Secrecy, forgetfulness or sheer lack of knowledge can cost you and your loved ones real money.
Unclaimed amount belonging to policyholders lying with insurance companies has reached nearly Rs 12,000 crore. This data, collated across life and general insurance companies, shows the huge size of unclaimed money-pot and is an indication of the kind of financial resources that is simply getting wasted as it waits for the rightful owner. This unclaimed money could be from death or maturity claims, survival benefits and premium refunds etc.
Just to put it in context, a kitty of Rs 12,000 crore is comparable to the Skill India Mission outlay for imparting skills to 1 crore people for 4 years, or more than half of the Clean Ganga budget outlay. According to a DNA Money analysis, life insurance companies are in possession of unclaimed amount worth over Rs 11,000 crore belonging to policyholders at the end of June 30, 2017.
More than half of it – Rs 6,003 crore – belongs to LIC, the biggest player in the life insurance industry. Private-sector insurers including Reliance Nippon Life Insurance, SBI Life Insurance, Bajaj Allianz Life Insurance, ICICI Prudential Life Insurance, and HDFC Standard Life Insurance have between Rs 500 crore to about Rs 950 crore each. These figures are mentioned in the 'L-19 current liabilities' disclosure put out by life insurers in their latest June quarterly financial report.
PNB MetLife India Insurance, Aditya Birla Sun Life Insurance, Aviva Life Insurance and Tata AIA Life Insurance individually have Rs 200 crore to about Rs 300 crore lying unclaimed.
Anilkumar Singh, chief actuarial officer, Aditya Birla Sun Life Insurance said, "Money paid due to maturity of policies or due to surrender of the policy and not received by the customer is considered as unclaimed insurance money. Unclaimed funds are due to change of address of the customer, instruments getting lost, incorrect bank account details, branch details undergoing a change, etc."
About 11 life insurance companies individually have unclaimed money worth between Rs 20 crore to Rs 65 crore.
Also, public sector and private sector general insurance companies have a combined amount of about Rs 900 crore lying unclaimed, the data shows.
Mahavir Chopra, director-health, life and strategic initiatives, Coverfox.com said that any amount that has not been claimed for more than six months since their settlement date are considered under unclaimed amount by the insurance company. This could be in the form of death or maturity claims, survival benefits, premium refunds (when a policy is cancelled) or indemnity claims - including accrued interest, etc.
The Insurance Regulatory and Development Authority of India (Irda) has issued clear guidelines to all insurance companies (in both life and non-life insurance space) to provide details of unclaimed insurance money on their respective websites. To save the insurers the trouble of putting out details of very small claim, the rules allow companies to publish details if the unclaimed amount is of Rs 1,000 or more.
"As per the recent Irda circular, any unclaimed money with an insurance company will be moved to the Indian government's Senior Citizens Welfare Fund, if the amount has been lying unclaimed for 10 years from the date it was payable to the policyholder or the beneficiary. If no insurance claim is made for a period of 25 years after the transfer, you will have to forfeit the money and it will belong to the government," Chopra said.
HIDDEN FORTUNE
- More than half of it – Rs 6,003 crore – belongs to LIC
- Private insurers have Rs 500 crore-Rs 950 crore each
- These figures are disclosed by life insurers in their June quarterly report
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More than half of it – Rs 6,003 crore – belongs to LIC, the biggest player in the life insurance industry. Private-sector insurers including Reliance Nippon Life Insurance, SBI Life Insurance, Bajaj Allianz Life Insurance, ICICI Prudential Life Insurance, and HDFC Standard Life Insurance have between Rs 500 crore to about Rs 950 crore each. These figures are mentioned in the 'L-19 current liabilities' disclosure put out by life insurers in their latest June quarterly financial report.
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