The insurance regulator IRDAI on Friday has constituted a panel on Friday In a bid to overhaul the current product structure in the Motor Own Damage segment.
The panel will revisit the wordings of the various existing products and also develop new ones where necessary make its recommendations within 16 weeks, said panel.
“Today, there is a need to revisit the current product structure keeping in view developments in technology relating to motor vehicles as well as the fast changing eco-systems,’’ said IRDAI.
The entire motor portfolio of the industry currently stands around R 50,000 crore and motor third party and motor OD contribute to the overall portfolio in equal proportion.
The panel will revisit the framework for Motor Insurance enunciated in the General Regulations (GR) of the erstwhile India Motor Tariff (IMT) in the light of various developments over the last few years, including the impact of de-tariffing of the pricing component and arrive at a revised framework.
It will also revisit the classification of products under Motor OD as well as the product structure and design including aspects such as duration of products, expansion of product suite to include technology enabled ones etc.
The panel which will be headed by P. Venkatramaiah, general manager & director (Retd), National Insurance Company, will Take stock of various add-ons in the market, identify ones that could be standardised across the industry and identify those categories that could be left for insurers to innovate.
Some of the other other members are Balwant Singh, general manager & director, Oriental Insurance Company,.Gauri Venkatesan, deputy general manager, United India Insurance Company,Amitabh Jain, head, Motor Underwriting and Claims, ICICI Lombard General Insurance Company
While pricing of the Motor Own Damage segment was de-tariffed in 2007, the basic product structure including the terms and conditions, continues to be governed by the General Regulations (GRs) and various other provisions of the erstwhile India Motor Tariff (IMT). It may be noted that para 7.2 IV (h) and (i) of Guidelines on Product Filing Procedures for General Insurance Products, while dealing with compliance requirements, stipulate that the scope of standard covers available under the erstwhile tariff shall not be abridged and that the wordings of the products given in the erstwhile tariff shall not be changed nor can there be any changes to the General Regulations (GR).
Insurers are, however, allowed to file add-ons to the package policy subject to the product filing guidelines. The number of such add-ons in the market has become humongous, given the evolving nature of the business and demand for various types of covers.