New Delhi:
In a major relief for retail insurnace customers,the government has extended the validity of health and motor vehicle insurance policy in the wake of the 21-day lockdown due to Covid-19. Those who have their renewal date for motor and health insurance between March 25 and April 14 get an extension till April 21.
The order has come into effect from April 1.
The government has provided relief for third-party auto insurance policy holders and health insurance policy holders in light of the Covid19 situation, tweeted finance minister Nirmala Sitharaman
In a gazette notification, the ministry of finance amended part 64VB of the Insurance coverage Act, 1938, which doesn’t allow advance protection with out fee of premium.
"The policyholders whose motor vehicle third party insurance policies fall due for renewal during the period on and from 25th March, 2020 up to the 14th April, 2020 and who are unable to make payment of their renewal premium on time in view of the prevailing situation in the country as a result of coronavirus disease (COVID-19), are allowed to make such payment for renewal of policies to their insurers on or before the 21st of April, 2020 to ensure continuity of the statutory motor vehicle third party insurance cover from the date on which the policy falls due for renewal," stated the notification.
From its side, the IRDAI has said that the policyholders, whose policy terms are are being extended, will be required to pay the renewal premium for the entire period of 12 months from the date it was due, on or before 21st April, 2020.
Insurers shall communicate the above details to the concerned policyholders including through e-mail, SMS, telephonically, display on website etc immediately in a manner that is correctly understood by them.
Agents and intermediaries are also to be duly informed so that all concerned are aware of the last date for payment of premium for the purpose of ensuring continuity of the said cover.
When the policy is issued after receipt of premium due on or before the last date indicated above, it shall be ensured that the period of cover commences from the date the renewal was due without there being any break in the policy period provided such renewal fell due within the lockdown period (25th March, 2020 to 14th April, 2020).
Insurers shall ensure that adequate arrangements are made for ease of payment of premium by policyholders during the week following the end of the lockdown period (the last date being 21st April, 2020).
Insurers will have to ensure that adequate arrangements are made for ease of payment of premium by policyholders during the week following the end of the lockdown period (the last date being 21st April, 2020)..