The
insurance companies are mandated to take prior approval from the
Insurance Regulatory and Development Authority (IRDA) of the product
before launching.
As
per File and Use Guidelines, the insurance companies are required to
launch products after allowing for 60 days for non-life and 30 days for
life for clearance by the IRDA. Several times, however, the full details
of the product, which are required in order to assess the product, are
not furnished and consequently there is delay.
The
time lag for this process depends on the complexity of the product, the
price, features, benefits and terms and conditions of the product.
The
shortest and longest time taken for product approval (from date of
receipt to date of clearance) is in the ranges of 2 days to 1708 days,
with an average time-lag of 109 days for the life insurance products,
103 days for the general insurance products excluding health insurance
products and 176 days for health insurance products, as informed by
IRDA.
Being
a service industry, the popularity of insurance industry depends on the
quality of service rendered by the company in terms of innovative
products and speedy settlement of claims. The quality of service may be
hampered if the products are not properly worded, under/excess priced
and doesn’t meet the needs of the customer. IRDA has informed that
need-based and reasonably priced insurance products by the insurance
companies would increase the popularity of the industry.
This
information was given by the Minister of State for Finance, Shri Namo
Narain Meena in written reply to a question in Rajya Sabha today.
Source : PIB release, March 20. 2012
