The draft regulations for the creation of a regulatory sandbox was taken by the Insurance Regulatory & Development Authority of India (IRDAI) on May 18, 2019, to allow a conducive environment for insurtech and fintech companies to carry innovation in the insurance space.
The insurance regulator has proposed the regulatory changes for encouraging the use of new technology as a part of the insurance sector. The IRDAI has also constituted regulatory reforms for examining innovations in the use of wearable /portable devices in the insurance sector.
To ensure the InsurTech Sandbox, the Sandbox Committee has taken into account the regulatory issues involved in the use of technology, the methods adopted by regulators and the feedback from the insurance sector.
Few of the products which are approved by the Sandbox Committee are motor insurance on the basis of distance, health profile-based pricing, wearable fitness tracker, health insurance and co-pay model, AI-based apps and others.
Currently, the premium of a motor insurance policy is dependent on the model of the vehicle. How well it’s going to be if one gets the insurance cover for distance traveled by car. Through this Sandbox insurance policy, the premium would be charged based on kilometers or the amount of time the car is driven.
One of such startups – Letstrack, a vehicle security system is happy to hear the new test products by the insurance regulator.
Started and based at Stratford, East London, UK, with a vision to make our society safer, happier and more productive, Letstrack has launched its app and devices in India for B2C and B2B consumption that will change the way we do things in our everyday lives.
Expressing his views about the same, Vikram Kumar, Founder & CEO, Letstrack, said, “This will set a new pace to the already booming tracking based analytics industry. We are working with lots of financial institutions and insurance companies but now it will make sense for all the insurance companies to use our expertise in the field of data analytics.”