Insurers Have to Offer Add-On ‘Pay As Drive’ Cover Under Motor Policy
![Insurers Have to Offer Add-On ‘Pay As Drive’ Cover Under Motor Policy Insurers Have to Offer Add-On ‘Pay As Drive’ Cover Under Motor Policy](https://www.deccanchronicle.com/h-upload/2024/06/11/1096457-motorpolicy.webp)
Mumbai: Non-life insurers will have to offer additional product options of “pay as you drive”/ “pay as you go” as the first choice to motor insurance buyers along with comprehensive motor cover, health insurance policyholders with multiple policies will be free to choose the insurer with whom they want to file their full claim. Similarly, homeowners insurance buyers will have the option to choose add-on covers such as floods, cyclone, earthquakes, landslide, rockslides, and terrorism or opt out from a comprehensive fire and allied peril policy. These and several customer-centric measures were laid down by the Insurance Regulatory and Development Authority of India (IRDAI) on Tuesday in its Master Circular for general insurance business that repealed thirteen circulars.
The regulator in the circular said, “Additional options of “pay as you drive”/ “pay as you go” to be given as first choice to the customer in motor insurance. There should be no burden on customers for disposal of salvage. Policyholder is to be paid the claim amount. Collection of salvage from the customer is insurer’s responsibility.” Insurers have also been asked to settle claims within 7 days of receipt of the survey report.
A big relief under health insurance is that the regulator has done away with the contribution clause at the time of a claim. As a result, a policyholder with two or more insurance covers can choose the insurer/policy he wants to file the claim.
No claim shall be rejected for want of documents. All the required documents will have to be called by the insurers at the time of underwriting the proposal. “The customer may be asked to submit only those documents necessary and related to claim settlement (if cashless is not available),” said the IRDAI.
Says Darvesh Panchal, vice-president of Prudent Insurance Brokers, “IRDAI is pushing big reforms, especially for retail customers where insurance penetration is significantly low, especially in home insurance kind of products. Their intent is to simplify insurance, claims and make insurance products customer friendly.”
Anuj Parekh co-founder and CEO at Bharatsure said, “The IRDAI has introduced a significant update by revising the Customer Information Sheet. This enhancement aims to provide customers with a clear and concise overview of their policy, covering essential details such as scope, coverage, exclusions, and the claim settlement process. As part of this initiative, customers are required to acknowledge this sheet during the policy purchase process. Through this measure, IRDAI aims to enhance transparency in the insurance buying process, which has often been hindered by the complexity of insurance terms.”
Insurers have to implement Tech-enabled processes providing end-to-end technology solutions to ensure seamless onboarding, policy servicing, renewal, claim settlement, and grievance redressal. Suitability and affordability of customers to be considered in product development avoiding unnecessary and superfluous coverages, pricing of products to factor risk exposure, experience and expenses such that the premium rates are not excessive or inadequate or unfairly discriminatory said the regulator. Steps should be taken to ensure no unprincipled rate cutting and improper underwriting practices.