Top Insurance News In February 2024

Get ready for a quick rundown of the top news in the insurance industry this February!

Life -  Life Insurers Propose Revised Surrender Value Calculation to IRDAI

Indian life insurers are proposing a change in how surrender values are calculated to the Insurance Regulatory and Development Authority of India (IRDAI). Instead of a fixed threshold, they suggest tying surrender value to the accumulated policy value, aligning it with the policy's “Savings Component.”

This adjustment responds to IRDAI's draft in December 2023, introducing premium thresholds. Insurers believe this change will benefit customers in the long run, reducing surrender charges and discouraging disruptive behaviour in the short term. The industry and IRDAI aim to make a decision that safeguards customers without harming insurers or their profit margins.

SME - Boosting Solar Power Security: MNRE Reveals Special Insurance Options

The Ministry of New and Renewable Energy (MNRE) has just revealed an updated list of insurance providers offering customised coverage for solar power plants. Collaborating with the Department of Financial Services (DFS) and the Insurance Regulatory and Development Authority of India (IRDAI), this move aims to keep stakeholders informed about the latest insurance options available.

The key players in the updated list are:

• The New India Assurance Co. Ltd. with  New India Solar Energy Insurance Policy
• Tata AIG General Insurance Company Limited  with Weather Insurance Policy and Solar Module Warranty Insurance
• HDFC ERGO GICL with Solar Panel Warranty Insurance
• ICICI Lombard General Insurance Company Limited with Photovoltaic Panel Warranty Insurance
• IFFCO-Tokio General Insurance Co. Ltd with Photovoltaic Sales Policy
• Cholamandalam MS GICL with Chola Solar Plant Protect Policy

By meeting the unique insurance needs of the sector, this initiative seeks to boost stakeholder confidence and will ensure sustainable growth in solar power production.

Life - Bajaj Allianz Introduces Innovative Life Assurance Plan for Guaranteed Early Income

Bajaj Allianz Life Insurance introduced a great plan called the Bajaj Allianz Life Assured Wealth Goal Platinum. This insurance plan guarantees early income and is a simple individual life insurance and savings plan. Besides ensuring life cover, it's perfect for those who want a balance between security and flexibility.

This plan by Bajaj Allianz ensures guaranteed payouts starting from the second year. Policyholders can use this income for immediate goals or accumulate it for a lump sum later. In case of the policyholder's demise during the income period, the nominee receives continued income and an enhanced return of premium for financial security.

The plan is simple, involving two steps: 

• Choosing the premium amount and payment duration for financial flexibility
• Selecting the income start year and duration to align payouts with specific financial goals

General - IRDAI Proposes Extending Insurance Policy Review Period to 30 Days

The Insurance Regulatory and Development Authority of India (IRDAI) is considering a significant change in the insurance industry with its proposal to extend the free-look period for insurance policies from the current 15 days to a more consumer-friendly 30 days. This move, outlined in the draft IRDAI (Protection of Policyholders’ Interests and Allied Matters of Insurers) Regulations 2024, aims to empower policyholders with a longer duration to review their policies and, if unsatisfied, return them for a refund.

Under the proposed regulations, the 30-day free-look period would apply to policies acquired through any mode, indicating a potential shift towards issuing most policies in electronic form. 

Notably, life insurance policies currently have a mandatory 15-day free-look period, but electronic policies and those obtained through a distance mode already enjoy a 30-day window.

Motor -  ACKO Introduces Insurance for e-Two Wheeler Removable Batteries

ACKO General Insurance introduces an Extended Battery Warranty plan exclusively for removable batteries in Electric Vehicles (EVs). According to ACKO's EV report, nearly half of EV owners express concerns about battery replacement costs. This innovative plan provides extended coverage, shielding vehicle owners from unexpected repair expenses and instilling confidence in the ownership of electric vehicles.

The initiative by Acko not only promotes a more sustainable adoption of electric vehicles but also sets new benchmarks in performance, innovation, and financial security. 

Specifically designed for the VIDA V1, the first EV from Hero MotoCorp's VIDA brand, this plan covers the vehicle for the fourth and fifth years or up to 60,000 km. By addressing worries about battery life and performance, ACKO aims to enhance overall EV acceptance.

Health - Health Insurance Coverage May Double Under Ayushman Bharat

As per the Interim Budget 2024, the Government of India is planning to double health insurance coverage under the Ayushman Bharat scheme, from Rs. 5 lakhs to Rs. 10 lakhs per family per year. This move, expected to be announced soon, aims to include serious illnesses like cancer and transplants, providing crucial financial support.

Additionally, the Ministry of Health plans to extend benefits to more people, targeting 100 crore beneficiaries, including farmers, construction workers, and ASHA workers over the next three years. Currently covering 55 crore individuals, Ayushman Bharat is on track to become one of the world's largest health assurance schemes.

To fund these enhancements, an extra Rs. 12,076 Crores annually is estimated, which will eventually double the current budget to Rs. 15,000 Crores in the financial year 2025. This initiative, rooted in the goal of Universal Health Coverage, shows the Government's commitment to making quality healthcare accessible to all.

Also Read: Supreme Court Urges Action on Healthcare Pricing Discrepancies