Life Insurance Corporation of India has forfeited the amount running into several hundred crore paid against over 4.42 crore policies during the last seven years.
On top of this,there are 1,80,031 policies which are lying unclaimed with the LIC even after their maturity period is over,LIC said in response to an application filed by The Indian Express under the Right To Information Act.
However,LIC refused to disclose the amount which was already deposited against these policies by the policy holders. Normally,if the premium against any policy is discontinued continuously for five years,it is lapsed and can not be revived.
While during the current year 2011-12,only 7,57,215 polices were lapsed permanently in this category,this number was over 59.96 lakh in the previous year.
This figure for the current year may be higher because the LIC says that the information is not readily available with us and the same can not be extracted without scrutinising more than 40 crore policies in our records and without writing new programs to create information in the format in which it is sought. However we are providing the data of policies which are in a lapsed condition for more than 5 years as on 15th November 2011.
On the amount paid against these lapsed policies,LIC Executive Director Saroj S Dikhale said,The total amount deposited under a policy till the date of lapse,is not available as the same is never extracted for any of our routine purposes. The same can not be calculated without going through the premium payment transactions under these policies. The number of premium payments made would be more than 35 crores every year.
This denial is shielded by section 7(9) of the RTI Act,which says that a public authority may deny any information whose extraction would disproportionately divert its resources.
When asked for details of the policies which are lying unclaimed even after they got matured,she said,Total number of policies which are matured and still outstanding for payment in our books as on September 30,2011 are 1,80,031. This is figure is not static and it goes on changing from month after month. Maturity claim settlement is continuous process.
Though the LIC launches the revival campaigns every year to revive lapsed policies,there is hardly any revival scheme for the policies which are lapsed for more than five years. In an earlier reply to this correspondent,LIC had said that policy holder can revive his policy within five years from the date of first unpaid premium.
Ironically,it has provided the information for the lapsed policies where the lapse period is within 5 years from the date of first unpaid premium. LIC said there was a special revival scheme for these policies during January 19,2009 to February 28,2009 and there were only 14,221 policies of this category which were revived.