Regulator Irdai on Wednesday allowed insurers to launch health and most general insurance products without its prior approval, a move aimed at having a fully insured India.
The Insurance Regulatory and Development Authority of India (Irdai) has extended the “Use and Deposit” procedure to all health insurance products and almost all general insurance products in line with the reform program undertaken to have a fully India assured, the regulator said in a statement.
“This is a stepping stone towards improving the ease of doing business in the insurance industry from the current regime requiring pre-approval for product launch to a regime where products could be launched without any prior approval,” he said.
The regulator further said that it is expected that the initiatives will enable the insurance industry to launch appropriate products in a timely manner.
The insurance industry is expected to seize this opportunity to introduce customized and innovative products and expand the choices available to policyholders to meet the dynamic needs of the market, which will further contribute to improving insurance penetration in India, a- he added. .
Commenting on Irdai’s decision, Bajaj Allianz General Insurance MD and CEO, Tapan Singhel, said the regulator’s proactive initiative will provide some necessary mechanisms for insurance companies that want to bring more innovative products to market at a frequency faster.
“The use and file procedure essentially means that insurers can introduce their products to the market upon filing with the regulator, thus avoiding a long waiting period to offer innovative insurance solutions to customers to help them cope with the dynamic environment,” he said.
Kapil Mehta, co-founder of SecureNow, said Irdai’s decision will encourage insurers to launch a variety of products more often.
“An excellent step in my eyes,” he added.
Shanai Ghosh, executive director and CEO of Edelweiss General Insurance, said the announcement has empowered insurers as the entire product approval and launch process has been simplified, responding to a major challenge faced by insurers.
“While this decision provides for the rapid introduction of innovative products, insurers will now have a greater responsibility to ensure robust product development and pricing as well as policyholder protection,” Ghosh added.
Under the amended guidelines, Irdai has authorized general insurers to classify all products in the fire, marine, automotive and engineering lines of business under the ‘Use and Classify’ procedure for retail and commercial categories.
This, Irdai said, is intended to help the industry respond more quickly to the needs of emerging markets, in terms of the design and pricing of general insurance products and to promote efficiency in the conduct of general insurance business. .
In another circular, the regulator said that all categories of products and add-ons or endorsements to be introduced or amended/revised within the framework of the health insurance business and offered by insurance companies general and health insurance are allowed to be started via “Use and File”. However, they will have to meet certain other standards.
All product categories (pilot products, health plus life combo products and health products) can also be launched under the “Use and deposit” procedure.