Mumbai, Oct. 5
THE Insurance Regulatory and Development Authority of India is studying the implications of Internet selling of insurance products and will take precautionary measures if needed, Mr Mathew Verghese, former member, Non-life, IRDA, has said.
Some private general insurance companies are able to sell as much as 50 per cent of their policies (in terms of number not volume) on the Internet, said Mr Verghese speaking at a seminar on "Creating value chains in insurance distribution."
The policies sold on the Net are usually smaller and less complex such as travel insurance or personal accident covers. IRDA was looking at the issues of privacy - where personal and financial details are submitted, payment of premium as well as other transactions on the Internet, said Mr Verghese.
The designing of products as well as the communication of risk to the consumer was another issue that the regulator is concerned about. Mr P.A. Balasubramanian, Consulting Actuary, IRDA, said that while products needed to be well-designed and competitively priced, consumers should understand the charge structure at the time of purchase and throughout the term of the product.
He added that consumers should be able to switch between products with minimum charges if they find that it does not meet their long-term needs.
Mr Subramanian said that currently some of the savings products had complex options and the charges to switch between them were very high.