High Court
Case Details
WP(C) 659/2013 BEFORE THE HON’BLE MR. JUSTICE UJJAL BHUYAN Judgment & Order (Oral) Heard Mr. R Islam, learned counsel for the petitioner and Mr. P Bhowmick, learne d counsel for respondent Nos. 1 & 2. Also heard Mr. S Chouhan, learned counsel f or respondent No. 3. By way of this petition, under Article 226 of the Constitution o 02. f India, petitioner seeks quashing of intimation dated 16.02.2012 of the Senior Branch Manager, Life Insurance Corporation of India (LICI), GBO-1, Guwahati, inf orming the petitioner that the insurance policy of her deceased husband had laps ed and, therefore, she is not entitled to any payment as well as the order dated 30.11.2012 of the Insurance Ombudsman, declining to interfere with the above de cision of the insurance company. 03. Case of the petitioner is that her late husband, Bijoy Das had s ubscribed to a life insurance policy called ’Anmol Jeevan-1’ from LICI for a sum assured of Rs.8,00,000.00. Petitioner’s husband subscribed to the policy throug h respondent No.3, who is an agent of LICI.
Legal Reasoning
The policy was numbered as Policy No. 484948969 with date of com 04. mencement on 05.09.2009. According to the petitioner, her husband paid the first premium of Rs. 1,116.00 in September, 2009; second premium was paid on 20.03.20 10 and the third premium was paid on 30.09.2010. Next premium due was on 05.03.2 011. 05. Unfortunately, husband of the petitioner died on 25.03.2011 befo re paying the insurance premium, which was due to be paid in the month of March, 2011. 06. When the petitioner lodged a claim before the LICI, the same was rejected vide the impugned intimation dated 16.02.2012. She then lodged a compl aint before the Insurance Ombudsman, Guwahati. By order dated 30.11.2012, the In surance Ombudsman rejected the complaint of the petitioner. 07. Aggrieved, petitioner has filed the present writ petition challe nging repudiation of her insurance claim and for a direction to the respondents to pay the sum assured with applicable interest. 08. Respondent Nos. 1 & 2 in their common affidavit have stated that the insurance policy was in lapsed condition on the date of death of the life a ssured i.e. the husband of petitioner. The unpaid premium was due on 05.03.2011. As per Clause II of the Policy Schedule, which formed part of the policy terms and conditions, a grace period of 15 days was allowed for payment of premium. If the death occurs within this grace period and before payment of the premium due , the policy would be construed as valid and the sum assured would be paid after making the prescribed deductions. If the premium is not paid during the grace p eriod and the grace period expires, the policy lapses. In the present case, prem ium fell due on 05.03.2011. By taking into account the grace period of 15 days, the policy holder had the option to pay the premium within 20.03.2011. While the premium was not paid even during the grace period, the policy holder died on 25 .03.2011 i.e. after the grace period was over. Thus, the policy was in lapsed co ndition on the date of death. Accordingly, no payment was due to the petitioner on account of the above policy. 09. In her reply-affidavit, petitioner has stated that respondent No .3 did not deliver/handover the policy to the life assured during his life time. He kept the policy which he received from LICI with him and did not hand over t he same to her husband. Consequently, the husband did not know about the availab ility of only 15 days grace period for payment of the premium. He was under the impression that since the previous premium receipt indicated that the next premi um was due on 03/2011, the entire month of March was available for payment of th e premium. In such circumstances, repudiation of the claim of the petitioner on the ground that the policy had lapsed, is not justified.
Legal Reasoning
10. Mr. Islam, learned counsel for the petitioner submits that consi dering the beneficial objective of the insurance law under which LICI operates, a liberal approach is required to be taken while dealing with a case of insuranc e claim. He submits that the facts as narrated above, reveals a hard case and re pudiation of the insurance claim on the ground that the life assured did not pay the premium within 20.03.2011 while he died on 25.03.2011, is very unfair and u