IRDAI issues circular on filing and usage procedure for minor modifications in the products offered by Life Insurers
The Insurance Regulatory and Development Authority of India (“IRDAI”) has recently issued a circular regarding the file and use procedure for minor modifications under existing products and riders offered by life insurers.
With a view to ensure that the already approved products offered by the life insurers are compliant with existing regulatory provisions even while undergoing minor modifications, the IRDAI has issued this circular.
The key highlights of the circular are as follows:
- The following minor modifications to the approved products and riders will be allowed without complete procedure under File and Use:
– Changes in premium rates/charges and benefit amounts under approved products and riders on account of implementation of IRDAI (Payment of commission or remuneration or reward to Insurance Agents and Intermediaries) Regulations, 2016;
– Addition of already approved riders to approved products;
– Addition of premium payment modes (frequencies);
– Addition of new distribution channel; etc.
2.The life insurers must ensure the following while making minor modifications to the already approved products without the complete File and Use:
– There is no detrimental change in premium rates/charges, benefit structure or any other provision in respect of policies already sold under existing versions of the product / rider.
– There is no change in benefit structure of the product / rider.
– The premium rates/charges, benefit structure, terms and conditions under modified product and rider are, workable and sound, the assumptions are reasonable and premium rates fair.
- The insurers may launch the modified version of the product / rider provided some conditions are satisfied including the following:
-The existing version of the product /rider is withdrawn from the market for new business before launch of modified version of that product;
-The modified UIN is to be displayed in all the documents of the modified product.
–Within 15 days from the end of every quarter, the insurer is required to send a statement as per Annexure III regarding modified products / riders launched during that quarter to the Actuarial Department with a copy to the Life Dept.