Irdai proposes changes in norms for insurance products

Insurance regulator Irdai Friday proposed tweaking norms for different insurance products including those related with payment to nominees in case of death of policy holders.

Irdai had constituted a 'Committee on Review of Product Regulations Life' for reviewing the 2013 regulations on Linked Insurance Products and Non-Linked Insurance Products.

The panel was set up as there have been significant changes in the trends in product structures driven by the customers' needs, wants and preferences since 2013.

Industry was also representing to review the various provisions of the current product regulations to ensure insurance products cope with the dynamism of the market.

Later, a working group was constituted to consider the recommendations of the committee and the feedback received thereto.

In its exposure draft, the Irdai has proposed to make several changes in the existing regulations.

"Minimum death benefit has been made 7 times for regular premium products and 1.25 times for single premium products for all ages" is among the the key changes proposed to the current regulations.

Currently, the minimum payment on death depends upon the age of the insured person.

Irdai also proposes to extend the revival period for non-linked policy products to 5 years from the current 2 years.

"Insurers can now design individual term, group term and credit and micro insurance products which offer a range of policy terms," is also one of the key change proposed in the current regulations.

The regulator has invited comments on the exposure draft till November 15.