Setting high standards
Selecting a life or general insurance product may become simpler as the Insurance Regulatory and Development Authority (Irda) will soon come out with guidelines on 10 standard products for faster approvals. The standard products will be part of the ‘use and file’ process, which the finance minister had proposed in his 12-point package to revive the industry.
Currently, insurance companies, after designing a product, have to approach the regulator for approval. Under the ‘use and file’ process, if the insurer complies with the conditions attached to a standard product, such a product will automatically be deemed approved after 15 days of intimation to the Irda unless the regulator finds the product non-compliant within that time period.
At a health insurance summit, Irda chairman J Hari Narayan said standard products will be designed in consultation with industry bodies. “We will develop 10 standard products and will work closely with the Life Insurance Council and the General Insurance Council to see if we can develop such products,” said Hari Narayan.
Analysts say policyholders often find it difficult to choose from multiple products and even get confused between participating and non-participating products.
To make products simpler and improve the penetration of insurance in India, finance minister P Chidambaram had said that Irda will come out with a policy to accord automatic clearance to standard life insurance products.
“Irda will lay down guidelines on the
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