The Insurance Regulatory and Development Authority of India (IRDAI) vide circular dated 10th June 2022, has extended the ‘Use and File’ procedure for most of the Life Insurance products in order to facilitate the life insurance industry to respond faster to the emerging market needs, in terms of designing and pricing of insurance products and to promote ease of doing business.
The Product Management Committee (PMC) shall review and approve the products/riders in line with Board Approved Product Management & Pricing Policy (BAPMPP) before filing with the Authority under Use & File procedure. The PMC shall ensure that the Benefits reflecting in sales literature, Terms and Conditions reflecting in Policy document shall be consistent with the design approved.
The PMC shall carry out a due diligence process and record its concurrence/sign-off on various product-related risks (such as risks related to capital requirements, profitability, underwriting, reinsurance etc.) to ensure proper product design, appropriate pricing, and filing with the Authority with complete compliance of regulatory requirements.
In case of introduction of a new product/rider replacing an existing similar product/rider, the premium rates and benefits of the new product/rider shall be reasonable and fair. The number of options / variants offered under the product shall be reasonable. All options shall be easily explainable to prospective policyholders. Policyholders shall not be offered any overlapping benefits.
Further with the approval of the PMC, the insurer shall file the documents with the Authority through an online platform (currently BAP), to generate the UIN. The insurer shall launch the product within 15 days from the date of generation of UIN with an intimation to the Authority.
The Authority may, at any time, examine any documents filed by an insurer under this circular and/or the products/riders it offers for sale in the market.
