The Insurance Regulatory and Development Authority (IRDA) has revised the norms for traditional life insurance products at its board meeting held here on Wednesday.
When contacted, IRDA Chairman J. Hari Narayan, told Business Line that the insurance products would now have mandatory minimum death benefit and minimum surrender value.
“The life insurance products have also been aligned with the pension products in some aspects of benefits,’’ the IRDA chief said adding that the aim was to enhance customer protection keeping in view the long-term nature of life insurance products.
“We have earlier reformed linked-products segments and now concentrated on life products,’’' he said.
In June last year, the insurance regulator had circulated draft guidelines on the proposed changes in life insurance products.
It was proposed that the minimum sum assured should be higher by 10 times the annual premium or 0.5 times of the annual premium multiplied by the term of the policy for those who are below 45 years.
For below 45 years, according to the draft, the minimum sum assured is higher by 10 times the annual premium or 0.5 times the annual premium multiplied by the term of the policy or 105 per cent the premium paid as on the date of the policyholder’s death.