About half a lakh people in Moradabad who are taking life insurance policy will get a big relief. These are all policy holders, who for some reason could not pay the premium for the second year after paying the premium for the first year or were closing the policy. Now their money will be saved from wastage.
On completion of the policy term, the amount deposited as first premium will be refunded to the policyholder. This new system has been implemented as per the guidelines given by IRDA. So now the policy holders will get the option to close the policy by paying the first premium.
Sanjeev Kumar, manager of LIC branch in Moradabad, said that according to the new rules, the policy holders will get the option to cancel the policy only after the first year. Earlier policy closure was allowed only after two years of installments were paid.
Many policy holders could not pay the second premium after paying the first premium. This was likely to sink their premium amount. However, the new rules will protect their money in such situations and not sink the amount.
As per the earlier rule, the policy was refundable only after two years of installments were paid on maturity. However, since there is now an option to close the policy after the first year's premium, it will be easier to get refunds.
It has been observed that about 20 percent policy holders in Moradabad do not deposit the second installment after paying the first year's premium. This new scheme will give them a way to keep their money safe.
This new system is going to bring a positive change in the life insurance sector. This policy is implemented for the benefit of the policy holders and will provide them with financial security.
