The Insurance Regulatory and Development Authority (Irda) is likely to miss the November 30 deadline set by the government for the final guidelines on standardised products for the insurance sector. Industry insiders say that it is not going to be out in the near future.
The 12-point agreement, which the Irda reached with the government in order to provide a fillip to the industry is still work-in-progress.
“Work groups have been formed but the work is not happening as fast as one would have liked, and it is not going to be completed in near future,” said the head of a leading insurance company who did not wish to be identified. Irda formed various work groups that include actuarial and other officials from several insurance companies to standardise 18 products so that “use and file “system may be introduced. Once the standardised products are framed, companies filing products based on it will automatically be deemed to have been approved after 15 days of intimation to Irda.
The difference in the products filed by companies will be on account of the premiums and money back amount in case of money back plans, and the basic structure will remain the same. The industry has been facing difficulties in product approvals.
Finance minister P Chidambaram, in his statement on October 1 said, “Irda will lay down guidelines on the principles underlying the design of any insurance product. Based on the recommendations of the working group that has been set up, Irda will issue draft guidelines and, after consultations, final guidelines will be issued by the end of November, 2012.”
However, the whole process is set to take some time as the working group is yet to complete the work of standardising the products and then the Irda has to accept it and roll out, said an industry insider.