Delhi Forum Orders LIC And MCD To Pay Rs 4.8 Lakh To Deceased Karmachari's Family

The central Delhi consumer disputes redressal forum has directed the Life Insurance Corporation and Municipal Corporation of Delhi to pay a claim amount of Rs 4.8 lakh to the wife and daughter of a deceased cleaning staff of the civic body, along with a compensation of Rs 40,000, for causing them sufferings, harassment and mental agony.

Rejecting the LIC's argument that the policies had lapsed, the forum also observed that the contract to deduct the premium amount from the salary and then remit it to the insurer was between the MCD and the LIC and the employee was unaware of the non-deduction of the said amount.

The forum comprising President Inder Jeet Singh and member Rashmi Bansal was hearing a complaint filed by the wife and daughter of a deceased safai karamchari, who alleged deficiency in service by the LIC for rejecting their claims.

In an order dated Oct.14, the forum noted that the employee, appointed in the Karol Bagh zone in May 2005, had opted for the Salary Saving Scheme offered by the LIC to MCD employees, and his wife and daughter were declared nominees for Rs 1.6 lakh and Rs 3.2 lakh respectively.

It noted that according to the scheme, the monthly premium deduction was to be made from his salary by the civic body and then remitted to the LIC. But the premiums for two of the policies were not paid for three months and four months during the insured's lifetime because of which they lapsed.

After the employee died on Oct. 13, 2016, the wife and the daughter filed the claims which were rejected, the forum observed.

Taking note of the evidence before it, the forum said, "None of the documents shows that deceased life assured (DLA or the employee) was conveyed about the lapse of the policies or that he had knowledge of the non-payment of the premium amount and it was the responsibility of the opposite party or OP1 (LIC) to intimate the life assured the resultant consequence for such non-deposit. But neither OP1 nor opposite party 2 (MCD) had provided appropriate information to him at any point of time." It said if the fact of non-payment of premiums was brought to the employee's attention, he could have taken steps to ensure that the policies did not lapse.

"Even the date of lapse of the policies was not declared by OP1.... Further, OP1's contention is that the surrender value of the policy was paid to the complainants, but no such detail or document of payment is proved," the forum said.

It added that the contract to deduct the requisite premiums and then remit the amount was between the LIC and the MCD and the employee was unaware about the working of the scheme.

"It is the entire responsibility of the LIC to raise the demand and the MCD to pay for the same. Therefore, it is not permissible on the part of the opposite parties to deny the benefits of the two policies to the nominees," the forum said.

It said as both parties 'failed in their duty' to inform the employee about the consequences of non-receipt of the premium, he or his family cannot be made to suffer for the default.

"Accordingly, the complaint is allowed. OP1 and OP2 are held liable, jointly and severally, to pay the claimed amount (of Rs 1.6 lakh to the wife and Rs 3.2 lakh to the daughter)," the commission said.

It also directed the LIC and MCD to pay Rs 40,000 as "compensation for their sufferings, harassment and mental agony" and Rs 20,000 as litigation expenses.