Page 57 - The Insurance Times March 2025

i. One-time mandate through UPI shall be created: vi. In case the prospect intends to cancel the proposal
a) Only in favour of the insurer. form submitted, before the underwriting decision
of the insurer, the prospect shall make the request
b) Prospect authenticates through one-time man-
date, as per the applicable provisions and laws. through the various modes provided for this pur-
pose by the Insurer. Insurer shall accept the request
c) With a valid period of maximum 14 days or till and release the blocked amount within one day
the date of the underwriting decision, which- from the day of request.
ever is earlier.
vii. The risk shall commence from the date of acceptance
ii. The amount so blocked under Bima-ASBA shall be of the proposal irrespective of the debit from the ac-
unblocked: count of the prospect, in case Bima-ASBA is utilized.
a) Automatically after expiry of 14 days from the
viii. Insurer shall maintain all necessary records and in-
date of initial blocking of funds.
formation that confirms compliance about the
b) within one working day from the date of non- mandates created in its favour and shall be avail-
acceptance of the proposal form; able for inspection by the Authority.
iii. The prospect shall be kept informed at every stage ix. The insurer shall be responsible for any error or
of the Bima-ASBA i.e. blockage of the amount, ini- omission on usage and operation of Bima-ASBA.
tiation of debit (whether in part or in full) and the
10. Procedure for One-time Mandate through UPI
unblocking of the amount so that timely informa- i. The proposal form submitted to the insurer either
tion on blocking and unblocking of funds is provided directly or through distribution channel shall have
to the prospect.
duly filled in standard declaration opting for Bima-
iv. No charges or any additional amount shall be lev- ASBA facility for premium payment which permits
ied for creation of such mandate from the prospect. blocking of premium amount in the bank account
of the prospect;
v. The partner bank shall share with insurer, the de-
tails of the One-Time Mandate created in favour ii. The insurer shall send the request for blocking the
of the insurer, on a monthly basis. premium amount to the prospect’s bank through
any one of its partner banks utilizing the facility
9. Obligation of the Insurer
offered by NPCI;
i. The amount of premium blocked shall be specific
to the proposal form made by the prospect. In case iii. On obtaining express consent from the prospect,
of multiple proposal forms, Bima-ASBA facility shall the prospect’s bank shall block the funds in the bank
be offered separately for each proposal form. account of the prospect and inform the partner
bank through UPI. The partner bank shall then pass
ii. Blocking of the amount shall only be on the basis
of the explicit consent of the prospect in the pro- on this information to the insurer who shall further
posal form. In case the amount of initial premium pass on to the prospect;
blocked is more than the premium to be collected iv. The amount so blocked towards premium shall con-
by the insurer due to its underwriting decision, then tinue to remain in the bank account of the pros-
the insurer shall only collect the reduced amount pect without being debited. Such blocked amount
through this facility. shall not be available to the prospect for any other
use till such time the underwriting decision is made
iii. Where the premium to be charged is more than or 14 days whichever is earlier and may continue
the blocked amount, then the insurer shall use the
to earn interest as per the extant legal provisions
facility to modify such mandates through one-time applicable to banks;
consent / authorization from the prospect.
v. The said blocked amount shall be debited from the
iv. Modification in the original mandate shall be al- bank account only in case of acceptance of the pro-
lowed only one time and the time period of 14 days posal by the insurer and after communicating the
for such modification shall be from the date of origi- decision of acceptance to the prospect;
nal mandate for blocking the fund.
vi. Upon the insurer underwriting / acceptance of the
v. Blocking of the amount shall only be done after proposal, the insurer shall instruct the partner bank
taking necessary consent from the prospect as per to debit the premium amount from the blocked
applicable provisions and laws. amount in the bank account of the prospect and

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