The Insurance Regulatory and Development Authority (IRDA) is thinking of increasing the lock-in period for Unit Linked Insurance Policies (ULIPs) by two years to five years. The regulator said it would help to bring down mis-selling.
Speaking to reporters at the sidelines of one day seminar on insurance organised by Asia Insurance Post R Kannan, member, IRDA said that one of the major concerns for the industry is mis-selling, to address the issue the regulator is taking few important steps.
The regulator is considering to increase the lock in period of ULIPs to five year from the present three years this would reduce early lapsation and would benefit the companies since administrative and market cost will be recovered.
“We are waiting for the consensus on the issue,” said Kannan.
The regulator is also launching a portal in 6-9 months which would allow policyholders to get connect to the respective insurance companies through IRDA’s portal. The main purpose is to monitor claims, mine data and keep tracking on the companies during claim settlement.
IRDA is also in the process of brining out a white paper for Motor Pool. The main objective is to study the process and function of the pool, said Kannan.
Qurited about increase in loss of non-life insurers, Kannan added, general insurers are not pricing the products are properly they should shift to actuarial method of pricing. He noted, in 2008-09 general insurers have reported a underwriting loss – premium income minus claims outgo — of Rs 3,179 crore from Rs 2,309 crore, a year ago.
Commenting on the portability for health insurance, Kannan said, the regulator is planning for long term health insurance products that can be portable.
