The Insurance Regulatory and Development Authority of India (IRDAI) has issued a directive that prohibits insurers from advertising unit-linked insurance policies (ULIPs) as investment products. This regulation is part of a broader initiative to ensure that consumers have a clear understanding of ULIPs’ primary purpose, which is to offer insurance protection rather than serve as an investment vehicle.
IRDAI’s new advertising guidelines require insurers to clearly articulate the insurance components and benefits in their advertisements. This move is intended to promote transparency and prevent misleading advertisements that may confuse policyholders about the true nature of ULIPs.
The guidelines specify that insurers should avoid any emphasis on the investment aspect of ULIPs in their marketing materials. Instead, the focus should be on the insurance coverage and protection that these policies provide. By doing so, IRDAI aims to protect consumers from potential misunderstandings and ensure they make well-informed decisions when purchasing insurance products.
These measures are part of IRDAI’s ongoing efforts to enhance consumer protection and trust in the insurance sector. By mandating clear and honest advertising practices, the regulator hopes to create a more transparent and reliable insurance market.
