IRDA has asked insurance companies to allow policyholders to opt out of the ECS facility for making premium payments. IRDA has also asked life underwriters not to levy any charge if policyholders opt out from ECS.
Payments made through ECS are automatically deducted from policyholder’s bank account, as per pre-specified date. “Since the ECS enables premium collection without any manual intervention from policyholders, life insurers should allow them to withdraw from ECS facility at least 15 days prior to the due date of ECS submission,” said IRDA.
The regulator has asked insurance companies to inform policyholders about the procedures and timelines involved in ECS mode before opting for this service. Also, it has instructed life insurers to notify all the policyholders who have opted for ECS mode about the option to withdraw from the ECS facility.