📖 Brief Case Facts
In a case that underscores consumer rights against deceptive practices, the National Consumer Disputes Redressal Commission (NCDRC) has ruled in favor of Gyan Prakash Singh, a retired government employee, and his family. The family had invested ₹2.47 lakh in five insurance policies from Tata AIA Life Insurance after an agent promised them that these were one-time premium policies with attractive returns.
However, shortly after receiving the policies in 2009, the family discovered they had been misled. The policies required annual premiums for 10 years—something the family, with their limited financial resources, could not afford. Shocked and disappointed, they immediately reached out to Tata AIA, seeking a refund. But the company rejected their request, citing the freelook period—a brief 15-day window to cancel policies—as having lapsed. This led the family to approach consumer courts in search of justice.
🧾 What the Family Claimed
Gyan Prakash Singh and his family told the courts that they were deliberately misled by Tata AIA’s agent, who made false promises about the policies being a one-time investment. They argued that they had no intention of signing up for long-term premium payments, especially given their modest financial background.
When they discovered the truth, they immediately raised concerns with the company. But despite their timely objections, Tata AIA refused to refund the amount, offering only 1/5th of the premium paid. The family felt cheated and accused Tata AIA of unfair practices, demanding the full refund along with compensation for the stress and inconvenience caused.
🏢 What Tata AIA Argued
Tata AIA Life Insurance defended its actions, stating that the policies were issued as per the agreed terms and that the family failed to act during the freelook period. The company also argued that the family’s complaint was filed too late, as it was lodged in 2013—four years after the policies were issued.
Tata AIA further claimed that their absence during the initial hearings in the lower courts should not lead to an ex-parte decision against them. They insisted that their actions were in line with the policy terms and legal requirements.
🔍 Observations by NCDRC
The NCDRC, India’s top consumer dispute redressal body, carefully examined the evidence and upheld the earlier rulings of the District and State Consumer Forums. The commission noted that the agent had misrepresented the policies as one-time premium schemes, misleading the family into purchasing them.
The NCDRC dismissed Tata AIA’s reliance on the freelook period, emphasizing that the family had never been fully informed of the actual policy terms when they agreed to invest. It stated that freelook provisions cannot protect insurers when misrepresentation is evident. The commission also rejected the argument that the complaint was time-barred, clarifying that the family had acted within the permissible time after Tata AIA issued a partial refund in 2012.
While the NCDRC upheld the decision to refund the entire premium with interest, it removed the compensation for mental harassment, following a Supreme Court precedent that prohibits multiple awards for the same issue.
⚖️ Final Judgment and Conclusion
In its final ruling, the NCDRC dismissed Tata AIA’s revision petition, ordering the company to refund ₹2.47 lakh to Gyan Prakash Singh and his family, along with 9% annual interest. The family was also awarded ₹5,000 for litigation costs.
This judgment is a reminder to all insurers about the importance of transparency and honesty in their dealings with policyholders. It also reinforces the accountability of companies for the actions of their agents, ensuring that consumers are protected against such practices.
Same happened with me, by Bharti AXA life insurance
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