The money is from policies that had matured but remain unclaimed, according to the Life Insurance Association of Malaysia (LIAM).
Last year alone, about RM64mil was submitted by its member companies to the Registrar of Unclaimed Money which is under the Accountant-General’s Department, it said.
In a statement to The Star recently, LIAM said this was the total value of “516,728 matured life insurance policies (that) have been forgotten by the policyholders and their beneficiaries”.
It found that in 2012, member companies submitted nearly RM80mil to the Registrar, followed by RM54mil in 2013, RM67.5mil in 2014, and RM61.5mil the year after. LIAM has 16 member companies.
As per the Unclaimed Monies Act 1965, companies must submit a record to the Registrar by the end of March every year, detailing unclaimed amounts from the year before.
LIAM also said that almost all the policyholders affected by this issue were unreachable, mostly because of outdated contact information.
“Continuous attempts would be taken to contact policyholders or beneficiaries before the mandatory submission to the Registrar is due,” it said.
“Mandatory submission as per the law is usually one year after the cheques issued in their names are returned and all efforts to contact the claimants have failed.”
One member company, Etiqa Insurance Bhd, noted in a separate statement that there were RM13mil worth of lost and forgotten policies within Etiqa itself.
Maybank Ageas Holdings Bhd, the parent company of Etiqa Insurance, noted that many people are unaware that their policies or certificates have matured.
“We have a team dedicated to identifying policy and certificate holders who have died and then undertake a systematic search for their beneficiaries,” said Maybank Ageas chief executive officer Kamaludin Ahmad.
He said that while relatives of the deceased have to go through a lot of trouble gathering the proof and documentation needed to recover the money, “this provides a good learning opportunity to spare the next generation from having to hunt down unclaimed life insurance or family takaful benefits”.
After insurance companies submit unclaimed monies to the Registrar, no further attempts are made to contact the policyholders or beneficiaries.
As such, LIAM urges policyholders to sign up for an e-payment system by providing an active bank account number to their life insurance companies.
“Once an e-payment account has been set up, insurance companies will transfer their maturity proceeds, claims payments and dividends into their bank accounts.
“Policyholders are also encouraged to update their personal details like addresses and contact numbers, and sign up for an online account to access their policy details,” it added.
Source: The Star (5 July 2017)