Bajaj Allianz Life Goes Live With Bima-ASBA Facility: Here's How It Works

Bajaj Allianz Life, a private life insurance company, has launched the BIMA- Application Supported by Blocked Amount facility, becoming the first insurer to facilitate this new premium payment feature as mandated by the insurance regulator. The Insurance Regulatory and Development Authority of India (Irdai) recently introduced this payment feature to bring operational ease, enhance policyholder convenience, and simplify the insurance premium payment process.

What is Bima-ASBA?

A step to make premium payments easier for policyholders, this facility uses the Unified Payment Interface (UPI) to secure your funds meant for premiums.

Using this facility, policyholders will be able to authorise insurers to block a specific amount in their bank accounts before their insurance proposal is accepted. This means that the funds remain available in your account but cannot be utilised for other purposes or deducted until the insurer decides on the application.

How Does It Work?

Under this Irdai initiative, policyholders will be able to opt for UPI’s One-Time Mandate (OTM) and authorise the blocking of a specified amount (up to Rs 2 lakh) in their bank account via UPI.

The amount will be debited only after the insurance company completes the underwriting process and decides to accept the proposal.

If the application is not processed within 14 days or the proposal is not accepted, the blocked amount is automatically released back to the customer.

This initiative ensures that the policy buyer’s funds remain in their bank account and continue to gain interest till the time the policy issuance is confirmed. Bajaj Allianz Life, in partnership with its payment partners, has successfully launched this process.

Says Tarun Chugh, MD and CEO, Bajaj Allianz Life, "In line with the vision of ‘Insurance for All by 2047,’ Irdai is taking commendable steps toward enhancing transparency, trust, and digitization for customer convenience. These measures are designed to further benefit customers by strengthening the insurance ecosystem. We welcome Bima-ASBA as a significant step in this direction.”

Other insurers will soon follow the lead to implement this facility in their respective companies. According to Irdai's circular issued on February 18, 2025, all insurers will need to offer the Bima-ASBA facility by March 1, 2025.