sep insurance bhandari

Slide1: 

WELCOME TO ALL PARTICIPANTS AT 7TH INTERNATIONAL CONFERENCE ON INSURANCE

Slide2: 

BY K.N. BHANDARI PRESENTATION ON PROTECTION OF POLICY HOLDERS’ INTEREST

Slide3: 

INSURANCE REGULATORY AND DEVELOPMENT AUTHORITY IN TERMS OF AUTHORITY VESTED UNDER SECTION 14(b) OF IRDA ACT NOTIFIED REGULATIONS FOR PROTECTION OF POLICYHOLDERS’ INTERESTS PROVIDING INTER ALIA- For the obligations and duties of Insurers, Intermediaries at the point of sale Procedure for acceptance of a proposal, matters to be stated in life & non-life insurance policies Grievance redressal procedure Claim settlement procedure

Slide4: 

PROTECTION OF POLICYHOLDERS INTEREST HAS TWO DIMENSIONS: · FINANCIAL SECURITY · SERVICE

Slide5: 

· FINANCIAL SECURITY - Solvency Margin Requirement - In India IRDA has prescribed the rules for maintaining solvency margin for each insurance. However, these rules do not provide. - Any early warning system - Monitoring system in case solvency margin is not maintained.

Slide6: 

· FINANCIAL SECURITY - Credible Reinsurance Programme - Policyholders’ Protection Fund

Slide7: 

· SERVICE Pre-sale & Post-sale Servicing - Policyholders’ rights against breach of good faith - Standardization of Proposal Form - Remedial Actions are not explicit

Slide8: 

SUGGESTIONS Professionalisation of Institution of Surveyors Non compliance to be dealt with deterrent Penalties Empowered and Codified Grievance Redressal Mechanism Strengthening the Institution of Ombudsman

Slide9: 

SUGGESTIONS Provision for Return of Policy Synchronizing the Policies to Regulation requirements Standardizing the terms, conditions, clauses and warranties Allowing competition on pricing Guard against unhealthy business practice

Slide10: 

Let me conclude by submitting that Insurers need to understand that under the Common Law, they are not liable to just pay the loss indemnifiable under the policy but any delay or wrongful conduct tantamount to breach of good faith on their part. Such breach of good faith make them liable for costs and damages which the Policyholder suffers as a consequence of unreasonable conduct of the Insurers. The Insurers must remember that for example if a policyholder losses his shop or is driven into bankruptcy as a result of bad faith on an insurance company, the insurer, under Common Law, is responsible for all such losses, not just for the policy benefits. It is unfortunate that Common Law has not yet fully evolved and established by Indian Courts but it is unlikely that this will continue for ever.

Slide11: 

Thank you