IRDAI vide Circular bearing reference no: IRDAI/Life/CIR/Misc/41/2/2024 dated February 16, 2024, issued Modifications to the Master Circular to Unclaimed Amounts of Policyholders dated November 17, 2020 (‘Circular’) advising insurers to enhance their efforts in tracing the rightful recipient of unpaid amounts and ensure efficient disbursement of the same.
1. Modifications introduced by the Circular:
Sr No
Extant provisions
Modified Provisions
1
2(1) (c) Due Date shall mean the date on which any amount or claim is due for payment to the policyholder/beneficiary as per the Act, Rules, Regulations, Product features or any other directions issued by the Authority
2(1) (c) Due Date shall mean the date on which any amount or claim is due for payment as per the terms and conditions of insurance policy and/or extant regulatory framework
2
2(1) (f) Unclaimed Amount shall include any amount held by the insurers but payable to the policyholders or beneficiaries, including interest accrued thereon, remaining unclaimed beyond six months from the due date or settlement date of such amount, whichever is earlier.
Explanation 1 : Unclaimed amount may arise in case of death claim, health benefit claim, maturity claim, survival benefit, surrenders/foreclosures, premium due for refund, premium deposit not adjusted against premium and indemnity claims.
Explanation 2: In case of general and standalone health insurers, any premium received in advance/ deposits/ unallocated premium during the currency of the insurance policy shall not be considered as unclaimed amount. However, where the premium received in advance / unallocated premium has neither been set off/ adjusted against the premium during the currency of the policy, nor has been refunded within six months of the expiry of the policy, such amount shall be considered as unclaimed amount.
2(1) (f) Unclaimed Amount shall include any amount held by the insurers but payable to the consumers , including interest accrued thereon, on account of their non-contactibility through any means and remaining unclaimed beyond twelve months from the due date of such amount.
Provided, irrespective of the status of the contactibility, the following pending amounts shall be held under separate sub-heading “Litigation and others” under unclaimed amount till such times the payments are made:
- due to any litigation under an insurance policy
- due to rival claims or open title
- due to freezing/blocking of insurance policies by any government agency
Provided further that the payments payable under the following shall not be considered as unclaimed amounts:
- Annuity policies; and all in-force insurance policies including reduced paid up and fully paid up on due date
- In respect of claims initiated by consumer
Explanation 1 : Unclaimed amount may arise in case of death claim, health benefit claim, maturity claim, survival benefit, surrenders/foreclosures, premium due for refund, premium deposit not adjusted against premium and indemnity claims.
Explanation 2: In case of general and standalone health insurers, any premium received in advance/ deposits/ unallocated premium during the currency of the insurance policy shall not be considered as unclaimed amount. However, where the premium received in advance / unallocated premium has neither been set off/ adjusted against the premium during the currency of the policy, nor has been refunded within six months of the expiry of the policy, such amount shall be considered as unclaimed amount.
Explanation 3: A consumer shall be termed non-contactable when such consumer has not responded to any of the insurer’s communications.
Explanation 4: All amounts, where the consumer is not traceable, shall continue to be part of the unclaimed amounts
3
2(1) (g) ‘Consumer’ for the purpose of this circular shall mean proposer, policyholder, life assured, nominee, beneficiary or any other person who has financial interest in the policy as per the terms and conditions of the insurance policy.
2. Insurers shall make all possible efforts for payment of these dues at the earliest and may adopt the measures as specified in Annexure I for reduction of existing unclaimed amounts and to contain future accumulation of unclaimed amounts.
3. Insurers are required to submit the specified statements by the 15 th of every month.
4. The modifications are effective from the date of the Circular i.e. February 16, 2024.
A copy of the Circular is hereby attached for your perusal and ready reference.
Source category: IRDAI
Attachments
- /2024/354_Modifications_to_the_Master_Circular_to_Unclaimed_Amounts_of_Policyholders_dated_17th_November_2020_
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