Life and health combi policies to be available through single insurer:BL 241209

Life and health combi policies to be available through single insurer:BL 241209

A tie-up is permitted between one life insurer and one non-life insurer only and between these two insurers
any number of products may be promoted.

Combi Products, a combination of life and health insurance schemes, will soon be available in India through
a single insurer.The Insurance Regulatory and Development Authority on Wednesday released the
guidelines for insurers to bring out such products primarily through a tie-up between a life insurer and non-
life insurer.
One package
IRDA has been considering a proposal to allow promotion of combined products of pure term life insurance
offered by life insurance companies along with standalone health insurance products offered by non-life
insurance companies in one package.This is chiefly intended to enhance the penetration of health insurance
in the country on the back of the huge distribution network built by the life insurance sector.The total health
insurance premium is estimated at about Rs 6,000 crore, while the life insurance segment (including renewal
premium) is over Rs 2 lakh crore.
According to the IRDA guidelines, which are not applicable to micro-insurance products, the Combi Products
could be promoted by all life insurance and non-life insurance companies through a tie-up.
However, IRDA said, a tie-up is permitted between one life insurer and one non-life insurer only and
between these two insurers any number of Combi Products may be promoted.
Prior approval needed
The partnering insurers should have in a place an MoU covering the modus operandi of marketing, policy
service and sharing of common expenses - they should also obtain prior approval of IRDA.The regulator
expects that under this product class, the common strength of both insurers are leveraged and consequent
benefits passed on to policyholders.Hence, it has proposed that both the independent products are
integrated as a single product and filed with a common brand name.
The guidelines said the premium components of both risks are to be separately identifiable and disclosed to
policyholders at both pre-sale and post-sale stages. Further, the integrated premium amount of the Combi
Product shall be the basis for reckoning the threshold limit/ applicability of extant regulations.
Lead insurer
IRDA suggested that as two insurers will be involved in offering the product, one of the companies may be
mutually agreed to act as lead insurer, which would play a major role in facilitating underwriting and policy
service.However, IRDA does not absolve either of the companies in relegating the responsibility of proactive
settlement of claims.