Page 9 - Insurance Times December 2019

LIC of India

News

Bids invited by LIC for Consumer Commission asks LIC to pay Rs 9.3 lakh to
stake sale in unlisted policyholder’s widow
The LIC has recently been asked by the apex consumer commission to pay Rs
company 9.3 lakh to the widow of a policyholder for repudiating their claims in the con-
Bids have been invited by LIC from text of concealing information about a previous treatment and hospitalisation.
merchant
LIC’s review petition has been dismissed by the National Consumer Disputes
bankers for Redressal Commission (NCDRC) while it upheld the Wardha district consumer
the pur- forum's order directing to pay the claim amount to Ratna, wife of deceased
pose of dis- Digambarrao Thakre. LIC had refused to pay two of Thakre's claims in 2003,
investment saying he had suppressed information about treatment undergone for asthma
of its “stake in equity shares of an prior to taking the policy.
identified unlisted company through
However, the commission mentioned that there was no evidence that Thakre
a transparent bidding process”.
was suffering with any disease on the day the policies were issued to him and
According to the sources, while LIC said that even if Thakre had such an illness earlier, he was healthy at the time
did not disclose the name of the when LIC had issued him the policies, therefore the contract cannot be viti-
“unlisted company” in an advertise- ated on the grounds of suppression of facts.
ment, the company is likely to be "A contract of this nature cannot be termed bad and be terminated on ground of
UTI Mutual Fund. having obtained by fraud or can be declared as vitiated on facts which were not in
existence on the day of contract," NCDRC presiding member Deepa Sharma said.
UTI Mutual Fund’s four domestic
shareholders — Life Insurance Cor- LIC gives nod to policyholders to revive their policies
poration, State Bank of India, Punjab
LIC has permitted its policyholders to revive their policies which have been
National Bank and Bank of Baroda
lapsed of over 2 years, in a bid to help improve persistency ratio. In an official
— hold around 18.5% stake each. statement, LIC further said that the policies that have lapsed for more than
The four stakeholders also have two years and were not allowed to be revived earlier can also be revived now.
their own asset management com- After the IRDAI Product Regulation 2013, which came into effect from January
panies (AMCs). 1, 2014, revival period was restricted to two consecutive years from the date
of first unpaid premium, during which the policyholder is entitled to revive
As the crossholding rules of market
policy which was discontinued due to nonpayment of premium, it said.
regulator Sebi applies to all the four
promoters, they will have to bring With a view to extend the benefit of continued life cover, LIC approached IRDAI
down the stake in UTI Mutual Fund and extended the benefit of longer revival period to even those policyholders
below 10% and give board seats. who bought policies post January 1, 2014, LIC said. Vipin Anand, LIC managing
US-based fund T Rowe Price holds director, said unfortunately, there are circumstances when one is unable to
continue paying premiums and the policy lapses and it always makes a better
the remaining 26 per cent stake in
sense to revive an old policy rather than discontinuing it and buying a new
UTI Mutual Fund.
policy to restore insurance cover.
The Insurance Times, December 2019 9