Stakeholders allege lack of transparency in transactions

Self-help groups, voluntary organisations, and Akshaya centres are all set to withdraw from the micro-insurance scheme of the Life Insurance Corporation (LIC) of India citing reasons ranging from re-routing of funds to other policies to denial of proper bills for payments.

The various stakeholders under the aegis of the LIC Micro Insurance Agents Welfare Association of Kerala put forward their demands for non-withdrawal from the scheme at a press conference here on Wednesday.

One of the major issues highlighted by the association was the denial of bills for the payments.

“No bills are provided by the LIC to the lakhs of policy holders in Kerala, neither for their monthly payments nor for the interest payments. Most of these payments are of very small amounts. Even for the organisations who work as an interface between the customers and the LIC, the monthly statements are not provided. There is a clear lack of transparency in the dealings. It should return all the money collected from voluntary organisations without giving receipt. The corporation, which is eager to woo new costumers, is not ready to provide continued customer support once the policy is taken,” M.V. Mathew, State president of the association, said.

He said the LIC had not paid the bonus promised to the policy owners. The sub-agents had also not been paid the commission amount, he said.

Some of the LIC employees were re-routing the amount paid by the voluntary organisations to fake policies, the association alleged.

“An arrangement should be made to accept the payment for micro-insurance online, like it is done for normal LIC policies. The offices of the voluntary organisations should be converted as official premium collection centres,” Mr. Mathew said.

He said that in many cases the policy holders had not got even half the amount paid when the policy was cancelled. The current system should be changed in such a way that the policy holders could withdraw the full amount after a period of two years.

“Due to the opaque dealings of the LIC, the voluntary organisations and the sub-agents are seen as liars by the micro insurance policy holders. We demand a CBI investigation into all transactions in the LIC micro-finance programme,” Mr. Mathew said.


UDF alleges fraud in schemeNovember 30, 2013