Maturity Claim - Gbic.co.in

complainant raised the present complaint against LIC about the huge amount ofRs.74890 recovered as interest on compound basis. He claimed that LIC was at fault innot intimating him about the loan and interest outstanding against the policy. Hecontended that even though there was a provision to show details of loan in thepremium notices, LIC never indicated any loan details in the notices sent to him and heforgot about the loan. He contended that it is highly irregular for LIC to levy such ahuge amount as compound interest without ever reminding him. He requested forcharging of simple interest on the loan and not compound interest as LIC was at faultin not reminding him about loan.The insurer contended that the LA executed a loan bond and he was given the loancheque under a covering letter. As per the loan sanction letter dated 29.7.1988, the LAwas advised to pay half yearly interest @ Rs.771.80 regularly and he was also advisedabout the broken period interest of Rs.257.30 payable on 28.9.1988. They contendedthat the LA did not pay even the broken period interest and they are justified inrecovering the total interest as per loan agreement.DECISIONThe LA admitted that he availed the loan in 07/1988 and forgotten about the same. Hismain complaint is that he was not reminded by LIC till the policy matured and he neverknew that he would be asked to pay such a huge amount as interest. During the courseof personal hearing held on 14.2.2007, the LA admitted that he requested for transferof his file to Bangalore and LIC acted accordingly. As per record the LA stayed atKolkata for about eight years after sanction of loan and he did not pay even a singlerupee towards the loan account. Hence, shifting of residence is not the immediatereason for non-payment of interest. Further, the insurer contended that there is nodiscretion to waive any part of interest, even in the case of their regular employees insimilar situations. In view of the clear terms of loan agreement, the complaint wasdismissed.Kolkata Ombudsman CentreCase No. : 167/24/001/L/06/2006-07Shri Baban PrasadVsLife Insurance Corporation of IndiaAward Dated : 28.11.2006Facts & Submissions:The complainant, Shri Baban Prasad purchased the above LIC policy, which gotmatured on 07.11.05. He stated that even after surrender of the policy bond anddischarge form on 25.11.05, he did not receive the maturity amount till date. Hence,this complaint was filed before this forum seeking relief for the maturity amount plusinterest thereon.However, before the order could be passed, the complainant sent a letter dated18.11.06 stating that he would like to withdraw the above complaint against theinsurance company. He further stated that he would take appropriate steps against theinsurance company and he prayed for withdrawal of the complaint.As the complainant had requested for withdrawal of the complaint, the same wasdismissed as per his request.Kolkata Ombudsman CentreCase No. : 429/24/001/L/09/06-07