Life insurers get time to adopt standard proposal format

NEW DELHI: Life insurance companies have time till April 1, 2014 to adopt a standard form for policyholders aimed at bringing in more transparency and uniformity.

In March, IRDA (Insurance Regulatory and Development Authority) had said that these guidelines would be effective from February 16, 2013.

The aim to bring in a 'Standard Proposal Form' format was to make a product comprehensive and thus bring in transparency and uniformity about a product to the policy seekers.

"Taking into account various representations received from life insurance industry, the competent Authority...has deferred the implementation of obligations under IRDA (Standard Proposal Form for Life Insurance) Regulations to April 1, 2014," IRDA said in a notification.

The 'Standard Proposal Form', contains column for personal information and suitability analysis for the policyholder.

It seeks to ensure that all relevant questions required to understand a policy/product are carried in the form and thus protects the interest of the prospect.

It carries details about the suitability, based on the information provided in the form, about a product entailing the risk profile, financial situation, investment objectives of a policy seeker.