The finance ministry is contemplating changes in insurance Law including reduction in minimum capital requirement with a view to increasing the insurance penetration in the country. Insurance penetration increased from 3.76% in 2019-20 to 4.20% during 20-21 registering a growth of 11.70%. IRDAI is aggressively pushing for an increase in penetration and has given all Insurers individual targets to achieve the same in a time bound manner. IRDAI is also reviewing existing regulations and trying to make it more industry friendly and follow the structure of principle based regulation.
The Regulatory Authority is also considering a recommendation to set up one independent investigation agency to probe cases of Insurance Fraud. This agency, if formed, shall be similar to the Serious Fraud Investigation Office (SFIO) which probes corporate fraud and comes under the Ministry of Corporate Affairs (MCA).
Renowned businessman Cyprus Mistry’s death in a car crash recently has brought the risks related to road travel into the national spotlight. The ministry of Road transport has now made it mandatory for rear passengers to wear the seat belts. The number of deaths due to accidents is more than the loss of life due to pandemics. This needs greater attention from every one as thousands of people lose their lives in road accidents and eyebrows are raised only when any well known person dies. More awareness programmes should be arranged through social organisations and the Insurance Companies must take lead in this initiative.
IRDAI may soon come up with a new norm with respect to changing an insurance agent. In order to enhance customer experience, and make services better and more convenient for the policy buyers, the insurance regulator is planning agent portability options. This will help policyholders whose agents leave the agency profession or who do not service the existing client properly.
IRDAI has also mandated dematerialisation of new insurance policies by this year-end. It has urged all insurance companies to dematerialise their existing or old policies by December-end, industry experts have said. This may save a huge cost. But still the Insurance Companies must send a copy of summarized policy covering all important inclusions, exclusions and do’s and don’ts in the policy.
