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Una Consumer Forum Orders Reliance Nippon Life Insurance to Refund ₹95,000 with Interest for Deficiency in Service

The District Consumer Disputes Redressal Commission, Una, Himachal Pradesh, on August 5, 2023, ruled in favor of Manga Ram Verma, directing Reliance Nippon Life Insurance Company Ltd. to refund ₹95,000 along with 9% interest per annum for failing to provide policy documents. The commission also awarded ₹30,000 as compensation for mental agony and ₹20,000 for litigation costs.

Case Background

The complainant, Manga Ram Verma, a resident of Solan district, purchased an insurance policy from Reliance Nippon Life Insurance Company Ltd. on February 19, 2020, after being approached by an agent at the company’s Amb branch. He paid ₹95,000 as the first installment via cheque, with the assurance that policy documents would be delivered within 15-20 days.

Despite repeated follow-ups, the complainant did not receive the policy documents. Frustrated with the delay, he issued a cancellation request on August 29, 2020, seeking a refund. However, the company neither refunded the amount nor provided a satisfactory response, prompting the complainant to file a case citing deficiency in service.

Arguments by the Complainant

1. Policy Not Delivered: The complainant asserted that the policy documents were not provided despite multiple visits to the company's branch.
2. Cancellation Request Ignored: A written cancellation request (dated August 29, 2020) was ignored for months, causing further distress.
3. Deficiency in Service: The failure to deliver policy documents constituted negligence and unfair trade practices.

Defense by Reliance Nippon Life Insurance

1. Policy Issued Electronically: The company claimed the policy documents were sent via email on May 21, 2020, and through WhatsApp on May 22, 2020, and June 3, 2020 due to COVID-19 lockdowns.
2. Free Look Period: The company argued that the complainant failed to cancel the policy within the 15-day Free Look Period allowed for reviewing terms and conditions.
3. Delay in Cancellation Request: They contended that the complainant’s cancellation request (dated August 29, 2020) was beyond the permissible timeframe, making a refund invalid.

Commission’s Findings

The forum, presided over by D.R. Thakur and Keshav Chandel, rejected the company’s defense, citing the following:

Failure to Prove Delivery of Policy Documents:

• The company did not provide conclusive evidence (e.g., acknowledgment or RAD receipts) proving the complainant received the policy documents via email or WhatsApp.
• The complainant’s affidavit stated that no documents were received, and his multiple visits to the company corroborated this claim.

Delayed Response to Cancellation Request:

• The company’s reply to the cancellation request, sent on December 25, 2020, was unreasonably delayed (nearly four months after the request).
• This delay further demonstrated negligence on the part of the insurance provider.

Deficiency in Service:

• The company’s inability to deliver the policy or process the cancellation in a timely manner constituted deficiency in service.
• The complainant suffered undue mental tension and harassment due to the company’s inaction.

Judgment

The commission ruled in favor of the complainant and directed Reliance Nippon Life Insurance to:

1. Refund ₹95,000: The amount paid as the first installment, along with 9% interest per annum from the date of complaint filing until realization.
2. Pay Compensation: ₹30,000 for mental agony and harassment caused to the complainant.
3. Cover Litigation Costs: ₹20,000 towards legal expenses.

The company was given 30 days to comply with the order, failing which the complainant could initiate execution proceedings.

Significance of the Ruling

This case underscores the accountability of insurance companies to uphold their commitments to policyholders. The judgment highlights the necessity of transparent communication and timely delivery of policy documents. It also reaffirms that consumer forums remain a critical recourse for individuals seeking redress for deficiencies in service.