Irda reduces waiting time for life risk firms

The Insurance Regulatory Development Authority of India (Irda) has shortened the waiting period for life insurance companies for offering products.

As per the existing procedure, after filing of the products, life insurers can use the product only if they do not hear anything from the Irda within 30 days from the date of receipt of application.

In view of the difficulties faced by insurers, Irda has decided to reduce the waiting period to 15 days with respect to the filings, said the Irda website. This means that if insurers do not hear from Irda within 15 days from the date of receipt of application, insurers can offer sale of such products.

All individual non-linked products with revisionary bonus, both participating and non-participating, where the products are simple endowment assurance, whole life assurance, money back assurance, term assurance and immediate annuities with a minimum policy term of 5 years will enjoy the reduced waiting period.

However the conditions are that these products should not be attached with riders other than accident benefit and permanent disability; in case of lapses, the products should offer a revival period of at least two years.

Also the products should not be modified in any regard for at least six months from the date of filing with the authority.

After the launch, insurers have to furnish the soft copy of the scanned file and use documents.

However for all other types of products such as ULIPs, insurers will have to wait for 30 days and can launch the product only if they do not hear from Irda till 30 days. Irda has also asked life insurers to give a unique number to all individual, group products and riders and to quote the number in all the relevant documents that they furnish to policyholders, distribution channels and also in the statutory returns filed with the Irda.