Insurance industry regulator IRDAI has extended the “use and file” procedure for new products to life insurance companies. The regulator had allowed similar benefits on almost all health and general insurance products.
“This means now the life insurance companies can also launch these products without prior approval of IRDAI. This comes after the similar relaxations were extended to all the health insurance products and almost all the general insurance products by the IRDAI vide a circular dated 01.06.2022,” the regulator said in a statement on Friday.
Earlier, it was mandatory for the insurance companies to take prior approval before launching any life insurance product. “This move will enable life insurers to launch most of the products (except individual savings, individual pensions and annuity) in a timely manner according to the dynamic needs of the market. This will result in improving ease of doing business for the insurers and also lead to expansion of the choices available to the policyholders,” the statement said.
The IRDAI circular, however, requires the life insurers to have a board approved product management and pricing policy. Besides, there should be a product management committee, which shall have an appointed actuary, chief risk officer, chief marketing/distribution officer, chief technology officer and chief compliance officer of the insurer as members and also an option to include other members of its senior management as invitees. The panel will review and approve the products and riders in line with the set policy.
“The life insurance industry is expected to use this opportunity to respond faster to the emerging market needs, in terms of designing and pricing of products resulting in more choices for the policyholders,” which will further help in increasing the insurance penetration in India,” the regulator said.