MUMBAI: The insurance regulator Irdai has said the first phase of the insurance trinity, the launch of which has been in the making for almost two years now, will be ready for 'soft launch' soon. The regulator also said the market has more than enough room for more companies, especially those from the deep-pocketed conglomerates, to come to the insurance space.
Stating that the Bima trinity, which aims to deepen people's trust in the sector and make it affordable, is at the "advanced stages", Irdai chairman Debasish Panda on Tuesday said, “The first phase of the trinity will be ready for soft launch in a couple of months.”
The trinity includes benefit-based product Bima Vistaar, localised women-centric insurance field/sales force Bima Vaahak and an electronic marketplace to universalise insurance called Bima Sugam. Of the three, Bima Vistaar will be the first to be ready for soft launch, he told an industry event organised by CII here. Panda also said once fully launched, it will be a gamechanger in the insurance landscape.
"In insurance distribution, Bima Sugam is expected to cause an explosion, it will become the tech arm of insurance agents, making them more productive and efficient," Panda said.
"The company to run Bima Sugam is already registered, with a new chief executive’s appointment recently, and soon the entire leadership team will be in place," Panda said, adding the norms for Bima Vahak have also been issued and the structure has been finalised.
"The user acceptance testing for tech platform to support Bima Vahak is set to begin shortly with plans for a soft launch of Bima Vistaar in the next couple of months," Panda said, urging insurers to create products similar to Bima Vistaar.
Irdai, which completes 25 years today, has also formulated a state-level insurance committees modelled on the lines of the state level bankers’ committees, where each insurer is entrusted with a state to deepen insurance coverage, the chairman noted.
"Irdai will soon issue a circular detailing the state insurance plan underscoring commitment to take coverage to the last mile," he said.
On the need for more insurers, Panda said for a country of our size with a population of 1.4 billion, 70 insurers across life, general and health insurance is too low a number.
“I want more and more companies to set up insurance ventures, especially conglomerates. We need more players to meet the national mission of insurance for all by 2047,” he said.
"We’ve removed all the entry barriers for floating an insurance company. Today, virtually every class of investor or funds can invest in the insurance business," he said, adding PE funds, institutional investors, venture capitalists and family offices can start an insurance venture.
The regulator, also tasked with the development of the market, has made it very simple for newer applicants to enter the fray, he said, adding that any type of shareholder or promoter is welcome to enter the space.
"I request through this forum that the other conglomerates and other big groups should enter into the insurance sector in India. It's a very exciting time in the sector," he said, adding Irdai also held roadshows in Japan, Europe and the US recently where it told global investors about the opportunities awaiting them in the Indian insurance sector.
He also said Irdai is nudging more players to go for listing in the capital markets to create more transparency and information, which will ultimately benefit shareholders and the sector as a whole.
"We have been softly nudging them to go public after attaining a particular level and growth," he said.
When his reaction was sought on the news of a cut in goods and services tax (GST) in certain insurance products, he said the issue was outside his realm. However, he said Irdai would want to ensure that covers become more affordable, which will help deepen the reach, but was quick to add that cutting taxes is not the only way to do so.
The listing will mean more disclosures, transparency and value for the policyholders and investors, he said, adding that a few IPOs are in the pipeline.