ACCIDENT COMPENSATION

Know how to get annuity income from
claims money

MOTOR ACCIDENT CLAIMS Annuity (Term) Deposit Account (MACAD) is offered by several public sector banks to make it easier for road accident claiments to deposit compensation received from Motor Tribunals. The scheme facilities repayment of deposited amount in monthly annuity instalments that include a part of the principal amount plus interest.

Here are five things to know about MACAD accounts offered by the State Bank of India (SBI), Punjab National Bank (PNB) and Bank of Baroda (BOB).

Interest rate: PSBs are offering varying interest rates on MACAD deposits. PNB is providing 1% above the card rate of interest as applicable for normal fixed deposit scheme of various tenors. In the case of SBI and BOB, prevailing card rate of interest as per the tenure is applicable.

Interest and annuity payment

The interest earned on MACAD account deposits is paid on a monthly basis. PNB’s website says that the monthly interest will be paid at a discounted rate. At SBI, the payment of the annuity starts on the anniversary date of the month of the deposits. The BoB website says that the payments of the annuity (part principal & interest) amount will be credited to the linked MACT Claims SB account.

The tenure of MACAD account in SBI is 36-216 months as per directions of the tribunal/court. In BoB, deposit can be made for 36-123 months. PNB allows MACAD account holders cannot apply yfor loans or advances against the annuity deposit.

Premature closure

Premature closure of MACAD accounts is not allowed by most banks. This is no because the scheme aims to protect the interest of children, windows and relatives of victims of road accidents in India. Courts have ruled that a large chunk of compensation money awarded by Motor Tribunals should be deposited in a bank account for a longer period.

The SBI website says that MACAD account holders can apply for premature closure or part lump sum payment. The amount will be provided through the linked savings bank account.

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