The Insurance Regulatory and Development Authority of India (Irdai) on Monday allowed general and health insurance companies to launch four more categories of individual products, add-ons and riders of health policies to be filed under the use-and-file procedure. The four new categories are personal accident insurance, overseas travel insurance, domestic travel insurance and benefit-based health insurance products.
Under the use-and-file norms, insurers are permitted to market certain products without Irdai’s prior approval. Corona Rakshak Policy, a standard benefit-based health plan, which was launched last year in the aftermath of the Covid-19 pandemic, is an example of a use-and-file product.
This is a great initiative by the regulator to promote incremental innovation. The use-and-file process helps Insurers to file and take products to market faster thus promoting faster innovation. This will allow insurers to tailor products as per customer needs and launch in a very short time frame.
In a circular issued on Monday, Irdai notified certain conditions for the four product categories.
For the purpose of these guidelines, benefit-based health insurance products have been defined as the products under which a specified benefit is paid as a fixed benefit on happening of the contingency covered.
In respect of the personal accident, domestic and overseas travel products ‘use and file’ is allowed only if the coverage offered both under base covers and add-on covers or riders is contingent upon an accident and/or travel as relevant. Irdai said in a release.
These new norms will applicable in respect of products filed from 1 April 2021 onwards.
This is undoubtedly a great step by Irdai. This move will boost the speedy product launches and more innovation as companies will be able to use the product and then file it. Speedy product launches will directly help customers in having more health insurance options to choose from as per their needs. With the same, we can expect great innovations in the health insurance industry.