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In a recent circular, IRDAI has issued guidelines for life and general insurers for rural, social sector and motor third party obligations. All life and general insurers are required to meet these obligations to ensure deeper penetration of life and general insurance across demographics and social class.
The guidelines for each are as follows:
Obligations for rural sector
- All life and general insurers will have to insure a minimum percentage of lives in the rural areas as specified by the Life Insurance Council and the General Insurance Council.
- The Life Insurance Council and the General Insurance Council after consultation with Ministry of Panchayati Raj will indicate minimum number of Gram Panchayats in all states and union territories to each insurer based on market share or any other relevant parameter.
- Once the insurers finalize the gram panchayats of their choice in states for fulfillment of these obligations, they will have to share it with the Life Insurance Council or General Insurance Council by May 15 of every year
- To check compliance, the councils will devise a common format of certificate about the details of the lives/dwellings, shops and motor vehicles insured by the insurers in a gram panchayat. This certificate will be issued on a quarterly basis.
Obligations for social sector
- Every life and general insurer will insure a minimum number of lives/dwellings, shops and motor vehicles from the social sector.
- The Life Insurance Council and the General Insurance Council will coordinate with various government agencies to collate data for social sector population and share with life and general insurers.
- Every insurer will report the number of lives/dwellings, shops and motor vehicles insured within 30 days of end of each quarter to IRDAI.
- To check compliance, the insurer shall make arrangements to record the policies under the social sector.
Obligations for motor third party
- Every general insurer will insure a minimum number of goods carrying, passenger carrying vehicles and tractors.
- The insurers can engage with the Insurance Information Bureau (IIB) and state RTAs to prepare a list of the uninsured of goods carrying, passenger carrying vehicles and tractors.
- The General Insurance Council will also coordinate with IIB and state RTAs to obtain the required data.