I had invested Rs. 30000/- in  CAPITAL UNIT GAIN ACCOUNT policy on 23’rd march 2007.

The policy is comprised of 3 different funds. I am giving an example of one particular fund (i.e. growth fund). The 2nd premium was paid by me on 14th may 2008. Since the payment was delayed the company had deducted Rs.7710/- on 23 april 2008, at the unit price of rs.14.458/- 23’rd april 2008 and no. of units deducted where units:533.36 from my policy towards lapse capital withdrawal.

The amount of rs.7710/- was reinstated on 16’th feb.,2009 at the unit price of rs.8.444/- and the no. of units reinstated where units:913.1904

Date              Amount           Unit Rate            No.of units
—————      ————–       ————            ————–
23/04/2008      Rs.7710.98       14.4580               533.3648     Lapse capital Deduction
16/02/2009      Rs.7710.98         8.4440               913.1904     Reinstatement of capital deducted.

The 3’rd premium was paid by me on 22’nd june 2009. Again the payment was delayed so the company deducted rs.13289/- on 24’th april,2009 towards  lapse capital withdrawal at the unit price of rs.9.887/- and the no.of units deducted where units. 1344.1443

Again the amount of rs. 13289 was reinstated on 22’nd june 2009 at unit price of Rs.11.966 and the no. of units reinstated where units: 1110.59

Date              Amount           Unit Rate            No.of units
—————      ————–       ————            ————–
24/04/2009      Rs.13289.39      9.8870              1344.1443     Lapse capital Deduction
22/06/2009      Rs.13289.39     11.9660              1110.5958    Reinstatement of capital deducted.

I have paid the first three premiums as per the policy document

Then I  had partially withdrawn Rs.20000/- on 6’th may 2010. and Rs.39789/- on 7’th June, 2010. Again on 17’th sep.,2010 I had approached for for closure of my policy. At that time I was given a statement in which my fund value mentioned is Rs. 58939.90 and on the top of the statement it is mentioned that surrender penality applicable
is 55.34% of the value of the outstanding capital units. After reading it I really got shocked. I opened my
policy document and checked in it, there it is mentioned as clause no. 31c Surrender

2) So far company does not impose any surrender charge currently on surrender after three-policy year but company
keeps right to impose surrender charge of up to a maximum of 10% of the fund value subject to approval from the IRDA.

I had showed this to the concerned person but they did not answered to my question properly. Then they suggested to me to go for partial withdrawal, but that was not possible as the company had changed the rule to maintain minimum balance of  two annual premium. (i.e. 200%  of annual premium)

where as the policy document clearly mentions that to maintain a balance of one annual premium. They told me we will approach head office and request them to allow to maintain a balance of 150% of annual premium and allow you to withdraw approx. Rs. 13000/- and maintain Rs. 45000/- balance. (at that time my fund value was Rs. 58939.90).
So they tooked my request for partial withdraw and told me that the amount will be credited to my account within
eight days. Sir, I kept on following with them regularly but I had not received my amount. And suddenly on 15’th oct.,2010 they passed an entry towards Lapse Capital withdrawal regular and reduced my fund value from Rs.60000/- to Rs.25000/-

Sir, this is surprising to know only when I had approached for surrender/withdrawal they passed an entry and reduced fund value. There reply to this was they had reinstated excess units on on 16’th feb 2009 They deducted Rs.6633.38/- units 376.5504 at the rate of 17.6160 if they and alloted me excess units due to change in rate then how can they allot me less units  on payment of third premium on 22’nd june 2009.

Sir my simple question is can a insurance company make such type of changes and reduced the fund value by more than 50% They have deducted this units after 2 years. How it was allowed even after the audit is over? Also if the policy document mentions that maximum of 10% of fund value, that also after the approval of IRDA, How can they charge 55.34% as surrender penalty?

Please help me out to solve my problem. Suggest me how can I fight with the insurance company to get back my deducted units.

warm regards

vinay b kulkarni