Agent Earn Commission On LIC Business

This refers to grievance application no. 04-17-000058 

and PMO PMOPG/E/2017/0156895 - policy no. 283453384 

You acknowledged my complaint and forwarded to insurer. I wrote to PMO ,they also acknowledged it and forwarded to insurer. In response to it, Insurer also wrote a four line letter to me advising me to contact branch from where policy was issued and closed the chapter. 

However as request by you to revert on the matter after 15 days , I am taking an opportunity to write you once again seeking solution to my problem. I also make an appeal to arrange for required modification in LIC rules if needed. 

This is the characteristics in general to majority  of public grievance cell or customer help centre functioning in majority of government offices or departments or public sector undertakings in our country. Staff or officers posted in such cell  forward the complaint to the authority concerned and close the issue for ever without looking into merit of the case. Concerned offices write a formal letter to complainant and close the chapter .

I do not know whether points explained in my complaint lodged to LIC office , your office as well as that of PMO are given due consideration or not. There is no benefit in having such customer help centres if they are acting simply as forwarding agent of complaints received . 

I have raised certain issues which are valid and which remains unanswered even after prolonged correspondence in this regard. If my complaint does not fit in the existing rules and regulations of LIC and the organisation is rigid in established practices, then merit of such complaint must be weighed from the angle of happiness and comfort level of consumer sin general provided to consumers and if it does not cause any material or financial loss to the organisation, the valid points must be considered . And if there is merit in issued raised by me , the issues contained in the complaint must be considered as if they are  suggestions and dealt accordingly .

There must be some sort of flexibility depending on the merit of the case. In this way LIC will not help an individual but make it more comfortable, hassle free and acceptable to all policy holders. It is a matter of culture which portrays the picture of the organisation in true sense. 

Point no. 1:-  After all customers expect service in improved manner when there is technological upgradation in all offices and in all departments . Banks are serving their customers from all their branches within certain well defined limits .Banks provide CBS platform to  LIC in its all branches to enable LIC to receive premiums from all policyholders  in any of bank's branch for any of policy bought from anywhere in the country. LIC in this way accepts premium from any corner of the country . LIC also provides an online platform for deposit of premiums through internet banking. Unfortunately, LIC is  not ready to serve its client from all branches spread all over the country at the time of any claim. 

When premiums can be accepted at any branch or at deposit centers or online , disposal of claims , redressal of public grievances and payment of maturity value can also be made from any of the branch or online through NEFT or other mode of payment which is safe and secure .

Point no. 2:-  I had applied for transfer of the policy document to LIC office situated in my home town almost ten months before due date of maturity. LIC declined it and did not attend to my request saying that such request must be submitted at least one year before ( copy of email submitted to LIC ). 

It is important to point out here that it  has been mentioned clearly in the policy documents given to me that insured person can ask for transfer of policy papers to any branch within six months of maturity date. Why then LIC unilaterally changed the rule of the game and denied my the benefit of transfers. 

Why are they then causing me pain in non-responding to my valid request of final and full payment of maturity value to me and why Giridih branch of LIC denied and ignored my requests when I approached them well in advance and well before maturity date. They did not listen to my point and simply advised to contact branch wherefrom LIC policy was issued. 

Here I would like to say that if a branch of LIC does not and cannot attend grievance of other branch of LIC , then they should be restricted to mobilise business only from their command area. 

They should not ask business from public servants whose services are subjected to frequent transfers and they finally settle either at home town or some other place after their retirement different from place they bought a policy.

Point no. 3 :- Agents of LIC are actively and effectively mobilising insurance businesses all over the country,  around all the branches of LIC and even if remote villages where no branch or no office of LIC is functional. 

An agent of LIC attend to a new client more than ten times to teach benefits of LIC policy , comforts of policy and finally motivate the client to give business. And once the business is procured, the same agent will get commission at certain rate ( say 20 to 30 percent of premium ) out of premium so received by LIC. Not only this , the same agent will continue to earn commission for entire period and tenure of the policy even if the periodical premiums are deposited or paid by policy holder online using internet facility. 

Important question raised here is that an agent who earn commission in hundreds and thousands of rupees for 20 to 30 years of policy tenure without making any extra labour,  why he does not serve the policy holder at the time of maturity. 

Why Government of India or IRDA or LIC management forces these agents legally to serve the customer at the time maturity too?

Why not GOI or LIC make it obligatory on the part of LIC agents to serve policy holder  or otherwise why not they are barred from earning commission from second year of the policy? 

And if they can stop payment of commissions to these agents for year other than the year of issue of the policy,  Government and LIC can serve huge amount of commission in this way.

When agents do not bother and do not take any extra pain after sell of a policy in a particular year , there is no justification in paying them commission for entire period of policy ranging from 10 to 40 years.

Point no.4:- Lastly , LIC management says that they will not make full and final payment to maven after its maturity giving plea that the policy under reference is a pension policy. 

Here also I would like to mention that there is no word like pension mentioned in the policy paper given to me at the time of purchase of the policy. The technical word like annuity and other similar words do not anywhere mention in the policy that policyholder will not be entitled for full payment at the time of maturity and only pension will be paid . 

Agent which sold me the said policy never told me like this that after paying premium for 13 years , I will not be getting full payment and I will be entitled for negligible amount of pension every month.

Point No. 5:- Level of Customer Service : I request you to depute any layman or intelligent officer from your office to any of LIC branch for making any inquiry , either for buying a policy or for getting any claim, you will find that the person will get no response , move from one table to other and finally become victim of some agent who will broker payment of slain at some cost. Officers or staff will never give you proper and satisfactory response . 

After all , what for so many branches are meant for if they are not ready to serve its clients . Are they established only to mobilise new business? 

And if agents are all in all , then why these agents are not made responsible for lapses?

Unfortunately , majority of officers working at various tables are originally an agent only and hence they will always support the line of action taught by an agent , There is no one to listen to the grievance of the client.

I hope you will look into the matter once again and give me point wise reply . I do not want to waste my energy on litigation because I know very well that LIC may spend crores of rupees in justifying its stands whereas I will die in old age and spend my entire hard earned money in contesting case and running from pillar to post in courts of law. Present position of judiciary at least does not allow me to seek justice from court of law. I will rather try to digest injustice and refrain from knocking the door of judiciary or consumer forum

Yours

Copy of IRDA letter via email dated 31.03.2017

Dear Sir/Madam,

We acknowledge your mail.

Your complaint has been registered and forwarded to the Insurer (Email ID copied herein).

You may follow-up with the Insurer at the given email ID and/or revert to us (our call center 155 255) if not attended within 15 days.

Your grievance application No is: 

04-17-000058

  which may be quoted in future correspondence with IRDAI and further follow-up with Insurer.

Regards,

Consumer Affairs Department

IRDAI

Basheerbagh

Hyderabad

Copy of Shaktinagar Branch letter received email dated 03.06.2016 is submitted below

Sir,

    This is to inform you that your policy cannot be transferred by our computer system due to policy no.is to mature on 28/03/2017 less than a year.However ,NEFT registered in favour of ypur given

Registration number issued by PMO on complaint lodged by me is 

PMOPG/E/2017/0156895 -