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Udupi : The Consumer Court of Chikkamagalur District grants justice to policy holders of LIC, Udupi Region wherein crores of premium amounts were embezzled by its agents. Meanwhile, Chikkamagalur Police headed by Mr. Annamalai have arrested LIC agent Mr. Devaraj and has sent him to judicial custody. Another accused Ms Shobha Rani has obtained an anticipatory bail, said Dr. Ravindranath Shanbhag, President, Human Rights Protection Foundation, Udupi.

He was speaking to media persons during the press meet held at Vaikunta Baliga Law College, Kunjbettu here on Thursday, 16^th November, Ravindranath Shanbhag said that some time around June-July 2016, some people of Kadur in Chickmagalur district in Karnataka who had taken life insurance from LIC, under the Jeevan Madhura Micro Insurance Scheme approached Human Rights Protection Foundation, Udupi for assistance in the solution of their problem with the LIC. Our enquiries during a visit of the undersigned to Kadur, and personal discussions with the Sub Agents and Policy holders and members of general public brought out the various information.

He said that we observed that thousands of MI policy holders were dropped from the scheme by LIC, allegedly for not paying premium. In most of the lapsed policies, as per your records, only one or two instalments of premium were paid to LIC and some claims were also rejected for the same reason. Surprizingly, we found that every policy holder, whose policy was lapsed, had receipts for his payments of premium for all these years. Further all these receipts carried LIC’s official logo as well.

During the discussions with some LIC officials we apprised them of the sad plight of your MI sub agents and the policyholders. The NGOs NGOs namely M/s Samanvaya Health, Education and Rural Development Society, Tiptur, Sri Mukkanneswari Yuvathimandali, Arasikere and Shubhodaya Health and Rural Development Society, Chikkamagalore, were the MI agents appointed by LIC, these MI agents appointed sub-agents with your approval.

These NIC’s collected lakhs of rupees from MI policy holders through their subagents, Prima facie, it has come to our notice that the SPs by and large collected the premium, recording the same in the register as specified in the “Deed of Agreement”. The SPs had handed over the cash as well as DDs, from time to time, to the respective MI agents as per the procedure prescribed by LIC.

All was going on well till some MI claims were rejected on the ground that the policies had lapsed due to nonpayment of premium. This came as shock to the poor but sincere policy holders and equally sincere SPs. As per our investigations, the cash handed over to the MI agent by SPs were not transmitted further to the LIC and DDs were adjusted to some other policies defrauding the policyholders, SPs and LIC as well.

Most of the policy holders were illiterate, innocent villagers and believed that SPs pocketed the amount paid by them towards MI premium. The SPs were mostly Anganwadi Teachers and Agriculture labourers were not in the position to show their faces to the public, from the fear of being manhandled and beaten by the irate mobs. Most of these SPs were forcibly made to refund the amount to policy holders to the tune of Rs. One to Three lakhs, in order to remain in the villages. Some SPs have taken loan from private banks and pawn brokers by pledging their jewellery to pay off policy holders. Some have even sold small pieces of land they owned. This has driven most of them to disappointment and disgust in life due to the financial crunch.

It is unfortunate that the MI policyholders have lost their faith in LIC. They are disappointed that neither the agents nor the LIC came to their rescue when they were in trouble. At any cost this faith has to be restored for which we promise our full support.

We learn that some FIRs were filed in police stations at Arasikere and Chickmagaluru. We are of the firm opinion that the MI agents have defamed LIC and cheated MI policy holders at least to the extent of several lakhs of Rupees in Mysore division.

Though we are certain that the LIC is not involved in the fraud, we feel that after launching the schemes, some where it has lacked in the duty of supervising and monitoring its agents. This system failure has lead to such a big fraud.

HRPF observed that many of the defrauded poor anganawadi teachers are psychologically depressed and may and up in committing suicide. If any one of them takes up such a recourse then it may go viral and result in a greater disaster affecting the better earned fame and image of LIC. At any cost people’s faith in this great national institution should not be lost. Therefore, without wasting any time, please take up the matter with the higher management at the central office level. HRPF, as a public interest organization, offer our whole hearted support in resolving this issue.

After scrutinizing all documents it was found that the agencies were appointed without any background checks. For three years, these agents had not paid the premium paid by the policy holdiers and LIC had not taken any action against them.

With these two main points in mind the case was filed at the Consumer Court, Chikkamagalur District. After 16 months of proceedings, the court passed the order in favour of the policy holders and ordered LIC to pay the policy holders Rs. 3,000 each as compensation and Rs 1000 each as Court costs, within one month from the date of order.

25 days have elapsed since the court passed its order but LIC has not paid the policy holders. Now the policy holders have written to Prime Minister Narendra Modi and Finance Minister Arun Jaitley to direct LIC to follow the Court Order. The Foundation implores with LIC not to delay delivery of justice by filing an appeal against this court order