KALI (CEO) 24 March 2013

Pre closure of metlife policy

I took a life cover policy with Metlife. The SI is 50000 and the premium is 7500/ semi annually. I have paid prm for three years in full ie Rs.45000/. The last premium was due on 19/11/2012 and unfortunately I did not/could not paid that amount.

Suddenly I received a cheque from the Insurer stating that they have closed the policy and refunded only Rs. 21235/ . I was not given any notice for this preclosure nor I was given any reminder for the unpaid prm. When contacted thro mail, they quote a policy condition and the calculation table.

This is with reference to your e-mail, regarding above mentioned policy number. We would like to inform you that as per terms and condition of the policy at any point of the time, if surrender value of the policy had become less than the annualized premium, the policy was foreclosed. Please find below calculation for your reference.

The actual prm I paid was 45000/ and the refund they offer is only 21235/. This is arbitrary without intimating about the pre closure condition.

The calculation of the account value and then the surrender is a mystery. It looks as if they were waiting for this preclosure.

Now my question is can I proceed against them legally?

What are my chances of getting higher refund or a reinstatement of the policy?

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2 Replies

Kumar Doab (FIN) 24 March 2013

Apparently it is a ULIP.

You have posted that:

--“the premium is 7500/ semi annually.” i.e 15000/pa.

“if surrender value of the policy had become less than the annualized premium,”

“Please find below calculation for your reference.”

As per calculations provided by the company did the surrender value become less than annualized premium i.e 15000/pa,”

If yes how come the company has refunded Rs. 21235/?

If you are interested to keep the policy in force you may return the cheque to company and tender due premium.

You may also obtain the charge statement showing charges levied every month, form date of inception of the policy till date…….

The company has been supplying you emails, implying it has your email, phone number…..

Did the Private Life Insurance Company supply you any notice by effective mode of communication (email, redg/speed post) within 15 days from expiry of Grace period……. In compliance with

Insurance Regulatory Development Authority (Treatment of Linked Insurance Policies) 2010:

Published in THE GAZETTE OF INDIA: EXTRAORDINARY

Obligation of the Insurer for revival of the policy:

You may also go thru:

-INSURANCE REGULATORY AND DEVELOPMENT AUTHORITY (Standardization of terms &

conditions of ULIP Products and treatment of lapsed policies) REGULATIONS, 2010

-Life Insurance handbook

-Regulation of Protection of Policy Holder’s Interest……..

Metlife has been penalized by IRDA in the past.

“Decision:

Having regard to the facts of the case, the IRDA is satisfied that there has been negligence on the part of the insurer and consequently imposes a penalty of Rs. 2 (Two) lakhs under Section 102(b) of the Insurance Act, 1938”

Decision of IRDA on all companies is maintained at IRDA website.’

Attached File : 779180528 standardization ulip lapsed policies.pdf, 779180528 surrender charges discontinued policy.pdf, 779180528 life insurance handbook.pdf downloaded: 127 times