Stressing the need to reach insurance products to each and every Indian, the Insurance Regulatory and Development Authority of India (IRDAI) Chairman, T.S. Vijayan on Friday asked insurance companies to distribute easy to understand and easily claimed products.
“The trick is to make appropriate schemes easy for customers to understand and if the need arises, to claim it,” Mr. Vijayan said at the 17th edition of CII’s Insurance Summit, here.
“The purpose of the industry is to cover risk and ride on platforms already created. The insurance products launched by the Prime Minister did this by responding to the ecosystem available. The industry needs to do the same,” he added.
According to Mr. Vijayan, the insurance schemes launched by the Prime Minister, created the kind of growth in months what has taken the insurance industry years. “There is a hint in it as to what the industry needs to do to create growth and appropriate value.” He said that value was determined by how the money that a customer is paying, is apportioned to cover distribution cost, capital cost, processing cost and others and how much of it goes to balance premium for the purpose it is paid.
“The proper appropriation of the proportions for all stake holders will ultimately determine value for everyone. At IRDAI, disruption is not our aim. We want to bring about gradual changes to give value to all stake holders,” Mr. Vijayan said.
Asking companies to expand the market he said, “there is enough money. Companies should work to aggressively expand the market. If they are reluctant to do that, we might need to look at alternate ways. Because India needs insurance, people need insurance.”
Highlighting Prime Minister’s insurance schemes, he said that audiences respond to simple schemes where they can clearly know the conditions, what they are paying and how they can claim it.
He also said the ecosystem created by the Prime Minister’s schemes would enable the insurance companies to increase the vital matrix of Sum at Risk as a percentage of GDP, which currently is around 70 per cent whereas in developed countries like Japan, this ratio is as high as 350 per cent.
Final guidelines for reinsurers by OctoberPTI adds:
IRDAI on Friday said it was working on the final guidelines for reinsurers, which would come out by October.
“About 7 to 8 global and domestic reinsurance players have shown interest for licence to begin operations in the country so far. We are working on the guidelines. We will come up with the final guidelines by October,” IRDAI Chairman told on the sidelines of the Summit here.
