Month's grace period for paying insurance premium can be 31 days: NCDRC

The one-month grace period for payment of insurance premium can be 31 days as well, the apex consumer forum has held while directing the LIC to pay over Rs 4 lakh to a widow for rejecting her claim for the insured amount on her husband's death.

The LIC had rejected the widow's claim on the ground that the policy had lapsed due to non-payment of the insurance premium, which was due the month before her husband's death.

The National Consumer Disputes Redressal Commission (NCDRC) dismissed the plea of the Life Insurance Corporation (LIC) of India, which had given a grace period of 30 days for payment of the quarterly premium of Rs 3,108.

"The grace period for payment of the premium has to be taken as 31 days, i.e., upto December 23, 2008 in which event the insurance policy was valid and subsisting at the time and date of death of the life assured and the sum assured would, therefore, be payable after adjusting the unpaid premium," the commission said referring to its own ruling in a similar case.

"As a result, the revision petition is dismissed. The petitioner is directed to remit the payment of Rs 3,96,892 and cost of Rs 10,000 to the respondent/complainant within six weeks of the date of this order," the bench presided by Member Anupam Dasgupta said.

The NCDRC order came on the LIC's plea challenging a decision of the West Bengal State Consumer Disputes Redressal Commission which had dismissed its appeal against the March 2010 order of the Birbhum District Consumer Disputes Redressal Forum.

The district forum had directed the LIC to pay the sum of Rs 3,96,892 to the widow, after deducting the unpaid premium amount of Rs 3,108.

The widow, Rupali Mondal, in her complaint had alleged that LIC had rejected her claim, after her husband died in an accident on December 23, 2008, merely because the quarterly premium due on November 22, 2008 was unpaid.

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