How to find lost or unclaimed Insurance amount in India?

Let us say your parents or relative purchased a Life Insurance and he/she never shared about this with family. In case of death and documents were also misplaced then there is a probability that it get unnoticed. Such amount for the rest of life will be with Life Insurance Company.

Unclaimed Insurance

You cannot believe it that such amount touched 4,865 Crores for the year of 2012-13. Below are the some statistics about the same.

Year 2009-10 unclaimed amount was Rs.1, 372.64 Cr.

Year 2010-11 unclaimed amount was Rs.1, 945.93 Cr.

Year 2011-12 unclaimed amount was Rs.3, 037.46 Cr.

Year 2012-13 unclaimed amount was Rs.4, 865.81 Cr.

(Source IRDA)

So imagine how many families actually missed their lost person’s real asset. Due to the sudden demise of our family member or friend then there will be an emotional loss, which no one can fulfil. However, if dependents loose the financial help then the family will be actually on the road. I don’t know how many families amount constitutes this Rs.4, 865 Cr. and in what state of life they are.

The reasons for such growth in unclaimed insurance amount listed below.

  • Lack of awareness-Major reason is insured person never shares their financial life with their near and dear one’s. They hide all information for one reason or another. However, at the end if in case of sudden demise of such insured then family members are not in a position to claim it.
  • Delayed claim settlement-Due to the delayed process of issuing a claim cheque and processing part from family dependents involves time. At this time, the issued instrument may be barred. Such amount just left with insurance companies itself.
  • Change of address-Sometimes insured persons never update about their change in communication or permanent address. This makes tough for insurance companies to send the maturity amount in time.

Considering such hardships, IRDA came up with a few measures, which are in the right way and are mentioned below.

From now onward, all future payments from insurers will be through electronic transfer means directly to your bank accounts. Therefore, from now onward, they will not issue cheques or drafts. For new policies, it is mandatory to policyholder to provide proper bank details. However, in case of death of policyholder then the bank details of nominee will need to be produced to insurance companies.

There is no charge from insurance companies to change your bank, branch, or modification of any information related to bank. But do remember that any claim amount of Rs.10, 000 (in the case of Life Insurance) or Rs.25, 000 (in case of General Insurance) will not come under such rules. All term insurance policies are also exempt. In case of death of insured then bank details of nominees will be asked for. If you have a co-operative bank or regional, rural bank, which is not linked to RBI Core Banking Solutions, then too you are exempt from such restricted online transfer of claim. In addition, if your yearly premium is less than Rs.25, 000 then too you are exempt.

But today (20th Aug 2014) IRDA moved a step further to strengthen such service and issued some wonderful ideas to help the dependents of insured to find the unclaimed amount.

How to identify the lost or unclaimed insurance amount?

  • You will find information about such unclaimed insurance amount on respective insurance company websites. However, the amount of such unclaimed amount should be more than Rs.1, 000. This makes life easier for family members of insured to identify such unclaimed amount.
  • Second biggest change you notice from IRDA guidelines is, all insurance companies need to provide the facility on their website to track any unclaimed amount of a relative.
  • If you enter any two details of these like Policy No., PAN of policyholder, Name of policyholder or date of birth of policyholder then you can identify the insurance details.
  • However, do remember that name of the policyholder and date of birth is compulsory and PAN number or policy numbers are optional fields.
  • Initially, insurance companies will upload such information until 31st December 2014. Such information will be available to all by 31st January 2015. After that, information will be updated on half yearly.
  • So as of now you need to wait till 31st January 2015 to get such information.
  • Definition of unclaimed amount is-Amount payable as death claim, maturity claim, survival benefit, premium due for refund, premium deposit not adjusted against premium and indemnity claims etc. remained unclaimed beyond six months.

Therefore, wait for another 5 months, once data garnered from insurance companies then it is very much easy to identify any such unclaimed amount of your family pending with the insurer. In addition, I hope that not all insurers will postpone the deadline set by IRDA and by doing so they save plenty of families.

Image courtesy of [Stuart Miles] at FreeDigitalPhotos.net

15 Comments

  1. Its really informative link this is. Thanks basu.

    Reply
  2. Dear basu,
    Is it any Web sit where we can track our clients future benefits premium remind and other details all insurance company details in one place
    M . 9624550101

    Reply
    • Dipesh-No need to run behind any other site. Soon you will find the individual insurance companies provide such facility on their website. Wait and watch.

      Reply
      • Hello Basavaraj,
        Is it possible to find details of insurance policies on the website of respective companies?
        What if you know there is a Life Insurance Policy but do not know from which company? Then how does one track the Company from where the Insurance was taken?
        Please help as it is critical for me to locate this information at the earliest.
        Many thanks in advance.

        Reply
        • Urmi-There is no such centralized system. Hence, in my view better to check with individual companies by visiting their respective portals.

          Reply
  3. I am regular reader of your blogs, found new information every time. Same experience this time. Thanks a lot Basu.

    Reply
  4. It’s interesting to find, that on the India’s oldest and biggest insurer, the LIC website, I couldn’t find the option to check unclaimed poicies information. Most Private insurance websites make it mandatory to enter policy number to check unclaimed policy info. If only one were to know the policy number, why would they be unaware of the policy and why wouldn’t any sane dependent not claim it? Strange/insane are the ways corporate world works!!!

    Reply
    • Teja-My reply lies in your comemnt 🙂 Oldest..biggest and Govt backed….Let us wait and watch when they will open their eyes.

      Reply
  5. Hi Basu,

    Great article once again. A good beginning by IRDA. Govt should urgently consider making it easy for the dependents, to claim the unclaimed accounts from PF and Banks. Govt is enjoying 26000 crores (wow!) in unclaimed PF/Banks, without any interest additions to them…! High time Govt has to act on these, for public. It’s public’s money.

    Reply
  6. Very informative. I have seen many clients who do not share details about investments with family members. In any unfortunate event, the nominee or legal heir may not b able to claim. Maintain a physical file or excel sheet with all investment details n share it with family members. Consider creating a portfolio tracker on website like http://www.moneycontrol.com

    Sreekanth.
    (www.onlinefinancialplanner.in)

    Reply

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