T o enhance transparency in unit-linked insurance products (Ulips) and protect the interest of policyholders, the Insurance Regulatory and Development Authority (Irda) has asked life insurers to disclose the underlying conditions and elements while advertising products.
“A review of the advertisements, especially those relating to unit-linked life insurance products, reveal the necessity to improve the content and presentation in compliance with the provisions of the above referred regulation and guidelines,” said Irda.
The regulator said when an insurance advertisement is highlighting the benefit of guarantees, it clearly needs to disclose the underlying conditions under which the guarantee operates, including cost of guarantee and charges.
Further, Irda said if the underlying conditions are very elaborate, the text, wording on guarantee must be accompanied by the phrase “Conditions Apply” in a font that is at least 50 per cent of the font size used to highlight the guarantee.
The advertisement will also have to clearly state the availability of underlying elements of ‘life insurance coverage’ to help identify the product as an insurance product.
It has warned against brand names of products that use terms or phrases that convey a fabricated sense of security.
