A public interest litigation (PIL) filed by Moneylife Foundation was heard by the Supreme Court on Thursday. The bench of Chief Justice Ranjan Gogoi and Justice Deepak Gupta deferred the matter to 15 July 2019 as per request from senior counsel Arvind Datar, representing Moneylife Foundation.

 

The PIL filed on behalf of thousands policyholders of Jeevan Saral, seeks to have Life Insurance Corporation of India (LIC) and Insurance Regulatory Development Authority (IRDA) to "amend to Jeevan Saral Plan 165 policy maturity to repay all the premium paid along with bank saving rate at 8% per annum to all the existing Policy holders of the Jeevan Saral Policy."

 

The petition also seeks recall of LIC Jeevan Saral by IRDAI. 

 

As highlighted by Moneylife, LIC's Jeevan Saral, which used to be a hot-selling insurance product for agents, until it was withdrawn, is a controversial product. In fact, Jeevan Saral was a traditional product that could make your premium (money paid) disappear! This can happen in many policies during surrender or making it ‘paid-up’, but, in the case of Jeevan Saral, it has happened even at policy maturity. 

 

A senior citizen couple got just one-third of the premiums paid over the years. 

 

The Jeevan Saral product, which has gobbled up hard-earned savings of policyholders (especially senior citizens) have also agitated LIC agents and their association. Despite innumerable letters, protests and objections, LIC has not budged so far. 

 

Moneylife Foundation sent a memorandum to IRDAI on 18 August 2018, pointing out that Jeevan Saral (with profit), a traditional policy, has caused senior citizens to lose as much as 65% to 70% loss of the money invested over 10 years. 

 

From the Memorandum, IRDAI, highlighted four points in its letter to LIC and termed them as being of a 'serious nature'. These are:

 

1. The proposal form did not have any provision to mention the (lower) maturity sum assured; instead it had a provision only for the higher death benefit.

 

2. The maturity benefit was not printed on even the policy documents.

 

3. The agents, as well as some LIC officers were not aware of the plan in general, and the fact that customers may get lesser money than the total premium paid.

 

4. The prospective customers were not informed at the time of sale that the higher insurance coverage provided by the product would lead to poor (negative for those in the higher age group) returns. 

 

Moneylife Foundation also sent copies of the Memorandum to the Finance Minister as well as the insurance regulator. The financial services department in the ministry, which looks after insurance matters, on 28 September 2018, forwarded the Memorandum to IRDAI asking its chairman to take appropriate action. 

 

It has also asked IRDAI to inform the ministry about action taken (on the Memorandum) with regard to the Jeevan Saral policy and inform both, Moneylife Foundation and the ministry. 

 

Moneylife Foundation has received a one-line reply to its memorandum from the LIC chairman VK Sharma, which says, "We appreciate the concerns raised by you in your letter dated 1 October 2018. It will be dutifully looked into."

 

However, there is no further response from either LIC or the insurance regulator, which forced Moneylife Foundation to approach the highest court seeking justice for crores of policyholders.

 

You may also want to read…

 

Jeevan Saral: LIC asked to respond to Moneylife Foundation's Memorandum

 

Will LIC Be Made To Pay for the Horrible Mis-selling of Jeevan Saral?

 

Life Insurance: LIC Jeevan Saral: A Toxic Product

A personal accident policy and a happy family floater policy are usually sufficient for most individuals and families to head out for a holiday. Or that’s what a honeymooner thought. 

 

The following is a case of a person holding all relevant policies but different interpretation of certain clauses by the insurer could have denied him reimbursement. Maintaining all relevant receipts, bills and records probably too came in handy for the insured. 

 

For Hiren B Joshi, a resident of Mira Road, the holiday was also his honeymoon within a fortnight of his marriage on 28 November 2014. He selected Manali in Himachal Pradesh after consulting Heena Tours & Travels. Lakhs of people visit Manali each year for adventure sports including paragliding from India and abroad, newspaper reports say. {https://www.thrillophilia.com/cities/manali/tags/paragliding}

 

The Joshis were part of a group of 100, in which they would go up in the air through a non-motorized, foot launched flying glider with an inflatable wing, which would gradually descend with the help of a parachute. In the case of Mr Joshi, the parachute did not open fully, despite attempts by the pilot. On descent he hit the rocky portion of the surrounding hills and was grievously injured, says a South Mumbai District Consumer Disputes Redressal Forum order dated 1 June 2019. 

 

The paragliding, on 10 December 2014, was being operated by an expert and Mr Joshi had no role in operating it and was no more than what a passenger would be in an airplane.

 

For his injuries, Mr Joshi was admitted the same day to Lady Wellingdon Hospital at Kullu. He was moved to Fortis Hospital at Mohali the next day and was discharged on 6 January 2015. Soon after reaching Mumbai, he was hospitalized again at the Borivali Orthopaedic Clinic from 6 February 2015 to 9 February 2015 and again from 1 April 2015 to 4 April 2015. 

 

“The complainant lodged the claim claiming compensation of Rs6 lakh under the happy floater policy and in support of it he had submitted a duly completed claim form and the original medical and investigation reports, case papers, bills, memos, which was received by the opposite party on 12 January 2015,” said the order by the South Mumbai District Consumer Disputes Redressal Forum. 

 

Happy family floater policy from Oriental Insurance gives a fairly comprehensive cover to a family against illness and injury. For details on Happy Family Floater Policy, please read under -- {https://orientalinsurance.org.in/documents/10182/45621/HFF_Policy_wording/6ad2772c-5efc-4cc9-a46a-b2def73f9493} 

 

Mr Joshi also filed a claim under the personal accident policy issued to him by the insurance company. 

 

Mr Joshi sought Rs6 lakh plus Rs1.28 lakh for the settlement of his claims under the happy family floater policy and personal accident policy and compensation. He also asked the insurance company to pay him Rs60,000 towards payment of fees to a senior advocate.

 

He submitted every single piece of document that could be relevant for the case including brochures given by the travel operator, medical and hospitalisation bills, communications with Raksha TPA, among others.

 

The insurance company rejected his claims on 25 March 2015 and the order was confirmed by the ombudsman on 26 October 2015. One of the key grounds for rejection of his claims by the insurer was Clause 4.19 of the policy.

 

Clause 4.19 of Oriental Insurance Co states “Any treatment arising from Insured’s participation in any hazardous activity including but not limited to scuba diving, motor racing, parachuting, hang gliding, rock or mountain climbing etc. unless specifically agreed by the Insurance Company.”

 

However, Joshi contended that he himself did not indulge in any risky activities, he was not operating any equipment and was just like a passenger being navigated by a trained pilot. 

 

At the Consumer Forum, the insurance company “appeared and filed a written statement through their authorised signatories and the divisional manager Jaysurya Rapaka ,stating that, the complaint is false and bad in law, reliefs prayed for are not maintainable and there is no cause for action and the complaint is time barred, hence dismissed with cost.”

 

“…taking part in paragliding is itself risk, knowing the same complainant has taken the risk and hence the injury cause due to taking such risk is not covered,” the insurer contended.  

 

The insurer could not provide any material evidence to back up the contention that paragliding is a hazardous activity, and that injuries were sustained because of Joshi’s own negligence, Joshi contended. 

 

Mr Joshi’s request to Raksha TPA for cashless facility on 12 December 2014 too had come a cropper, with Raksha replying that as per clause 4.19 the injury has been sustained during a hazardous sport. Raksha assured Joshi that he could seek a review later.

 

The bench finally decided that Joshi is entitled to Rs6 lakh under happy family floater policy, Rs1.28 lakh under personal accident policy, along with 3% interest from the date of filing the complaint. Mr Joshi also got Rs7,000 as compensation for mental agony and Rs3,000 for the proceedings. 

The number of Indians traveling to the United States is expected to hit 1.19 million this year and grow to an estimated 1.41 million by 2022. Many of you reading this may have heard stories of family and friends who have traveled to America without visitors insurance and ended up with huge medical bills, or worse, financial insolvency. America does not have a universal medical system and it is well-known that it has some of the highest medical costs in the world. Traveling for business or personal reasons without adequate visitors travel insurance is a risk not worth taking for yourself and your family.

 

How do I know if I need visitors insurance? 

 

Visitors insurance is always recommended for international travel, but especially for travel to the United States. While the US does not require travel medical insurance for entry, many other countries do. Some countries and regions, like Cuba and the Schengen region of Europe, require certain citizens to have a visitors insurance policy to gain entry. In the Schengen countries, at least 30,000€ of medical travel insurance coverage is required to obtain the Schengen visa. While this may be adequate coverage for a minor illness or injury in the EU, it would be woefully inadequate for any hospital visit or stay in the United States. 

 

When traveling to the United States, you always want to purchase your travel insurance from a US-based travel insurance provider so that you can have numerous policy options and pricing to choose from. 

 

Don’t think that you will be a “lucky” traveler and be safe from having a medical mishap 

 

Travelers have been known to injure themselves while traveling to the airport or while at the airport waiting for their flight. Injuries have occurred while disembarking from tour buses or cruise ships, but most injuries that happen abroad are no different than injuries or illnesses that could happen at home – but you won’t be at home, and if in the United States you would be looking at a minimum of 105,000 INR (1,500 USD) just to be admitted to an emergency room. 

 

What kind of travel insurance coverage do I need to have when traveling to America? 

 

The most important travel coverage you will need when traveling to the United States is medical coverage. It is recommended to have up to $2 million USD in coverage when traveling to the United States. If you can afford more, purchase more—it is not uncommon to accrue $2 million USD if a serious illness or injury requires hospitalization and surgery in the US. 

 

Travelers need to think about flight cancellations, emergency evacuation for both medical and global incidents such as California earthquakes, Florida hurricanes and Midwest tornadoes when visiting the United States. 

 

In addition to medical mishaps, foreign visitors could potentially be denied border entry, have their luggage or passports lost or stolen and need to consider being covered for emergency evacuation and emergency reunion with a family member in the US if they fall seriously ill or seriously injured. Repatriation back to your home country in the case of serious injury or illness or repatriation of your remains is sobering, but a necessary coverage option to consider, as is “Cancel for Any Reason” coverage which is the only coverage that will repay a portion of your prepaid expenses due to civil unrest.

 

How does trip insurance differ from travel insurance?

 

“Travel insurance” is often used interchangeably with “trip insurance” which is protection for a travelers’ financial investment made for a trip. Travel medical insurance provides different benefits than trip or travel insurance. Trip insurance generally does not provide medical coverage, but rather coverage for trip-related mishaps, such as flight and trip cancelations or interruptions. All airlines offer trip insurance to their customers before paying for their flight, typically with only one provider offered, and many travelers will click this option, not realizing that there are many more options for purchasing trip insurance with more comprehensive coverage. 

 

Trip insurance would cover the aforementioned scenarios including loss of passports and luggage, border entry denial and Cancel for Any Reason coverage, which allows cancellation of your travel up to two days prior to departure due to family illness or death, work reasons, a natural disaster or civil unrest in the city you are planning to visit. Cancel for Any Reason coverage allows you to recoup up to 75 percent of prepaid expenses should you cancel your travel plans. 

 

Benefits of purchasing a US-based visitors travel insurance policy:

 

 

Purchasing a travel insurance policy in India may seem like a good deal as your vacation costs add up, but this is one expense you can’t afford to “go cheap” with. 

 

Rajeev Shrivastava, is CEO of VisitorsCoverage Inc., an InsurTech company operating in the travel insurance space with a mission to simplify travel insurance for travelers.