant from August 7, 2010 till its realisation with interest at the rate of 9

per cent per annum. It also directed the LIC to give Rs 5 lakh as litigation charges to the complainant within one month of receiving of the order.

Consumer panel tells insurance because to pay claims in 2 separate cases

In two separate orders, the Punjab Consumer Disputes Redressal Commission has held that insurance claim of a person cannot be turned down solely on the grounds that the person suffered from diabetes or rheumatic heart disease. The first case pertains to Mitter Pal Aggarwal, a resident of Jalandhar district, who had taken a policy from the Life Insurance Corporation (LIC) for Rs 1 lakh in January 2002. He had diabetes mellitus and he died in September the same year. In the second case, Kewal Krishan, a resident of Batala, had taken an insurance policy from National Insurance Company in 1999 for Rs 5 lakh. It was renewed in 2000, and the claim was reduced to Rs 4 lakh. In 2001, he died of kidney failure. After the death of both these people, their insurance claims were refused by the respective companies on the grounds that they were suffering from diabetes. The stand taken by the companies was not accepted by the commission. The insurance claim of Aggarwals family was upheld on the ground that the insured was not suffering from diabetes mellitus at the time of taking the policy. Similarly, the insurance claim of the heirs of Kewal Krishan was upheld on the ground that he was not suffering from kidney failure when he took the policy. Commission President Justice S N Aggarwal and members Lt Col Darshan Singh and Amarpreet Sharma relied upon the judgment of the Supreme Court that if a

person is suffering from hypertension or diabetes, the insurance claim of the legal heirs could not be repudiated on the ground that the person had suppressed this information from the company. The Supreme Court had observed that hypertension or diabetes were not fatal in themselves. If a proper check was maintained, a person suffering from either of these problems could live a long and healthy life. In this light, the commission directed the companies to pay the insurance claim to the legal heirs of the insured persons, with interest from the date on which it was to be paid.

Case Study - Supreme Court directs LIC to pay compensation for issuing wrong policy
A bench of the Supreme Court of India in its judgement has asked the country's premier life insurer, the Life Insurance Corporation (LIC) of India Ltd to pay some compensation to widow of Kamal Singh for issuing wrong policy. Late Kamal Singh had deposited Rs 2.6 million in a proposal for LIC's New Jeevan Akshay 1 policy, but mistakenly he was given New Jeevan Dhara policy. Though, he got some monthly pension under the former insurance scheme without verifying the policy he got. Usha Kumari, his widow, approached the Rajasthan consumer commission which directed the LIC to payback amount with interest after deducting some payments. Interestingly, the national commission had rejected it. Finally when the case 'Usha Kumari vs LIC' was filed in the SC, the honorable court observed that the LIC is guilty of issuing wrong policy due to lack of due diligence in its dealings. The SC rejected the national commission's observation and asked the

insurer to pay Usha Kumari balance of the premium deposited by the insured and lump sum compensation..