LIFE INSURANCE CORPORATION OF INDIA & ORS Vs. SITA RAM & ORS
UTTAR PRADESH STATE CONSUMER DISPUTES REDRESSAL COMMISSION
Life Insurance Corporation Of India And Ors
Sita Ram And Ors
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(1.) HEARD Mr. Vineet Srivastava, learned Counsel for the appellants.
(2.) NONE responds on behalf of respondents although objections on their behalf have been filed by Mr. Raj Kumar Singh, Advocate and Mr. Ajai Tewari, Advocate.
(3.) THE crucial question which arises for determination before this Commission is as follows:
"Whether the legal heirs of an insured who were not nominated by the insured deceased can claim the insured amount in spite of the fact that the policy had lapsed during the lifetime of the insured deceased -
Before we reply to the question framed above, it would be relevant to note that the policy holder Mr. Vijai Bahadur Verma got his life insured by means of policy No. 280650943 for a sum of Rs. 25,000. This policy was taken by the deceased on 16.11.1990 which came into effect w.e.f. 28.11.1990. Mr. Vijai Bahadur Verma merely deposited two six monthly instalments before he, unfortunately, met with an accident on January, 27, 1992 and died the same day. While contracting the policy he had nominated his wife Mrs. Asha Devi as the legal heir, who was authorised to claim the insured amount in case of his untimely death. Mrs. Asha Devi remarried in May 1992 and started living with her second husband leaving behind her two daughters with her parents in law. When Mrs. Asha Devi made an attempt to deposit one instalment of premium the LIC declined the offer as the policy had already lapsed on account of default in payment of the third instalment due in November 1991. Mr. Vijai Bahadur was alive in November 1991 but he did not deposit the instalment well in time including the grace period of thirty days. The result was that the policy lapsed in the later half of December 1991.
According to the terms and conditions of the policy once the policy lapses, neither the nominee nor any one else including the insured (in case of his being alive) can claim the amount of the policy. The only exception for disbursement of the amount which has been factually paid is that if a period of three years passes with all instalments being paid in time, the only amount which has been received by the Insurance Company is refundable to the authorised person. In the case in hand the said period of probation has not fulfilled the condition of the exception clause and, therefore, even that provision will not be attraced to the case in hand.;
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