The number of days taken by an insurance company to issue a term life insurance policy has gone up in April and May. A combination of factors such as the time taken to obtain a medical report and tightening of guidelines by the reinsurers led to the delay.

Insurance intermediaries and aggregators said that normally it would take around 10 days on an average to get a term life insurance policy issued from the submission of a proposal form. This has gone up to around 15-16 days over the last couple of months.

Once the documents are submitted, verified and payments made, prospective buyers are required to undergo either a physical medical test or a telemedical test.A co-ordination team from the insurance company sets a date for the tests to be done at home or diagnostic centres.

The tests may range from ECG, blood sugar to TMT for people in a higher age bracket and cotinine tests to evaluate tobacco use. If an individual has declared a past ailment, additional tests may be required.

“There are multiple factors such as age, sum insured, past ailments, family ailments, existing insurance policies which are taken into account to determine whether a telemedical check-up is adequate or a physical check-up is needed,” said Sajja Praveen Chowdary, business head, term life insurance, Policybazaar.com

With re-insurers tightening regulations in the Covid pandemic, many insurance companies are preferring a physical check-up before issuing policies. But the diagnostic centres are under stress because of the pandemic, while there is a paucity of lab persons to do the check-ups at homes. This has increased the time taken to obtain the reports which has led to the delay in the issue of the the term policies.

The delay, however, has not impacted the growth rate both in the number of policies issued or new business premium collected net of free-look cancellation.

According to Irdai data, while the number of policies in April and May has gone up by 30.40 per cent, premium has gone up by 11 per cent for the entire industry, including 23 private players and LIC, over the corresponding months of the previous year.