Irdai asks insurers to launch more Covid-focused products

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August 28, 2020 12:50 AM

Corona Rakshak is a fixed benefit plan in which if policyholder is diagnosed with Covid-19 and hospitalised for three days, then a fixed amount (which is sum insured), will be paid by the insurance companies. The sum insured in this policy is from Rs 50,000 to Rs 2.5 lakh.

The regulator had allowed insurance companies to come out with Corona Kavach, which is an indemnity plan and will cover all the hospitalisation expenses.

Two pandemic specific insurance products — Corona Rakshak and Corona Kavach — have seen high demand from policyholders. Since its launch in July, more than 15 lakh lives have been covered under both insurance policies. Insurance Regulatory and Development Authority of India (Irdai), which will open window for filing applications under Regulatory Sandbox, has also urged industry to focus on products which will deal with current pandemic.
While speaking at Ficci’s 21st Annual Insurance Conference ‘FINCON 2020’, Subhash C Khuntia, chairman of Irdai said that, “More than 15 lakh lives have been covered under Corona Rakshak and Corona Kavach within a period of month. This shows there is a demand from customers for such products. We must design the products keeping in mind what customers needs.”

The regulator had allowed insurance companies to come out with Corona Kavach, which is an indemnity plan and will cover all the hospitalisation expenses that arise from novel coronavirus. It will ensure that hospitalisation expenses will be covered up to the sum insured. The sum insured in Corona Kavach policy is from `50,000 to `5 lakh.

Corona Rakshak is a fixed benefit plan in which if policyholder is diagnosed with Covid-19 and hospitalised for three days, then a fixed amount (which is sum insured), will be paid by the insurance companies. The sum insured in this policy is from Rs 50,000 to Rs 2.5 lakh. The policy tenure can be 3.5 months, 6.5 months and 9.5 months and the waiting period is 15 days. Recently, the insurance regulator also invited applications for second cohort of the Regulatory Sandbox. The window for filing of applications shall open on 15th September 2020 and close on 14th October 2020.

“Fintech companies in collaboration with insurance companies can also participate in Sandbox for innovative products and process. We will be happy if more emphasis will be given by you on how to deal with the current pandemic and post pandemic. We will be delighted if more proposals come to deal with present situation,” added Khuntia.

The insurance regulator has also encouraged the industry to come out with innovative products that are simple and transparent.  “There are government schemes like Pradhan Mantri Jeevan Jyoti Bima Yojana, Pradhan Mantri Suraksha Bima Yojana, among others. We should build on this platform and create awareness about the insurance through the country. If that happens, we can see higher insurance penetration in India,” said Khuntia. Currently insurance penetration is 3.76% of the gross domestic products (GDP) compared to the world average of around 7%.

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