It is a common practice in India that agents miss-sell a policy. It is also seen that insurance companies reject genuine claims. There are many such malpractices in the industry which leaves the insured helpless. In order to safeguard the interests of the policyholders, IRDAI (Protection of Policyholders’ Interest) 2017 which are major changes to the last reforms introduced in 2002.
The main highlights of this reform are:
- All insurance companies will need to have a policy approved by the board to protect the interest of the policy holders which will cover various aspects like, turnaround time and service standards, steps to increase awareness of products offered by them, a process to solve complaints at the earliest and steps to avoid miss-selling of products.
- The services and the turnaround time for each of these will need to be published on the website
- In the product’s prospectus, some information needs to be compulsorily given like cover, benefits, coverage, exclusions, riders and discounts, if any.
- The proposal form will need to clearly mention the prerequisite of the Section 45 of the Act that on grounds of misstatement, the policy shall not be called in question.
- Some minimum standards have to be followed by all companies to standardize the policies.
- Within 15 days the insurance company has to process cancellations of the freelook period
- A detailed guideline has been given by IRDAI for claim settlement
- Compete requirements of Grievance Redressal Process coverage have been given
The Authority has listed various ways to help the policy holder and ensure they are not harassed by insurance companies.