Don’t let that unclaimed insurance slip out of your hand. Here is what you can do.
PTI detailed that as much as Rs.15,167 crore of policyholders’ cash was lying unclaimed with 23 backup plans as on March 31st 2018. Out of which, Life Insurance Corporation (LIC) has Rs.10,509 crore as unclaimed assets, while the rest of the Rs.4,657.45 crore is with the 22 private sector insurers.
Reasons for unclaimed funds;
Failure in filing claims:
Mahavir Chopra, Director – Health, Life and Strategic Initiatives at Coverfox.com said, “The biggest reason for a large amount of unclaimed funds lying with the insurer is not filing claims. An insurer not receiving any intimation from a policyholder or its nominee, especially in case of term insurance claims, does not make him liable to pay the claim amount.”
Change in contact / bank account details of the beneficiary:
Suresh Agarwal, Chief Distribution Officer, Kotak Life Insurance said, “Change in contact/bank details of the beneficiary (in case of claims payable during survival and maturity benefit under money-back plans) and the same not being updated by the policyholder with the insurer is another reason of rising unclaimed funds.”
Chopra explained, “For instance you have a money-back plan that pays 20 percent of the sum assured every 5 years. However, the pay-out cheques sent by the insurer never reaches you because you have moved to a new address and have not updated the same with the insurer or there’s failure in processing the NEFT/ECS orders due to incorrect details or closure of bank account.”
Policy cancellation and failure in refund processing:
Chopra said, “Policy cancellation and refund money not reaching the policyholders is another reason for the rise in unclaimed funds.” For instance, you have taken a life insurance policy with a limited premium payment period of 10 years for a policy term of 30 years. But, after 5 years you decide to surrender your policy, so the refund amount could be small which is easier to slip from your follow-up list and adds to unclaimed amount.”
Dispute among beneficiaries:
Agarwal said, “In case there are multiple beneficiaries, probability of dispute among them is high. In such a scenario, in case of death of the policyholder, there would be no information to the insurer and based on the status of the policy the money payable could get transferred to unclaimed fund.”
How to find if any of your claims are pending with insurance company?
Agarwal says, “A policyholder can call up/email the customer care of the insurer or visit the branch and based on the policy number and validation of the identity the details pertaining to the policy will be shared by the insurer with the policyholder.”
Chopra suggested, “You can also simply look under the tab titled ‘unclaimed amount of policyholders’ on your insurer’s website.” Enter name of the policyholder, policy number, PAN, Aadhaar number and DOB when the page opens. After filling the detaisl, you will get the details of any unclaimed amount.
Anoop Pabby, MD & CEO, DHFL Pramerica Life Insurance added, “The policyholder’s name and date of birth are mandatory, whereas PAN and policy number could be optional. Based on the above information entered, the insurer’s website on matching of the mandatory two shows the amount lying unclaimed with the insurer.”
What policyholders should do now?
Pabby said, “A lot of policyholders do not share the insurance details with their family members nor keep the record of insurance policies properly. There are several scenarios where the next of kin are unaware of the insurance cover.”
Rajeev Chugh, CFO, Aegon Life Insurance recommended, “Policyholders should record all his/her financials and insurance policy details at one place for easy reference in future.”
Claims are pending with insurance companies due to some reasons. Navin Chandani, Chief Business Development Officer at BankBazaar said, “Every claim has an associated claim ID. You should log in to the insurer’s website and look up the status of your claim using this ID.”
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