Insurance companies to provide comprehensive policy feature details from January 1: Report

From January 1, insurance companies must furnish for policyholders essential policy details, such as the sum assured, coverage specifics, exclusions, and claims procedure, in a standardised format to ensure straightforward comprehension of the terms and conditions, PTI reported.

The Insurance Regulatory and Development Authority of India (IRDAI) has updated the current customer information sheet to present fundamental details about the purchased policy in a more easily comprehensible format, it said.

“The revised customer information sheet (CIS) shall be implemented with effect from January 1, 2024,” the regulators said in a circular to all insurance companies, according to PTI. The IRDAI emphasised on the significance of policyholders comprehending the terms and conditions of their purchased insurance policies, said the report.

As per the report, the circular added, “Since a policy document may be fraught with legalese, it is imperative to have a document that explains in simple words, the basic features with regards to the policy and provides necessary information.”

Additionally, the IRDAI pointed out that ongoing complaints stem from an information gap between insurers and policyholders, serving as a rationale for the introduction of the updated CIS. Under the revised CIS, insurers are obligated to furnish details such as the “name of the insurance product/policy,” “policy number,” “type of insurance product/policy,” and “sum insured", said the report.

“In response to the recent IRDAI circular, we see it as an affirmation of our commitment to demystify insurance for all. These changes prioritise the interests of policyholders by ensuring they receive clear and concise information about their insurance policies. Policyholders must have a complete understanding of the terms and conditions of their insurance coverage. With the revised customer information sheet (CIS) now in place, policyholders will have easy access to vital information, such as the sum assured, policy coverage, exclusions, claims procedure, and more. This development not only enhances transparency but also empowers policyholders to make informed decisions about their insurance needs," Dhirendra Mahyavanshi, CEO & Cofounder, Turtlemint, said.

The circular further states that insurers, intermediaries, and agents are required to distribute the Customer Information Sheet (CIC) to all policyholders and secure an acknowledgement thereof. Furthermore, the CIC should be made accessible in the local language if the policyholder expresses a preference for it, said the report.