Retailers and manufacturers have created an illusion of need for such warranties in the minds of consumers, making them easy targets. Since these types of contracts are, in the law, indistinguishable from contracts of insurance, it may be time for the insurance regulator to wake up and take a cue from their British counterparts to start regulating a product that has so far remained under its radar.
Perhaps the Irda (Insurance Regulatory and Development Authority) would be inspired by the immortal words of the Bard of Avon: “What’s in a name? That which we call rose. By any other name would smell as sweet.”
By Kaushalya Shetty, Nidhi Killawala & Murali Neelakantan
Kaushalya is a Senior Associate; Nidhi is an Associate and Murali was, till recently, a Partner in the Corporate/M&A team at Khaitan & Co