Irdai sets up 12-member committee to simplify insurance policy wordings
Mumbai, Oct 27, 2023
This comes in the backdrop of the Irdai's observation that policyholders often find it difficult to understand the terms and conditions in insurance policy contracts
The Insurance Regulatory and Development Authority of India (Irdai) has constituted a committee of 12 members to simplify insurance policy wording.
The committee, which will be headed by L Viswanathan, a member of the Insurance Advisory Committee (IAC), will also include the Secretary Generals of the Life Insurance and General Insurance Council along with the president of the Insurance Brokers Association of India (IBAI) and the Principal Officer, State Bank of India (Corporate Agent) as well as other senior members of the insurance industry. Further, the committee can also include external experts if found necessary.
This decision comes in the backdrop of the Irdai's observation that policyholders often find it difficult to understand the terms and conditions in insurance policy contracts due to the complex language used in the policy, stopping them from making informed decisions while purchasing an insurance policy.
As a step towards Irdai's goal of Insurance for all by 2047, the regulator is putting efforts towards creating a progressive, supportive, facilitative and forward-looking architecture, which will foster a healthy environment leading to wider choice, accessibility and affordability to the policyholders.
"In this endeavour a committee with following members is constituted for simplification of policy wordings by using language understandable to policyholders," the regulator's statement said.
According to the terms of reference given to the committee, they have to examine the existing policies and give plain words that are legally correct and enforceable, which clearly specify the obligations and responsibilities of the parties involved in the contract. It can also suggest specifications like typefaces for written material.
The committee is expected to submit its recommendations within 8-10 weeks.
[The Business Standard]
