Mumbai:
Insurance Regulatory and Development Authority of India (Irdai) will soon approve products of life insurance industry under its innovative regulatory sandbox project.
Recently, the insurance regulator has approved 33 products of 10 companies under the regulatory sandbox project in the non-life and distribution category.
IRDAI Chairman Subhash Chandra Khuntia on Friday said the insurance regulator soonwould again open its widow asking for second round of applications under the regulatory sandbox project.
Khuntia was speaking at an event on “Digital Disruption: Embracing digital innovation in (Re) Insurance Business, organised by Pune based National Insurance Academy(NIA) in Mumbai.
Fintech solutions are also going to transform financial services in a big way and regulatory guidelines should be put in place in anticipation of these technological changes. He stated that the use of digital processors has helped in reduction of cost, increasing efficiency of the industry and fast settlement of claims.
“ We in Irdai have already allowed a regulatory sandbox regime because we do not know whether the (existing) regulations will be adequate for the new processes that these technologies will need.This is an experiment we we'll allow for six months and up to one year.If we find that these are old processes which will help transactions and make life easier for the insurer as well as the insured without compromising on the policy holders protection, we will think of tweaking the regulations to make it happen.”
He mentioned various initiatives taken by the IRDAI such as electronic storage of policies in repositories. There are around 50 lakh policies in the repositories.
Irdai chief also added that a total of about Rs 9,500 crore has been provided for three non-life insurance companies such as Oriental Insurance Company, United India Insurance(UII) and National Insurance Company(NIC).
For the next fiscal it is Rs 6,950 crore, while it is Rs 2,500 crore for this financial year. This move could improve the solvency margins of the insurers.
M.R. Kumar, chairman, LIC deliberated how technologies are impacting the life insurance companies and how the companies should embrace the digital innovation in their business. Mr Kumar explained how the industry is affected by fast paced and over-arching mega-trends. The trends include genomics, ubiquitous mobility, blockchain, cyber security etc.
Girija Kumar, CMD, Oriental Insurnace Company said that the global insurance industry has already crossed $5 trillion. According to global survey 85 per cent of customers are interested in going digital. He focused on six terms related to digital disruption, namely, cost efficiency, speed in operations, underwriting efficiency, reduction in claim processing time, customer satisfaction and sales production that is affecting the insurance industry .
G Satish Raju, CEO, Swiss Re India Branch talked about the introduction of quantum computing in insurance and how it will be useful in processing the huge amount of data that is involved in insurance. He emphasised on the importance of collecting and processing data and how well it is managed and handled. He also pointed out the rapid rise in numbers of monthly digital transactions taking place in insurance sector globally.
G. Srinivasan, director, NIA talked about how latest technologies like Block chain, IoT, Telematics and Artificial Intelligence, are reshaping the insurance industry and highlighted the importance of how the industry should prepare to embrace the digital innovation in their business.