Insurance industry needs more transparency to attract customers

New Delhi, Dec 13 :

The insurance industry needs to adopt more transparency in selling products and settling claims as a means to achieving growth for the industry, a senior government official said Friday.

Speaking at the inauguration of the Federation of Indian Chambers of Commerce and Industry (FICCI) – ‘Health Insurance Vision 2020’ conference here, Insurance Regulatory and Development Authority’s (IRDA) chairman T.S. Vijayan said there is a need to stress on fair pricing, equitable distribution and regulation in the sector. 

“There is need for total transparency starting from the point of sale of the insurance products to the claim settlement and grievance handling; the complexity in the structure should be simplified to make the products appealing to the consumers,” Vijayan said.

The IRDA chairman further said that while scientific pricing is a must, the distribution of products must be such that there is no mis-selling.

“Each person who has bought the product from a company needs to be treated equally and fairly,” he pointed out.

Vijayan was also critical of the differential pricing formula that leads to treating individual and group consumers differently.

The industry said that there is a need to develop relevant strategies for the sector that can enable better public private partnership (PPP) for improved performance.

“Insurers have to encourage management of health by policyholders and formulating target-oriented health insurance programs like those focused at the poor, the elderly and the disabled,” said Nandakumar Jairam, chairman, FICCI Health Insurance Advisory Group.

According to industry estimates, the Indian healthcare industry is poised to grow to $250 billion by 2020. However, even with the annual growth of 20 percent the country’s healthcare spend unfunded by insurance sector will rise to well over $200 billion in the same period.

Other industry stake-holders said that the lack of focus and product variety has hit the industry and that there is a need to innovate across the value chain.

(IANS)