How to get unclaimed insurance payments

0
0

Unclaimed amounts arise from claims for death, health benefits, maturity claims, survivors’ benefits, buyouts or foreclosures.

As the amounts not claimed from insurers have increased considerably, the regulator has updated the standards for monitoring, reporting and certification of these amounts. All insurance companies will transfer unclaimed money from policyholders for more than 10 years to the Elderly Welfare Fund (SCWF). The insurers will transfer the money to SCWF no later than March 1 of each year.

Policyholders or their beneficiaries will be able to claim contributions under their policies up to 25 years from the date of transfer of the money to SCWF. If no claims are made for a period of 25 years after the transfer to the SCWF, the amounts will disappear, i.e. revert to the central government.

Unclaimed amounts arise from claims for death, health benefits, maturity claims, survivors’ benefits, buyouts or foreclosures. Often, claims settled by insurers may not have been paid due to policyholder disputes. An excess premium could be collected by the insurer and not reimbursed to the policyholder at the time of settlement of the claim or of payments at maturity.

The Insurance Regulatory and Development Authority of India (Irdai) has emphasized that the policyholder protection committee of the board of directors of the insurance company will oversee the timely payment of policyholder contributions. Each insurer will provide details of the measures taken and the status of unclaimed amounts to the regulator every six months.

ALSO READ  Insurers settle 4.79 lakh Corona claims amounting to Rs 4.427 crore

Show on website
Any unclaimed money from policyholders over Rs 1,000 will need to be posted on the insurance company’s website. Insurers will have to facilitate the processes allowing insureds or their beneficiaries to know the unclaimed amount owed to them. The website must have an interface where policyholders or their beneficiaries can provide policy number, policyholder PAN, policyholder name and date of birth to find out unclaimed amounts from the company.

To recover the unclaimed money, insureds or their beneficiaries must enter this information on the insurer’s website. If the information entered matches the insurer’s database, then the name and address of the policyholder against whom any unclaimed amount rests with the insurer will be displayed. Once the unclaimed amount is located, they can approach the insurer to get the money.

Insurers will remit the proceeds of all claims, payments at maturity or any amount owed to policyholders or their beneficiaries via an electronic mode such as national electronic funds transfer, electronic clearing system, real-time gross settlement or the interbank mobile payment system. For all life insurance policies, a standard clause should be included as a footnote in all future communications with policyholders. In the case of general insurers, including independent health insurers, bank details will be taken in the event of a claim or reimbursement or when the policy is renewed.

ALSO READ  The value of the LIC should be assessed by an advisor: Govt

For all new policies at the application stage, the insurance company will take the details of the applicant’s bank account. Insurers will need to collect necessary documents such as a void check as proof of bank account to ensure authenticity. Insurers will offer policyholders the option of changing or modifying the bank account if the policyholder wishes. In order to minimize the occurrence of unclaimed amounts, insurers will keep policyholders informed of any updates, changes and due date details by SMS or email.

Accounting for unclaimed amounts
Irdai informed that insurers will keep a single segregated fund to handle all unclaimed amounts and that the sum of each fund will be invested in money market instruments, liquid mutual funds and bank term deposits when due. Insurers will disclose the unclaimed amount as a separate item in the specified notes or appendices to the balance sheet. Checks issued by insurers against the amount unclaimed but not cashed by the insured will be credited at the unclaimed amount after the expiration of the validity period of the checks.
Insurers will credit the investment income accrued on unclaimed amounts to the respective identified unclaimed amount. Unclaimed fund income will be shown as a separate line in the table of current assets as well as

ALSO READ  5 things to consider when buying a health insurance plan

Current liabilities, net of fund management fees. Insurers will pay the identified unclaimed amount and investment income to insureds or beneficiaries whenever a claim is made in accordance with the procedure.

Do you know what it is? FE Knowledge Desk explains each of these and in more detail at The Bharat Express News Explained. Also get live BSE / NSE stock quotes, latest mutual fund net asset value, top equity funds, top winners, top losers on The Bharat Express News. Don’t forget to try our free income tax calculator.

The Bharat Express News is now on Telegram. Click here to join our channel and stay up to date with the latest news and updates from Biz.

.