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Often prospects do online research and find the policy you offered at cheaper price elsewhere. However, this will not happen now.
IRDAI has asked insurance companies to offer uniform premium in life insurance policies across all distribution channels. With this, the premium amount of life insurance policies will be similar for insurance brokers like policybazaar.com and insurance agents.
IRDAI said, “The premium rates/charges are equitable between policies sold through different distribution channels.”
However, insurance bought directly through insurance companies will be available at discounted price because of absence of brokerage component.
Here are other key highlights of the new life insurance regulations:
- All life insurers will have to offer loan against insurance policies. However, only savings products are eligible for loans
- All life policies should offer health riders to cover health related contingencies
- Pension products will allow partial withdrawals to meet specific financial needs like higher education and marriage of children, purchase or construction of house, medical expenses and treatment of critical illness
- Surrender value should be reasonable and ensure value for money
- Insurers should offer index linked ULIPs
- Free look period increased to 30 days
- Insurers will have to pay penalty of Rs.5000 per day if they do not implement order of ombudsman within 30 days
- Insurers to put in place a mechanism to improve persistency, curb mis-selling and avoid financial loss to the policyholders
- Intermediaries should be trained periodically to improve product servicing
- Premium rates should be fair
IRDAI has also asked insurers to make things simple and transparent. It said, “Underlying principles of simplification and transparency in insurance enables a well-informed decision by a prospect/policyholder. It minimises policyholder grievances; enhances customer satisfaction and confidence. It goes a long way to improve insurance penetration while also providing an inclusive, equitable and diversified insurance for all.”
