Government Relaxes Date To Pay Insurance Premium Following The Extension Of Lockdown

Highlights:

• With this extension, your premium will continue to provide benefits
• Lockdown has been extended until 3^rd May
• This includes Health and Auto-mobile insurances as well

On Thursday, the Ministry of Finance announced that an extension on the deadline to pay for the automobile and health insurance will be provided in line with the extension of the nationwide lockdown.

It said that if a policyholder’s insurance premium is/ was due during the 40 day lockdown period, i.e. March 25^th to May 3^rd, and he/ she was unable to pay the premium on time, such payments could be made until May 15^th.

Union Finance Minister, Nirmala Sitharaman, on Twitter, wrote, “With a view to mitigate hardship to policyholders whose health and motor (third party) insurance policies are due for renewal during the covid-19 lockdown, the government has issued notification allowing policyholders to make payments on or before 15.05.2020 towards renewal of their policies,”.

With a view to mitigate hardship to policyholders whose health & motor (third party) insurance policies are due for renewal during COVID-19 lockdown, Govt. has issued notification allowing policyholders to make payments on or before 15.05.2020 towards renewal of their policies. pic.twitter.com/KauhDvovhf

— NSitharamanOffice (@nsitharamanoffc) April 16, 2020

This relaxation comes as nothing short of a sign of relief for the policyholders who could not or will not be able to make payments amid the lockdown imposed across India by the government which started on March 25^th and then was extended on 14^th April until the 3^rd of May in order to contain the spread of COVID-19 in the country.

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The notification includes continues benefits of the insurance policy to the policyholder despite a delay in the payment of the premium amount till 15^th May, in this case.

The official notification said, “The policyholders whose motor vehicles third party insurance policies fall for renewal during the period on and from 25 March up to 3 May and who are unable to make payment of their renewal premium on time in view of the prevailing situation in the country as a result of the coronavirus disease, are allowed to make such payment for renewal of policies to their insurers on or before May 15 to ensure continuity of the statutory motor vehicle third party insurance cover from the date on which the policy falls due for renewal so that any valid claim triggered during the grace period can be paid,”.

On 24^th of March, Prime Minister Narendra Modi announced a 21 day lockdown starting from 25^th of March which brought the economy to its knees as the majority of the businesses came to a stand-still to contain the spread of the deadly virus and keep the casualties at the minimum.

On 14^th April, what was supposed to be the last day of the 21 day lockdown period, PM Modi extended the lockdown till 3^rd of May As the cases of COVID-19 in India increased at an increasing rate.

The pandemic has disrupted all the business activities and even the factories have been shut down, educational institutions across the nation have been closes and a ban on travel – Air, Road, and Train – has slowed down the movement of goods.