Insurance regulator asks general insurers to offer long-term policies

The Insurance Regulatory and Development Authority of India (IRDAI) has asked general insurers to offer long-term policies, especially with three different segments forming the majority of the business. These three segments are motor insurance, health insurance and property insurance.

A 21-member working committee has been formed for the same. This working committee has representation from the general insurance industry, from the regulatory side and from the banking side.

The committee essentially expected to give its recommendations and suggestions to the insurance regulator in terms of what could be the structure, how would the long term products in all these three segments work as well as what could be the pricing and accounting mechanism.

This move will help policyholders to stay with one insurance company for the long-term. The possible indication from the industry is that there could be 10-year motor insurance policies, health insurance policies and property insurance policies.

This committee is expected to give recommendations to the regulator. Once that is collected by the regulator then final regulations will be formed in terms of how these products could look like.