President Dr Arif Alvi has asked Jubilee Life Insurance Co. Ltd to pay Rs 1.2 million to the widow of a deceased policyholder. The company had ignored the payment of Rs 1.2 million as the unit price of the policy and simply returned an amount of Rs. 4.5 million, deposited by her late husband as premium, to the widow. Mst. Iffat Naheed (the complainant) had filed a representation with the President against the order of the Federal Insurance Ombudsman (FIO) which had ordered the case to be closed as the insurance company had refunded Rs 4.5 million in an alleged amicable settlement to the widow. While accepting the widow’s plea, the President held that the company after having invested the money of the policyholder in business must have earned considerable profits and it would be unjust to deprive the complainant of his contribution to the earned profits as per the principle of economic and distributive justice enshrined in the preamble of Pakistan’s Constitution, 1973. As per details, Mr Muhammad Shafique had obtained a life insurance policy from Jubilee Life Insurance Co Ltd in 2016 and deposited Rs 4.5 million with the company. Mr Shafique died on 08.12.2018 and his widow filed the death insurance claim after which the company refunded her the Rs 4.5 million, paid by her late husband, as ex-gratia payment. Feeling aggrieved, the complainant approached FIO to seek justice which passed the impugned order. Subsequently, Mst Iffat Naheed filed a representation with the President for the redressal of her complaint. After investigating the matter, President Dr Arif Alvi accepted the representation of the complainant and ordered the company to pay an amount of Rs 1,235,339 to the complainant within 30 days. He observed that FIO had failed to notice that the amount of Rs 4.5 million refunded to the complainant under the garb of ex-gratia amount was the actual amount that was deposited by the deceased policyholder. The President termed the alleged amicable settlement of Rs 4.5 million as against all norms of justice and fairness and stated that the complainant on account of acute financial hardships had accepted whatever was being paid by the company and it was not an act of free will and volition. Referring to Article 3 of the Constitution of Pakistan which provides that the State shall ensure the elimination of all forms of exploitation, the President underlined that Insurance Ordinance, 2000 had been promulgated to regulate the business of the insurance industry and to ensure the protection of the interests of the insurance policyholders. He emphasised that it was incumbent upon the State to ensure that people are not exploited because of their wants, needs and economic compulsions. The President stated that since the payable amount of Rs 1.2 million of the unit price of the policy had been totally ignored by FIO before disposing of the matter, therefore, the representation of the widow is accepted and the company is directed to pay Rs 1.2 million to the complainant within 30 days.
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