Insurance for all by 2047 - steps by IRDAI to achieve mission

“Insurance for all by 2047” is the new mission set by IRDAI to increase insurance penetration in the country. This step of the Investment Regulatory and Development Authority of India (IRDAI) shall prove to make the insurance sector more investment-friendly.

IRDAI is looking to provide appropriate life, health, and property insurance coverage to each and every citizen of India. In order to achieve this mission necessary steps are taken toward creating a progressive, supportive, facilitative, and forward-looking regulatory architecture. 

This shall result in creating a competitive environment that will further help the policyholders to have a wider choice, accessibility, and affordability for their desired Insurance requirements.

These reforms by IRDAI focus on the three main pillars of the insurance ecosystem. Some of the steps being undertaken are as follows:

• Making the right products available for customers
• Along with a robust grievance redressal mechanism
• Improve Ease of Doing business in the insurance sector
• Boost innovation, competition, and distribution efficiencies with mainstream technology and move towards the principle-based regulatory regime

Some of the recent initiatives taken by IRDAI to achieve this goal are mentioned below.

Relaxation of Solvency Norms

Due to the relaxation of solvency norms for General and Life insurers, the growth of the Insurance Industry shall be strengthened which will eventually direct the insurers to invest in the right strategies.

Increase in tie-up limits for intermediaries

A Corporate Agent can tie up with 9 insurers (earlier 3 insurers), whereas Insurance Marketing Firms (IMF) can tie up with 6 insurers (earlier 2 insurers). This is applicable in each line of business i.e. life insurance, general insurance, and health insurance companies for the distribution of their insurance products. The area of operation of the IMF has been expanded to cover the entire state in which they are registered. This will benefit policyholders by giving them a wider choice and access to insurance through various channels and shall also increase insurance penetration in the country.

Regulatory sandbox

This Feature provides a testing environment for the companies to enable them to test their innovative products, technologies, etc in a controlled regulatory environment. The motive of the Regulatory sandbox is to allow the insurers/intermediaries to carry on with the experimentation within the period of ‘6 months’ up to ‘36 months’ which keeps moving from the existing batch-wise (cohort approach) clearances/approvals to clearances/approvals on a continuous basis. A provision for review of rejected applications under sandbox has also been introduced as a part of amendments.

Listing of Insurance Companies

Listing of insurers in the stock exchanges shall allow the insurers to raise capital. This feature enhances the transparency, efficiency, and accountability of insurers. Go-digit General Insurance Company Limited has received final approval from IRDAI for listing.
Also, in-principle approval to IndiaFirst Life Insurance Company Limited has also been provided for the listing.