Weekly Insurance Round-up Tuesday, July 12, 2022
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We're back with the latest edition of Beshak’s Weekly News Round-up, an analysis of all Insurance News & Updates from our in-house research team.
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✴️ IRDAI to investigate Covid-19 Claims 🔍
✴️ Year-on-year new business premium of life insurers rises by 39.73% 📈
✴️ Edelweiss General launches ‘SWITCH’ - mobile telematics-based comprehensive motor plan 🛡️
✴️ IRDAI sets 5 years target for greater penetration of insurance 🎯
✴️ IRDAI permits general insurers to issue sophisticated add-ons for motor insurance 🚗
- IRDAI has agreed to look into the covid-related claims that the insurance companies had earlier rejected.
- This decision was taken after a Public Interest Litigation was filed by Manav Seva Dham, a social service trust, against various insurers before the Bombay High Court.
- The petition stated that several insurers-
- Were engaged in several offenses, misused the policyholder’s funds, rerouted them through additional business, and paid hefty commissions to banks and their agents.
- Have caused wrongful losses to the policyholders.
- Rejected the claims without giving any solid valid reason.
- The trust has asked the court to pass an order to make sure that the insurance companies do not reject covid-related claims based on any unjustifiable reason.
- As per the Business Figures - Life report released by IRDAI, the collective new business income for life insurance companies saw a 39.73% year-on-year increase.
- The premium income increased to ₹73.674.53 Cr for the first quarter of this financial year, from ₹52,725.26 Cr. for the same period in the last financial year.
- The new business premium for the first quarter of this financial year of all the private life insurers grew by 48.75%. The premium income grew to ₹25,473.53 Cr. from ₹17,124.58 Cr.
- LIC saw a growth of 35.39%, where the premium income increased to ₹48,201 Cr. from ₹35,600.68 Cr.
- However, the premium income of LIC for June 2022 declined by 5.29%. The premium income decreased to ₹20643.67 Cr. from ₹21796.28 Cr.
- Private insurers saw an increase of 29.19% in their new business premium income for June 2022, where the premium income increased to ₹10,610.89 Cr. from ₹8,213.20 Cr.
- The cumulative new business premium of life insurers for June 2022 increased by 4.15%, to ₹31,254.55/- Cr. from ₹30.009.48/- Cr.
Source: Financial Express
- Under the IRDAI’s Sandbox initiative, Edelweiss General Insurance launched a mobile telematics-based comprehensive motor insurance policy.
- When the app detects motion while the car is being driven, the insurance instantly gets activated, making it convenient and hassle-free for the consumers.
- SWITCH is a usage-based model that assesses both quantity and quality, and the premium is determined accordingly.
- Customers may purchase SWITCH online and download the SWITCH app afterward to view their insurance policy.
- Features of SWITCH include -
- Everything is digital, from purchase to claim settlement.
- After the initial payment is made to activate the policy, customers can pay the remaining premiums in monthly installments.
- The policy covers accidental damages only while in motion and when switched on.
- The vehicle will have 24/7/365 protection against fire and theft.
- Add-ons available with this policy include -
- Depreciation protect
- Engine protect
- NCB protect
- Roadside assistance
- Invoice Value Protect
- Key and Locks Protect
- Consumable Expenses Protect
- Mandatory Deduction Protect
- Personal Belongings Protect
- Tyre Protect
- EMI Protect
- The policy comes in two modes -
- Max Mode:
- This is a comprehensive cover and comes with in-built add-ons like, personal accident cover, Mandatory Deduction Protect, Depreciation Protect, Road Side Assistance, and Consumable Expenses Protect.
- One can also customize the plan and opt for more add-ons according to their choice.
- Cruise Mode:
- This is a comprehensive cover, too, but this mode does not provide an option to buy any extra add-ons with the policy.
- It only covers loss or damage to the insured vehicle, third-party damage, personal accident cover, and passenger cover.
- Max Mode:
- Switch goes by the motto ‘Drive less, pay less; Drive better, pay less’.
- Customers will be given a driving score based on various parameters like overspeeding, distracted driving, and sudden brake, among others.
- IRDAI has set a 5 years growth target for general and life insurance companies to ensure that their products reach maximum people.
- A committee of state-level bankers and insurance companies (SLBIC) is also proposed for a regular review.
- As per the report, the targets set by IRDAI are -
- To double the insurance penetration to 6% from 3% by the year 2027.
- General insurers must increase their premium target to 11 Lakh Cr. from 2 Lakh Cr.
- The share of GDP achieved should be 2.5% instead of 1%.
- Additionally, according to the regulator, every state will now have a lead insurance company.
Source: Zee Business
- IRDAI has allowed general insurance companies to offer innovative add-ons for own-damage of vehicles depending on the driving history of the owners and the usage of the vehicle.
- As per IRDAI, general insurers can introduce own-damage cover for motor insurance in three categories -
- Pay as you drive:
- This will allow the customers to pay the premium based on their usage.
- The more one uses their vehicle higher the premium they pay.
- Pay how you drive:
- This will depend on the driving behavior of the owner.
- Vehicles with more accidents and fines will have to pay a higher premium.
- Floater policy:
- With this policy, customers can buy just one single policy for covering multiple vehicles including two-wheelers.
- Pay as you drive:
- According to IRDAI, the introduction of the above options will give a much-needed push to motor own damage insurance and help in enhancing its penetration.
Source: The Economic Times
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