To All the Insurers Dear Sir/Madam, Sub: Cash Acceptance Threshold for Premium/Proposal Deposit Remittances
We invite your attention to the following instructions included in the Anti Money Laundering (AML) guidelines detailing the ceiling limits for cash deposits in insurance transactions. It may be observed therefrom, that the instructions emphasize strict adherence to the ceiling, with the clear focus to check possible attempts of money laundering and consequently require compliance with both the letter and spirit of our guidelines: 3.1.8 “With a view to ensuring that premiums are paid out of clearly identifiable sources of funds, it has been decided that remittances of premium by cash should not exceed Rs. 50,000. It would be advisable for the companies to evolve even lower thresholds for cash transactions”. 3.1.8 (i) “Premium/proposal deposits beyond Rs. 50,000 should be remitted only through cheques, demand drafts, credit card or any other banking channels”. 3.1.8 (ii) “For integrally related transactions, premium amount greater than Rs. 50,000 in a calendar month should be examined more closely for possible angles of money laundering. This limit will apply at an aggregate level considering all the roles of a single person-as a proposer or life assured or assignee”. 2. The Authority is concerned on certain instances that have come to its notice wherein it was observed that the aforementioned clauses are being selectively interpreted by insurance companies for compliance on individual transaction basis and consequent splitting of the insurance policies/issue of number of policies to one or more entities has facilitated individuals to defeat the spirit of the AML guidelines. 3. All insurers are therefore advised that the cash acceptance thresholds should be applied as indicated and where there is possibility of the transactions being integrated through a single remitter, the insurer should refuse to accede to the requests for cash deposits. The Authority will be constrained to take serious action against the insurers where the violations of AML framework are permitted with their tacit approval.
Yours faithfully,
|
||
|
| ||