All-in-one policy plan to spread insurance in India

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All-in-one policy plan to spread insurance in India


Q. Why in News/Context?

·  In an ambitious bid to expand the poor insurance penetration in the country, the Insurance Regulatory and Development Authority (IRDA) is devising a new affordable bundled product to give citizens protection against multiple risks, and seeking to expedite claim settlements by linking death registries onto a common industry platform.

·  These initiatives are part of a broader overhaul, including legislative amendments to attract more investments through differentiated licences for niche players similar to the banking sector, with an eye on making insurance “available, affordable and accessible” to citizens with a ‘Gram Sabha- to district- to State-level’ approach. The regulator believes these changes could double the number of jobs in the sector to 1.2 crore.


 

 

Q. What is Bima Trinity - BimaSugam,BimaVistar and BimaVaahaks?

·  IRDA chief Debasish Panda said that they are striving to create an “UPI-like moment” in insurance through a plan worked out with general and life insurance firms that he termed “Bima Trinity”.

·   A new BimaSugam platform will integrate insurers and distributors on to one platform to make it a one-stop shop for customers, who at a later stage can pursue service requests and settlement of claims through the same portal.

·    BimaVistar will be a bundled risk cover for life, health, property and casualties or accidents, with defined benefits for each risk that can be paid out faster than usual without the need for surveyors.

·   The third part of the trinity envisaged by the IRDA entails a women-centric workforce of BimaVaahaks (carriers) in each Gram Sabha that will meet the women heads of each household to convince them that a composite insurance product like BimaVistar can “come in handy if there is any distress”.

Q. Way forward?

·    To meet the target of providing insurance cover for all by 2047, the IRDA is also looking to form State-level insurance committees similar to the ones prevalent in the banking sector, and rope in State governments to formulate district-level plans, he said at the Confederation of Indian Industry’s annual meeting.

·   Separately, the IRDA has proposed amendments to the insurance laws that the government may take up soon, which will allow differentiated capital requirements for niche insurers so as to attract more investments, and permit players to add value-added services to the policies they sell.

·    The amendments will also enable the entry of new players in the form of micro, regional, small, captive players, specialised players, and even composite licences. By doing this kind of differentiation, we will be able to cater to different geographies and the different strata of the population

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