PFRDA has issued a circular for handling surrender requests for annuity issued to NPS subscribers by ASP’s

Jul 29, 2021 | by Avantis RegTech Legal Research Team

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Labour Compliance

The Pension Fund Regulatory and Development Authority of India (PFRDA) on July 22, 2021 has issued a circular for the handling surrender requests for annuity issued to NPS subscribers by ASP’s.

PFRDA has been receiving requests for surrender of annuity policies post its issuance from the annuitants (who were erstwhile NPS Subscribers) or from other intermediaries with whom such Annuitants were associated earlier as NPS Subscribers. The Surrender is of two types viz surrender due to the applicability of Old Pension in case of Govt Sector subscribers and surrender due to any personal reasons including critical illness.

In view of the above, ASPs may handle the surrender requests received from Annuitants and intermediaries including Nodal officers of Government Sector without referring to PFRDA, National Pension System Trust (NPST) or Central Record Keeping Agency (CRA). The Surrender requests can be handled based on the specific annuity scheme features, contractual terms, surrender clause and applicable IRDAI guidelines.

ASPs are also advised to deal those cases of surrender on their own, after conducting their own due diligence in line with the existing provisions of the contract entered with the Subscriber at the time of issue of annuity policy. They also need to ensure that the Annuitants are made well aware of the surrender implications.

[Circular No: PFRDA/2021/30/SUP-ASP/6]


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