The Rs84,000-crore general insurance industry feels that the ‘use and file’ norms unveiled recently by Irdai will ensure faster growth in the industry, though the regulations may lead to price rise of such products.
The new norms, coming into force from April 1, will allow marketing of corporate products even before the regulatory approval.
“The new system would enable insurers to adapt faster to the requirements of commercial entities. All of these changes are positive, indeed path breaking,” ICICI lombard General Insurance managing director and chief executive Bhargav Dasgupta told the news agency.
“We have asked the industry body General Insurance Council (GIC) to prepare the common wordings while designing covers for the corporates,” New India Assurance CMD G Srinivasan, who is also the chairman of GIC, said.
“A price rise across the segments is very much expected”, he said without divulging any further details.
According to Srinivasan, the new norms will bring in a great deal of discipline in the general insurance industry improving the financials of the industry.
“With the stipulation that the general insurers have to operate under 100 per cent combined ratio, the industry should see rate hardening which over a period of time would ensure underwriting profits,” SBI General senior vice president, marketing and product development Gunjan Ghai said.