Question

In case of delay in the payment of the claim amount, at what rate should the insurer pay interest?

a.

Equal to the bank rate

b.

1% above the bank rate

c.

2% above the bank rate

d.

5% above the bank rate

Answer: (c).2% above the bank rate Explanation:In case of delay in the payment of the claim amount, the insurer should pay interest at a rate which is 2% above the bank rate prevalent at the beginning of the financial year in which the claim is reviewed. This serves as compensation for the delay and encourages timely claims settlement.

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Q. In case of delay in the payment of the claim amount, at what rate should the insurer pay interest?

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