Question : LAPSE INSURANCE POLICIES



(a) whether the Government is aware that a large number of insurance lapsed every year;

(b) if so, the detals thereof; and

(c) the corrective steps taken by the Government in this regard?

Answer given by the minister


MINISTER OF THE STATE IN THE MINISTRY OF FINANCE (SHRI PAWAN KUMAR BANSAL)

(a)& (b): The Life Insurance Corporation of India (LIC) has reported that around 5% of its policies lapse every year and details of the policies which lapsed during the last three years are as under:-

Year	Mean Business	Number of policies	%lapsed	in force	lapsed during the year
2003-04 14,63,53,01 76,37,200 5.22 2004-05 15,84,36,032 85,33,424 5.39 2005-06 17,12,57,388 95,50,596 5.58

(c): LIC has reported that it has taken following corrective steps in this regard:-

(i) Premium Notices for payment of premium are sent one month before ;he due date.

(ii) First Lapse Notice is sent after three months in case, the premium is riot paid on due date.

(iii) Final Lapse Notice is issued after six months in case, the premium is still not paid.

(iv) Floating of Special Revival Campaign.