Page 11 - Insurance Times October 2020

It has proposed that a cell captive standalone micro-insurance must be continued seamlessly, IRDAI said in a
model may be offered as a way for mi- developed with the highest prudential circular to insurance firms.
cro players to underwrite the micro-in- standards in consultation with those During renewal, sum insured should be
surance business. As per this model, who are already undertaking micro- allowed to be changed by the policy-
existing insurers and others can become insurance as intermediaries (coopera- holder. "For any increase in the sum
cell owners by bringing in capital and tives, mutuals, NGOs) as well as other insured, the waiting period should start
share the underwriting risk with SAMIs stake-holders," the panel said. afresh only for the enhanced portion of
with a capital of no more than Rs 5 crore the sum insured, the regulator has
or such contribution as may be consid- IRDAI allows renewal of said. "Corona Kavach and Corona
ered appropriate, the panel said. Covid policies Rakshak policies are permitted to be
"The focus must be on expanding the renewed till March 31, 2021 comply-
market and that could be done by en- IRDAI has allowed renewal, migration ing with clause 5 of Guidelines on in-
abling entry of multiple players by re- and portability of Covid-specific stan- troduction of short term health insur-
ducing the capital requirements," it dard health products - Corona Rakshak, ance policies providing coverage for
said. Corona Kavach and Group Corona Covid-19 disease," the regulator said.
Kavach policies.
The Insurance Act, 1938 should be In respect of Corona Kavach individual
amended to bring the standalone mi- IRDAI said Corona Kavach and Corona policies, insurers have the choice to
cro-insurance business under the regu- Rakshak policies of any tenure will be offer migration to any other indemnity
latory purview. "This will include defin- allowed to be renewed for further based health insurance product offered
ing micro-insurance, micro-insurers, terms of three-and-a-half months, six- by them as per the option exercised by
reducing the capital requirement and/ and-a-half months or nine-and-a-half the policyholder.
or giving powers to IRDAI to decide on months, as per the option exercised by For Corona Kavach Group policies, in-
capital requirements for SAMI. How- policyholder. The renewal should be surers have the choice to provide mi-
ever, amending the Insurance Act, subject to the underwriting policy of gration to the members insured to any
1938 may require time, it said. the insurer, it said. other individual indemnity based
IRDAI should establish a Micro-insur- "General and health insurers are per- health policy at the point of exit of the
ance Development Fund to support mitted to allow portability of Corona member insured from the group policy
and promote the growth of the micro- Kavach (individual) policy from one in- or the cessation of coverage of the
insurance business across the country, surer to another. If an insurer is found underlying group policy, IRDAI said.
it said. "The fund could support human deficient in servicing their cu1stomers, When migration is allowed, the accrued
resource development, digital and fi- they can switch over to another in- gains of waiting period served in the
nancial literacy, IT infrastructure and surer," said an official. existing Corona Kavach policy (indi-
product development, to mention a Gurdeep Singh Batra, head-retail un- vidual or group) should be protected in
few," the panel added. respect of coverage for Covid-19, in
derwriting, Bajaj Allianz General Insur-
The committee is of the view that the ance, said, "The Covid-19 vaccine is yet the migrated policy, it said. The ac-
above recommendations should be to come out and the purpose of these crued gains of waiting period served in
implemented at the earliest in order to policies is to mainly cover the treat- the existing Corona Kavach policy
raise the spread and outreach of mi- ment costs against immediate health should be protected in respect of cov-
cro-insurance in India. This is especially risks that people face due to the pan- erage of Covid-19, by the porting-in
urgent given the current Covid-19 pan- demic." Close to 30 lakh lives have insurer.
demic and the insecurity it has resulted been covered under Covid polices since When migration or portability from the
in for citizens, and especially the vul- their launch in July 2020. However, Corona Kavach policy is allowed by the
nerable working poor. renewals should be done before the insurers, such migration or portability
The regulator can facilitate reinsur- expiry of the existing policy contract. to any other comprehensive health in-
ance of micro-insurance through the When policy is renewed, an additional surance policy should be allowed, till
existing licensed insurance or reinsur- waiting period of 15 days should not be the end of policy period of the existing
ance companies. "Regulations for imposed and the coverage should be Corona Kavach policy.
The Insurance Times, October 2020