IREC Rule No.932: Insurance Policy From The Provident Fund
632. Insurance Policy From The Provident Fund:-
(1) The policy within 6 months after the first withholding of a subscription or withdrawal from the fund in respect of the policy shall;
(a) Unless it is a policy effected by a male subscriber which is expressed on the face of it to be for the benefit of the wife of the subscriber, or of his wife and children, or any of them, be assigned to the President, as security for the payment of any sum which may become payable to the fund under these rules, and delivered to the Accounts Officer, the assignment being made by endorsement on the policy in the prescribed form, according as the policy is on the life of the subscriber and the subscriber’s wife or husband or the policy has previously been assigned to the subscriber’s wife;
(b) If it is a policy effected by a male subscriber which is expressed on the face of it to be for the benefit of the wife of the subscriber, or of his wife and children or any of them, be delivered to the Accounts Officer.
(2) The Accounts Officer shall satisfy himself by reference to the Insurer where possible, that no prior assignment of the policy exists.
(3) Once a policy has been accepted by an Accounts Officer for the purpose of being financed from the fund, the terms of the policy shall not be altered, nor shall the policy be exchanged for another policy, without the prior consent of the Accounts Officer to whom the details of alteration or of the new policy shall be furnished.
(4) If the policy is not assigned and delivered, or delivered within the said period of 6 months or such further period as the Accounts Officer may, under sub-rule (1), have fixed, any amount withheld or withdrawn from the fund in respect of the policy shall, with interest thereon at the rate determined under Rule 920, forthwith be paid or repaid, as the case may be by the subscriber to the fund or, in default, be ordered by the Accounts Officer to be recovered by deduction from the emoluments of the subscriber, by installments or otherwise, as may be directed by the authority competent to sanction an advance under Rule 923.
(5) Notice of assignment of the policy shall be given by the subscriber to the Insurer, and the acknowledgement of the notice by the Insurer shall be sent to the Accounts Officer within three months of the date of assignment.
Note: Subscribers are advised to send notice of the assignment to the Insurer in duplicate.