Page 13 - The Insurance Times July 2025

Allianz has set up a dedicated desk for telematics, which can track real-time This development comes amid rising
expedited processing. HDFC Life re- driving patterns. complaints related to cashless
quires only proof of death from local Digital-first insurers like ACKO General hospitalisation issues and unjustified
authorities to initiate claims. Insurance are already responding to claim rejections, especially post-COVID,
as health insurance adoption surges.
these reforms, leveraging technology
Regulatory Overhaul is to offer personalized premiums, dy- The regulator aims to tighten over-
Transforming Motor Insur- namic policy features, and customer- sight and ensure that insurers adhere
friendly services. For both insurers and to fair claims practices, prompt settle-
ance Landscape in India policyholders, this evolution marks a ment timelines, and customer-centric
The motor insurance sector in India is move toward a smarter, fairer motor grievance redressal systems.
undergoing a significant transforma- insurance ecosystem. The move signals IRDAI’s growing fo-
tion, driven by regulatory reforms ini- cus on accountability, transparency,
tiated by the Insurance Regulatory IRDAI Flags Lapses in and consumer trust in the fast-evolv-
and Development Authority of India ing health insurance landscape.
(IRDAI). These changes aim to foster Health Claim Processes at
greater transparency, inclusivity, and 8 Insurers: Report IRDAI Imposes Rs. 1 Crore
digital integration, reshaping how poli-
The Insurance Regulatory and Develop-
cies are priced and delivered. Penalty on Edelweiss Life
ment Authority of India (IRDAI) has re-
Traditionally, motor insurance premi- portedly identified serious lapses in Insurance for Regulatory
ums were calculated based on fixed health insurance claim settlement prac- Violations
parameters such as vehicle type, en- tices across eight insurance companies, The Insurance Regulatory and Devel-
gine capacity, geographic location, and according to sources familiar with the opment Authority of India (IRDAI) has
basic driver demographics. However, matter. These lapses include delays in
imposed a Rs. 1 crore penalty on Edel-
these outdated criteria fail to reflect claim approvals, non-transparent pro-
weiss Life Insurance for multiple viola-
an individual's actual driving behavior cesses, inadequate documentation, and
tions of regulatory norms. The fine fol-
and risk level. As a result, cautious driv- denial of valid claims, all of which raise
lows an inspection conducted by IRDAI,
ers often pay the same premiums as concerns over policyholder protection
which revealed lapses in areas includ-
high-risk ones, receiving no rewards and industry credibility. ing policy servicing, corporate gover-
for their safe driving record. The insurers, whose names have not nance, and disclosure practices.
This uniform pricing discourages safer been officially disclosed, have been Key issues flagged by the regulator in-
driving and limits incentives for respon- asked to submit detailed explanations clude delays in claim settlement, inad-
sible behavior behind the wheel. The and corrective action plans. IRDAI is equate documentation, and non-compli-
regulatory shift seeks to address this also considering imposing penalties or ance with IRDAI's reporting require-
imbalance by encouraging usage- initiating further regulatory measures ments. The authority stated that the in-
based insurance models and if compliance is not achieved swiftly. surer failed to adhere to prescribed stan-
dards, potentially impacting policyholder
RBI Cancels 30-Year Green Bond Auction Amid Yield interests and overall transparency.

Concerns Edelweiss Life Insurance has been di-
rected to strengthen its internal systems,
The Reserve Bank of India (RBI) has cancelled the 30-year green bond auc-
tion despite receiving bids worth Rs 10,943 crore-more than twice the no- improve compliance protocols, and sub-
tified amount of Rs 5,000 crore. This marks the second cancellation of such mit a detailed corrective action plan.
an auction, the previous one occurring in May 2024. The insurer is expected to take immedi-
ate steps to address the gaps and pre-
Traders believe the bids demanded higher yields than acceptable to the RBI, vent recurrence of such violations.
possibly due to recent rupee depreciation and changing crude oil prices. "We This penalty underscores IRDAI’s firm
had a rate cut when crude prices were low. But with a weaker rupee, inves- stance on enforcing regulatory disci-
tors likely sought higher yields," said a CIO from an insurance firm.
pline in the life insurance sector, with
The move signals RBI's caution on long-term borrowing costs amid evolving a clear focus on policyholder protec-
macroeconomic pressures. tion and market integrity.

12 July 2025 The Insurance Times