Insurance Regulatory and Development Authority of India (IRDAI) has allowed an additional 30-day period to life insurance policyholders to pay premium whose renewal date falls in March and April. IRDAI, in another instruction to life insurers, said they may offer settlement options for maturity payout of Unit Linked Policies. Settlement options is a facility extended to the policyholder under the ULIP to receive the maturity proceeds in instalments.
“Where unit-linked policies mature and fund value is to be paid in a lump sum, life insurers may offer settlement options. This onetime option is regardless of whether such option exists or not in the specific product,” the circular said.
The decision comes after representations from life insurers and the Life Insurance Council wrote to IRDAI, in which they had cited “various operational constraints and difficulties being faced by policyholders due to the nationwide three-week lockdown and social distancing norms,” in view of Coronavirus pandemic.
Insurance regulator IRDAI had on Thursday asked insurers to extend dates for renewal of health insurance policies, which are expiring during the coronavirus lockdown duration, till April 21. A notification to this effect was issued by the Department of Financial Services, Government of India, on April 1, 2020.
"The central government has directed that policyholders whose health insurance policies fall due for renewal during the period on and from March 25 up to April 14, and who are unable to make payment of their renewal premium on time in view of the prevailing situation in the country as a result of COVID-19 are allowed to make a premium payment for renewal of policies to their insurers on or before April 21, 2020, to ensure continuity of the health insurance cover," the circular said.
Policyholders shall be required to pay the renewal premium for the entire period of 12 months from the date it was due, on or before April 21, the Insurance Regulatory and Development Authority of India (IRDAI) said. Besides, it said, insurers will communicate the above details to the concerned policyholders including through e-mail, SMS, telephonically, display on website etc immediately in a manner that is correctly understood by them.
(With agency inputs)