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The Insurance Regulatory and Development Authority (Irda) has issued guidelines with respect to group insurance policies/schemes administered by the Reserve Bank of India (RBI)-regulated scheduled commercial banks, NBFCs having certificate of registration from RBI and National Housing Bank (NHB)-Regulated housing finance companies as group organizers/master policyholders.
These guidelines are applicable in respect of only group life insurance polices/schemes obtained under lender-borrower groups and administered by the above entities.
This is subject to the conditions that the individual member of the group life insurance scheme/policy shall specifically authorise the life insurance companies to make payment of outstanding loan balance amount to the master policyholder by deducting from the claim proceeds payable on the happening of the contingent event covered by the group life insurance scheme/policy.
The above guidelines are effective from Thursday.
