Insurance regulator Irda today released new mortality table for life insurance companies for fixing premium, which may lower payments towards new policies.
The table called Indian Assured Lives Mortality (2006-08) will be effective from April 1, Irda said in a circular.
The mortality table indicates the rate of deaths occurring in a defined population during a selected time interval, or survival from birth to any given age.
According to sources, Irda's new table will lead to reduction in life insurance premium.
The new table is an improvement over the existing table as it is based on the latest mortality and claim experience of different life insurance companies.
The variation in mortality across regions and gender is incorporated in the latest table.
The existing table is based on LIC's data alone for the period 1994-96.
There has been significant improvement in mortality rates across all ages, particularly in the young age, since 1996 and the new table will be useful for insurance companies in streamlining the pricing of policies based on latest data.