The Indian government is reportedly mulling a possible change in current regulations that may allow general insurers to offer a wider range of products and services beyond traditional insurance policies. According to the draft of the Insurance Laws (Amendment) Bill, 2022, which is currently under consideration by the government, general insurers in India may soon be authorised to provide various additional services, such as gym memberships, repair services and diagnostic services.
The main objective of the amendment is to diversify insurance products and increase customer value. However, as of now, general insurers will still be prevented from selling financial products such as mutual funds, similar to the restrictions that apply to banks in India.
The Insurance Regulatory and Development Authority of India (IRDAI) and the Department of Financial Services will be responsible for defining the list of related activities that may be provided in addition to existing insurance policies. The authorities have not yet decided if this type of diversification of services is beneficial at this point in time, though this may be considered once the insurance market in India matures and becomes larger.
Moneycontrol can confirm that the proposed bill could be considered in the monsoon session of Parliament following the necessary Cabinet approval.
The Insurance Regulatory and Development Authority of India (IRDAI) is the Government of India’s apex regulatory body for the insurance sector in India. IRDAI is responsible for promoting, developing, and regulating the insurance industry in India by issuing licences, setting and monitoring insurance standards, and protecting policyholders’ interest.
T S Vijayan is the current IRDAI Chairman and a former life insurance industry executive. He has held numerous top-level positions in the Indian life insurance sector, having served as the Managing Director of the all-India life insurer Life Insurance Corporation of India (LIC) and managing the activities of its various subsidiaries.
The government’s move to expand the range of services provided by general insurers in India is expected to be beneficial to customers, as it would open up a wide selection of insurance policies designed specifically to meet their insurance needs. This will also allow insurers to tap into new segments of the market, thus helping grow the Indian insurance industry.