The District Consumer Disputes Redressal Forum held that the ICICI Prudential Life Insurance Co Ltd ignored the principle of "natural justice" as it was duty bound to inform the complainant (Ashok Kureel) about bouncing of his cheque. "The conduct of insurance company was not in accordance with natural justice.
It should have informed the complainant about the dishonour of the cheque and he should have been called upon to make the payment for renewal of the original policy," the forum said. South Delhi resident, Kureel had alleged in his plea that the ICICI Prudential did not only fail to inform him about the dishonour of cheque, but also converted his life-time pension scheme to 'paid-up' on the ground that he defaulted in payment of second year's premium.
He said that after receiving the cheque for second premium in November 2008, the company had issued him a renewal receipt and a consolidated premium certificate in January 2009 for the period 2008-09.
In its defence, the company said it had duly informed Kureel to renew his policy despite which he failed to do so, and as premium was not paid by the due date, the life cover and rider benefit, if any, available to Kureel ceased as per the terms and conditions of the scheme. The forum observed "the cheque was received by the company in November 2008 and till February 2009 it remained silent and did not inform the complainant".
It directed the company to return Rs 7,00,000, the first premium of the policy, along with Rs 10,000 compensation for causing harassment and Rs 5,000 as litigation charges.