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Insurance Regulatory and Development Authority (Irda) today said that no life insurer shall levy any additional charges towards cancellation of the Electronic Clearing Service (ECS) mode / recover such additional charges from the benefits payable under the policy.
ECS is an electronic mode of payment / receipt for transactions that are repetitive and periodic in nature. ECS is used by institutions for making bulk payment of amounts or for bulk collection of amounts .
Irda has said that while ECS ode offers great convenience in certain ways to the policyholder, the degree of freedom available with other modes of premium payments not available under ECS mode owing to various inherent reasons.
In order to safeguard the interests of those policyholders that have opted for ECS mode for premium payment, Irda has asked all the life insurers to allow the policyholders facility to withdraw from the ECS mode at least fifteen days prior to the due date of ECS submission.
Further, it said that policyholders are to be made aware of all the procedures and timelines to be adhered to in connection with the ECS mandate, up-front at the time of opting for this mode of payment.
