Page 7 - Insurance Times August 2021

IRDAI

News

Mandatory to continue of- and launched these policies, no one had tral government to appoint the new
the visibility of the numbers… but at the IRDAI chairman following the retire-
fering standard Corona
same time, no one had predicted that ment of former chairman Subhash
policies: IRDAI tells insur- the numbers could go so bad within a Khuntia, is hampering regulatory

ance companies year…we took a hit last year, but it is progress and causing business disrup-
difficult to continue like this. Therefore, tions for India's insurance sector amid
After receiving multiple complaints of many insurance players are no longer the coronavirus pandemic, according to
some insurance companies not issuing
pushing this policy,” another industry industry stakeholders. Mr Khuntia re-
the Corona Kavach and Corona Rakshak source said. tired from the post on 6 May. Insiders
policies, the Insurance Regulator and
Development Authority of India (IRDAI) Besides he added that revising the pre- claim that there is a backlog of crucial
policy considerations and routine clear-
on Monday reiterated that it is manda- mium of such policies, where sum in-
tory for all general and health insurers sured is not very high, does not make ances are getting delayed
to offer these standard Covid-19 poli- sense even for sellers of the policy as These concerns have been further ex-
cies to policyholders. In the wake of the well as buyers. While Corona Kavach is acerbated as the country's insurance
first wave of Covid-19 last year, IRDAI an indemnity-based product, Corona sector has taken a massive hit owing to
had directed all non-life insurance com- Rakshak is a benefit-based product. the devastating second wave of the
panies to roll out these two standard While benefit policies pay a fixed COVID-19 pandemic in the second quar-
Covid-19 policies by July 10, 2020. amount following a claim, indemnity ter of this year. Highlighting one such
This was mainly targeted at people who plans provide either cashless or reim- concern, an industry executive request-
did not have any health insurance bursement for the money spent on ing anonymity said: "The renewal of
cover. These policies were earlier per- medical treatment. Both are offered reinsurance Unique Identity Numbers
mitted to be offered till March 31, for a tenure of three and half months, (UIN) has been stuck for several weeks
2021, and with second wave hitting the six and half months or nine and half now in the general insurance category.
country, the regulator allowed insurers months. While the sum insured in Co- These are routine clearances, and de-
to offer and renew these standard Covid rona Kavach ranges between Rs 50,000 lays are affecting the pricing of policies."
policies up to September 30, 2021. to Rs 5 lakh, in Corona Rakshak, it The chief executive of a general insurer
ranges between Rs 50,000- Rs 2.5 lakh.
An industry expert pointed out that the said that the delay is affecting key in-
rising Covid claim ratios have been dustry decisions. For instance, third
pinching insurers. He pointed out that Delay in appointing new party motor insurance rates which are
the pricing of standard Covid products, IRDAI chief: insurance sec- set every year by the regulator are yet
that were fixed last year by insurers, do to be approved for the financial year
not seem viable anymore in the face of tor worried starting 1 April 2021 (FY22). "The rates
rising Covid claims. “When we priced it A delay of over two months by the cen- were not specified in FY21 either due
The Insurance Times, August 2021 7