New Delhi, January 29, 2021: The Insurance Brokers Association of India (IBAI), the apex body of licensed insurance brokers, at its 17th Annual Insurance Brokers’ Summit today, emphasized the role of brokers as representatives of their customers to help them get the right product at optimum cost, protecting the interest of the policyholders.
The theme for the summit is ‘Insurance Brokers – Innovate, Evolve, Thrive – Advancing penetration, Enhancing Policyholders Interest”. The objective of the Association is to educate the prospective and existing policyholders to be well informed before finalizing the respective insurance contracts. This will protect the insured from poor claim settlements from the insurer.
At the virtual Summit, Insurance Regulatory and Development Authority of India (IRDAI) Chairman Dr. Subhash Chandra Khuntia released the 5th edition of the ‘IBAI General Insurance Claim Insights for Policyholders Handbook’. The claims handbook covers the claims related ratios pertaining to Fire, Marine, Motor, Health and Miscellaneous lines of business in addition to the overall claims by all non-life insurance companies in India with the exception of a few specialized insurers.
The handbook analyzes different parameters related to claims from publicly available data for different insurers, both public and private for the financial year ended March 31, 2020. This compilation of the claims settlement data of various insurers is not available elsewhere and has been collated from individual websites of each insurer. It is one of the first such initiatives to look at insurance transactions in the country from a claims perspective, i.e., from the point of view of policyholders. Insurance brokers, as representatives of policyholders’ interests are uniquely positioned to undertake this initiative.
The fifth edition of the handbook shows a positive trend when it comes to the overall claims settlement ratio which is an important indicator for policyholders to make an informed decision while entering into an insurance contract. The association believes, the handbook will provide a comprehensive resource for policyholders to objectively compare one insurer with another on their claims settlement history.
The claims settlement ratio for the entire industry remained stagnant at 85.18%, analysis for the financial year ended March 31, 2020, however the claim repudiation ratio has improved from 7.47% to 4.09%. The Special Policy for COVID-19 i.e. COVID Rakshak and COVID Kavach, which was introduced by all the insurers under the able guidance of IRDAI got an overwhelming response and almost 70 lakhs lives were covered under the scheme.
The purely data-driven analysis takes into account only the number of claims and not the claim amounts. Claim amounts are not disclosed in insurers’ publicly available data. The association believes that if the corresponding claims amount are also disclosed in line with most international practices then policyholder will have much richer insights on the claims performance of the insurance companies.
Mr. Sumit Bohra, President, Insurance Brokers Association of India (IBAI) said, “In the past decade, the Indian non-life insurance industry has really come into its own with over INR 1.89 lakh crore placed in premium during 2019-20, registering a growth of 10.58 % on a year-on-year basis. For the industry to further thrive and get to the next level of growth, it is imperative that insurance penetration grows to a level comparable to the more developed insurance markets.”
“For the Insurance market to prosper, intermediaries play a key role as they are directly associated with the customers and know their requirements and Risk management philosophy. As brokers, we tailor make the solutions depending upon the clients’ businesses and make sure they get the right product at the right price. The role of the brokers does not end with sales but continues in handholding the client to get his rightful claim in the shortest possible time. We intent to provide solutions in the favor of the policy holder’s interest and therefore, would like to work with IRDAI to ensure that every policy designed fills the gap between the actual insured loss and the claim payment is narrowed to the bear minimum.”
“Post the pandemic the role of brokers has enhanced as the nature of Risk has changed and customers would definitely expect a blue ocean strategy to cover such future effect of the pandemic. We as Brokers are constantly thriving to make sure that we provide the best possible insights from across the spectrum so that customers are protected from future risks,” added, Mr. Bohra.
On the occasion, Mr. Subhash Chandra Khuntia, Chairman, Insurance Regulatory and Development Authority of India (IRDAI) said, “Use of digital tools will play a key role in this new normal. The broker community should make optimum use of digital platforms to reach out to the stakeholders and customers, and to also enhance engagement”. He further added, “I see a huge opportunity in the tier 2 and 3 cities and towns. Substantial economic growth is expected from rural areas and I would urge the broker community to penetrate this untapped segment. Further focus is required on the MSME sector and new insurance products have been added to cater to this.”
Mr. Khuntia further “emphasized the need to support and train the relatively smaller brokers so they can realize their full potential and contribute to the growing community. Currently, there are 482 active brokers in the country”.
The Summit was attended by more than 500 delegates including CMDs and CEOs representing India’s top life and non-life Insurance companies, IRDAI members, insurance brokers, insurance companies, TPAs, Loss Assessors, customers and other stakeholders.
At the 17th Annual Brokers Meet, IBAI also launched a social media campaign #Insurancebrokers, which intends to connect with the youth and educate them on the importance of Insurance. The campaign was launched on Twitter, Linkedin and Facebook.
About IBAI:
Insurance Brokers Association of India (IBAI) is the only Insurance Regulatory and
Development Authority of India (IRDAI) recognized apex body of licensed insurance brokers. As per IRDAI (Insurance Brokers) Regulations, 2018 framed by the IRDAI, all licensed brokers are required to be members of IBAI. As on 1st January, 2021 there are 483 insurance brokers in India, which includes direct insurance brokers, composite insurance brokers and re-insurance brokers.
