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ICICI Lombard Expert Blog

Deferral Period for Renewal Premiums Extended by IRDAI

December 02 2016
Deferral Period for Renewal Premiums Extended

As per the authoritative order of Life Insurance Council, Insurance Regulatory Development Authority (IRDAI) has extended the deferral period by 30 days for the remittance of all renewal premiums falling between 8th November and 31st December 2016.

'Deferral Period' is a time frame (which for monthly mode policies is 15 days and others is 30 days) given to the policy subscribers for payments of their renewal premiums. This verdict has been taken considering all those exclusive policy subscribers who normally reimburse their premiums in cash as they are experiencing an arduous liquidity crisis due to current demonetisation of `500 and ` 1000 notes. This has been specifically expressed as a “special, one off dispensation” by the IRDAI.

IRDAI has taken this desirable step in the favour of all policy holders. As opposed to rumours being circulated, the regulator clarified in a quick follow-up to the first circular that life insurers are not informed regarding the receipt of `500 and ` 1000 notes. The subsequent quote on the IRDAI website clearly states that, “The above circular does not mention acceptance of the said old notes and it merely extends the grace period of the policies issued”.

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