Insurance Regulatory and Development Authority (IRDA) issued a draft circular on policy servicing forms. The two main stipulations that IRDA has focused on are – (1) Availability in Languages recognized under Constitution of India (2) Minimum Font Size of “Times New Roman 7”
(1) Availability in Languages recognized under Constitution of India
While the existing regulations specify that all print material, used in the pre-sales and sales process, shall be made available in multiple languages, there is no rule for making available all the forms used during the course of post-sale policy servicing such as; claims, loans, surrender, alterations, nominations, assignments, revivals etc. Therefore, IRDA has advised all the Insurers to make available all the policy servicing forms also in languages recognized under the Constitution of India.
(2) Minimum Font Size of “Times New Roman 7”
The existing guidelines on Advertisement, Promotion and Publicity of Insurance Companies / Intermediaries stipulate a minimum print font of Times New Roman No 7 to cover the publicity and sales material of all the Insurers, There is no prescription with regard to the need for using the minimum / reasonable font in respect of all forms provided / used, both in respect of those forms provided / used in the grant of cover as also those forms provided / used during the course of policy servicing. Therefore, all insurance companies are advised to use a minimum print equivalent to font “Times New Roman – size no. 7”.
The reason to introduce above two rules is basis the possibility that the prospects (of insurance policies) and policyholders may find it difficult to go through the conditions and clauses of various forms that are printed in insignificant print.
IRDA believes that while the cost impact of such a change will be high on the insurance companies, this initiative may give a boost to customer confidence and increase transparency at client level operations, eventually benefitting the insurers in the long-term.
