NEW DELHI: As much as Rs 100 crore is expected to go into the Senior Citizens’ Welfare Fund following a directive by the Insurance Regulatory and Development Authority of India (Irdai) on Tuesday.
The regulator has directed all insurance firms to check on the insurance accruals lying unclaimed for 10 years as on September 30, 2017 and deposit the same into a fund meant for senior citizens by March 1, 2018.
“For the entire insurance industry, it could be more than Rs 100 crore,” said a senior official in the Life Insurance Corporation of India. There are many reasons why insurance accruals remain unclaimed. It could be because some policy holders forget to collect the money or they’ve paid part of the premium period but failed to collect that. Some have changed their residence but failed to update their address with the insurer. In some cases, the nominees of policy holder may not be aware of the insurance amount deposited by the policy holder.
Charanjit Attra Partner in an Indian member firm of EY Global, said, “It is a good directive and keep in pace with the objective of providing the state support for the senior citizens, by utilising the unused funds.”
SCWF rules mandate entities to transfer unclaimed amount of 10 years to the fund. The rules apply to all insurers.
Irdai’s order also directs the insurance companies to collect the details of such accounts and the prescribed format in which the unclaimed deposits have to be submitted from the Department of Financial Services.
The regulator’s past directives to check on policy holders had also benefitted many, as they were able to claim the amount, after following the process, Irdai officials said.