The Insurance Regulatory and Development Authority of India (IRDAI) has issued a new circular on general insurance to simplify various insurance processes and improve the overall customer experience. The latest master circular will also repeal 13 older circulars.
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The changes include the following:
1.No insurance claim shall be rejected for want of documents
The IRDAI wrote that required documents are to be called at the time of underwriting the proposal, and that the customer may be asked to submit only those documents necessary and related to claim settlement (if cashless is not available).
“Ensuring that no claim is rejected due to insufficient documentation shifts the burden of proof onto insurers during the underwriting process, Narendra Bharindwal, vice-president of Insurance Brokers’ Association of India (IBAI) told Moneycontrol. “This change simplifies the claims process for policyholders, reducing administrative hurdles and expediting claim settlements, which enhances the overall customer experience.”
2.Introduction of a Customer Information Sheet (CIS)
This is to provide clear and concise policy details including scope of coverage, exclusions, warranties, and claim settlement processes.
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3.Wider choices of products and add-ons
The IRDAI gives customers, the ability to customize the products and choose products as per their needs. Additional options include “pay as you drive”/ “pay as you go” for motor insurance. The “fire” policy gives homeowners an option to choose add-on covers such as flood, cyclone, earthquake, landslide, rockslide, terrorism or to opt out from comprehensive fire and allied peril policy.
4.Policy cancellations
Retail customer can cancel the policy anytime by informing the insurer. Insurers can cancel the policy only on grounds of established fraud. The insurer shall refund proportionate premium for the unexpired policy period on cancellation.
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5.Strict timeline for claim settlement
The IRDAI will use a tech-based system for delegating surveyors within 24 hours of the claim being reported, and they have 15 days to prepare the report. The insurer will have 7 days to settle or reject the claim after receiving the report.
