IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE GOPINATH P.

FRIDAY, THE 14^TH DAY OF JUNE 2024 / 24TH JYAISHTA, 1946 WP(C) NO. 9702 OF 2016 PETITIONER:

LIFE INSURANCE CORPORATION OF INDIA, HAVING ITS DIVISIONAL OFFICE AT JEEVAN PRAKASH, PATTOM - 695 004, THIRUVANANTHAPURAM, REPRESENTED BY ITS MANAGER(LEGAL), DIVISIONAL OFFICE AT JEEVAN PRAKASH, P.B NO.1133, M.G ROAD, ERNAKULAM - 682 011.

BY ADV SRI.R.S.KALKURA RESPONDENTS:

1 SMT.CHANDRIKA, RESIDING AT CHARUVILA PUTHEN VEEDU, MYLOM P.O, KOTTARAKKARA, KOLLAM DISTRICT - 691 560.

2 THE INSURANCE OMBUDSMAN, SECOND FLOOR, OPPOSITE COCHIN SHIPYARD, M.G ROAD, ERNAKULAM, KOCHI - 682 015, REPRESENTED BY ITS SECRTARY.

BY ADV SRI.N.SASIDHARAN UNNITHAN (FOR R1)

THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 14.06.2024, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

JUDGMENT This writ petition has been filed by the Life Insurance Corporation of India challenging Ex.P4 award of the Insurance Ombudsman under the Redressal of Public Grievances Rules, 1998 (hereinafter referred to as ‘1998 Rules’). The brief facts of the case are as follows:-

2. The 1^st respondent preferred a claim for amounts payable under a policy of life insurance taken out by her son Sreejith, who died on 26.10.2012 after he got involved in a bike accident on 25.10.2012. The premium under the policy was payable quarterly at the rate of Rs.7,156/-. According to the petitioner, the last premium paid under the policy was in the month of May, 2012 and the next premium was payable on 17.08.2012. There is a grace period of 30 days from 17.08.2012 and that grace period also expired on 17.09.2012. The petitioner Company therefore repudiated the claim on the ground that the policy was not in force on the date of the death of the son of the 1^st respondent on 26.10.2012. The 1^st respondent approached the Ombudsman and the Ombudsman by Ext.P4 order considered the contentions taken and held that the contention of the petitioner company that the insurance policy was lapsed on 26.10.2012 (date of death of the son of the 1^st respondent) was correct. However on the consideration of the financial status of the 1^st respondent and purely to offer some solace to the 1^st respondent, the Ombudsman directed the payment of a sum of Rs.1,00,000/- to the 1^st respondent as ex gratia in terms of the provisions contained in Rule 18 of the 1998 Rules. It is challenging this decision of the Ombudsman that the petitioner is before this Court.

3. Sri.R.S.Kalkura, the learned counsel appearing for the petitioner vehemently submits that after having found that the policy had lapsed and the petitioner company was not under any obligation to pay any amount under the policy, the Ombudsman could not have arbitrarily directed the payment of a sum of Rs.1,00,000/- as ex-gratia under the provisions of Rule 18 of the 1998 Rules. It is submitted that there must be some justification for the Ombudsman to direct payment of any amount as ex-gratia under Rule 18 of the 1998 Rules. It is submitted that there is no justification in the facts of this case as the policy in question was lapsed more than a month before the date of death of the son of the 1^st respondent in a motor accident. It is submitted that at any rate, the Ombudsman could not have directed payment of a sum of Rs.1,00,000/- as ex gratia.

4. The learned counsel appearing for the 1^st respondent submits that there is no dispute that the insurance policy had lapsed at least by 17.09.2012. It is submitted that the Ombudsman has also held so. It is submitted that Rule 18 of the 1998 Rules permits the Ombudsman to pass an order directing payment of ex- gratia if the facts and circumstances of any particular case before the Ombudsman justify such an order. It is submitted that in the facts and circumstances of the present case, the Ombudsman found that considering the financial circumstances and purely as a matter of solace to the 1^st respondent, an amount Rs.1,00,000/- can be paid a