Life insurance companies are pulling out all stops to ensure the transition to new regulatory regime by first October 2013 is smooth. Also, products are being developed such that business is protected and customer are convinced.
The Insurance Regulatory and Development Authority (IRDA) has asked all life insurers to re-file products for individual segments that didn’t conform to new norms on traditional products before first October 2013. That means insurers wouldn’t be able to sell existing policies after the deadline.
Life Insurance Corporation of India (LIC), India’s largest insurer, has started developing new products. The company’s actuary and product development departments are developing products with new features. These could be filed with IRDA.
Life insurers have started securing approval for revised products. For instance, HDFC Life has launched a product, ‘HDFC Life ClassicAssure Plus’ (a protection-cum-investment plan) with a limited premium payment term. This is compliant with the revised IRDA norms.
Private life insurers are also focusing on customer initiatives to push renewals. For instance, Reliance Life said apart from its focus on agent productivity, its customer contactability initiatives such as Reliance Life Plus, Life Plaza and Face-to-Face would help it significantly improve renewals.
Insurers say that industry might lose a few customers due to the fact that the first few quarters wouldn’t see new products. However, in the long run, most of the regulatory changes would pave the way for sustainable growth for the sector.
Insurance companies are also prioritizing products. For instance, IDBI Federal Life said after identifying the features in a product that had to be modified, the company focused on re-filing products that saw high sales.