The IRDAI has established a committee of 12 members to simplify insurance policy wording by using language understandable to policyholders, the regulator says in a statement.
The committee, headed by Mr L Viswanathan, a member of the Insurance Advisory Committee (IAC), will also include the secretary-generals of the Life Insurance and General Insurance Council along with the president of the Insurance Brokers Association of India (IBAI) and the principal officer (Corporate Agent) of the State Bank of India as well as other senior members of the insurance industry. Further, the committee can also include external experts if found necessary.
This decision follows the IRDAI’s observation that policyholders often find it difficult to understand the terms and conditions in insurance contracts due to the complex language used in the policies which hinder them in making informed decisions while purchasing an insurance policy.
According to the terms of reference given to the committee, they have to examine the existing policies and offer plain words that are legally correct and enforceable, which clearly specify the obligations and responsibilities of the parties involved in the contract. It can also suggest specifications like typefaces for written material
The committee is expected to submit its recommendations within 8-10 weeks.
