Cancellation or change in nomination in insurance policies now comes at a cost as regulator IRDAI has allowed life insurers to charge up to Rs 100 for any such modification.
For policies obtained online, the fee is up to Rs 50. The IRDAI guidelines for ‘Registering Cancellation or Change of Nomination’ have come into effect from April 1, 2015.
The Insurance Act allows the holder of a life policy to nominate, on his own, a person or persons to whom the money shall be paid in the event of his death while effecting the policy or any time before it matures.
“In respect of those policies that are issued in electronic form… the fee collected shall not exceed Rs 50. In respect of policies other than those, the fee collected shall not exceed Rs 100,” the Insurance Regulatory and Development Authority of India (IRDAI) said in an order.
“No fee other than what has been prescribed shall be collected for registering a nomination either at the time of effecting a policy of life insurance or at any time thereafter or towards any other services relating to nomination,” the regulator added.