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Andhra Pradesh - Visakhapatnam Printer Friendly Page   Send this Article to a Friend

LIC asked to pay policy amount to consumer

By B. Prabhakara Sarma

VISAKHAPATNAM: The Life Insurance Corporation (LIC) of India has been directed by the Visakhapatnam District Consumer Forum to pay the policy amount to a consumer along with costs.

According to the case record, an employee of the Visakhapatnam Municipal Corporation (VMC), Surisetti Suryanarayana of Isukathota in the city took four insurance policies from the LIC. While three policies were cleared and amounts paid after maturity, the first policy for Rs. 3,000, which commenced from 1969, was not cleared. In fact, the policy was under salary savings scheme and paid by the employer, VMC, and even an excess amount of Rs. 869.76 was received by the LIC. This prompted the consumer to file a complaint (Consumer Dispute No: 113/2003) against the Personnel Divisional Manager in the city and the Branch Manager of Seethammadhara branch of the LIC seeking a direction to pay the policy amount of Rs.3,000 along with bonus, interest, compensation and costs, besides repayment of the excess amount delivered.

The opposite party (OP) said that the first policy was in lapsed condition for non-payment of monthly premium as the consumer failed to pay any premium even from the date of commencement of the policy. It was the duty of the consumer to pay the premium and having failed to do so, he did not have the right to claim any policy amount, it argued.

Judgment

The forum president, C. Rambabu, and its members -- D. Suseela and G. Viswanatha Reddy -- in their judgment, said that they were not inclined to accept the plea of the OP in the light of the evidence. In fact, a lot of correspondence transpired since 1992 but the claim was not settled. An endorsement by the employer in 1993 read that the first policy had matured and also advised the consumer to contact the LIC to get back the excess premium paid, they observed.

``Though OP contends the policy is lapsed it has not been able to place any material to accept the plea. It wanted to rely on the non-filing of salary reduction by the consumer. We feel it is not necessary because the consumer has been able to establish payment of the first premium and the OP issuing the policy,'' the forum noted.

Service deficiency

The forum said the retention of matured amount along with excess payment amount to keeping money as trustee by the OP. The forum directed the LIC to pay the policy amount of Rs.3,000, and repay the excess premium with 9 per cent interest from January 1, 1995, till the date of realisation, in two months. It also awarded Rs.1,000 towards costs. However, the forum did not allow interest on the bonus amount due to abnormal delay on the part of the consumer.

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