The Insurance Regulatory and Development Authority of India (IRDAI) has updated its Master Circular regarding policyholders’ unclaimed amounts in response to increasing concerns over the growing sums of money left unclaimed with insurance companies.
Insurance providers are encouraged to intensify their search for the rightful recipients of these pending disbursements and ensure the swift allocation of these funds.
Furthermore, Insurance companies are instructed to carry out the following precise actions to decrease the existing quantity of unclaimed claims and to avoid future rises in these claims:
· Encourage existing policyholders to refresh their contact information, including mobile number, email address, physical address, bank account details, nominee information, etc., when they pay their renewal premium, regardless of whether the payment is made online or offline.
· Assign accountability to the respective agents, intermediaries, group master policyholders, and other distribution channels.
· Ensure the completion of ongoing KYC processes according to current regulations and initiate re-KYC for minors as soon as they reach the age of majority.
· Implement robust systems to automatically verify the mobile numbers and email addresses of both new and existing customers, ensuring these contacts are distinct from those used by distribution channels.
· Collaborate with credit bureaus, account aggregators, customer service centers/point-of-sale terminals, and e-commerce platforms to locate customers.
· Utilize both print and digital advertising to connect with customers who cannot be located through usual channels.
· Provide a feature on the website/portal/app allowing customers to update their contact details, including email addresses, bank information, and nominee details.
- Develop an online tool for processing and payment of unclaimed amounts once the consumers identify the amounts due to them on the websites of insurers
- Put in place appropriate systems and controls to address fraudulent claims and practices.
- Dispatch early notifications regarding maturity claims and survival benefits to customers at least six months in advance via all available communication methods.
- Encourage them to submit KYC and bank details, with follow-up reminders sent every two months to those who have not yet responded.
- Create an online platform for the processing and payment of unclaimed amounts, enabling customers to identify funds owed to them on insurers’ websites.
- Establish effective systems and measures to prevent and manage fraudulent claims and activities.
IRDAI proposes new regulations to protect policyholder interests
