Meenakshi Sharma vs Life Insurance Corporation of India

WIFE of the insured filed Complaint Case No. 307/2003 before the District Consumer Disputes Redressal Forum, Bhopal, for recovery of the sum payable under two insurance policies as her husband has expired on 2.5.96 and she was the nominee. The sum assured under the first policy No. 350793584 was Rs. 50,000 and for the second policy No. 350791501 the sum assured was for Rs. 47,000. The District Forum found that first policy has lapsed for non-payment of premium on due date. Finally, the District Forum held as under : "(1) That the opposite party is directed that it shall make payment of the premium amount deposited in insurance policy No. 350793584 as per the prevalent rules and in accordance with the conditions of the insurance policy. (2) The opposite party is also directed that it shall make payment of the insured amount of Rs. 47,000 in regard to the policy No. 350791501 and on that shall make payment of interest @ 6% p.a. from 19.5.2003, the date of presentation of the complaint till payment. (3) The opposite party shall make payment of Rs. 500 as costs of the case to the complainant."

AGAINST that order, the LIC preferred Appeal No. 734/2004 and complainant also preferred Appeal No. 749/2004. By a common order dated 25.1.2005 the appeal filed by the LIC was dismissed. The appeal filed by the complainant was partly allowed and the LIC was directed to pay in addition, the accrued bonuses over and above the sum assured on the said policy dated 15.2.1994. Against the order passed by the State Commission in the appeal filed by the complainant, the complainant has preferred this revision petition.

In the revision application, complainant has contended that the order passed by the State Commission directing to pay the amount with interest @ 6% is absolutely inadequate as at the relevant time i.e. in the years 1994 1996 prevailing rate of interest was much more higher. It is also contended that LIC is a nationalised company to protect the interests of the insured and not to litigate unnecessarily.

IN our view, the submission made by the learned Counsel for the complainant requires to be accepted and the order passed by the State Commission directing the LIC to pay the sum assured with interest at the rate of 6% p.a. requires modification. The LIC is, therefore, directed to pay the said amount with interest @ 10% per annum from 15.8.1996 (that is to say six months after the death of the insured) till its payment. Second submission of the petitioner also requires acceptance. Petitioner was unnecessarily required to approach the District Forum, State Commission and the National Commission. For this litigation, harassment and mental agony, she is required to be adequately compensated.

IN this view of the matter we direct that LIC shall pay Rs. 10,000 as compensation including the costs to the complainant after adjusting the amount paid to the complainant. In the result, the revision petition is allowed. The Insurance Company is directed to pay the sum assured with interest at the rate of 10% p.a. from 15.8.1996 till its payment. The Insurance Company shall also pay Rs. 10,000 as compensation. Revision allowed.