MUMBAI: The next product filing from Max Life Insurance could be a new idea filed under the most anticipated regulatory sandbox, the company’s deputy managing director V Viswanand told TNIE.
The Insurance Regulatory and Development Authority of India’s (IRDAI) move to allow regulatory sandbox in the sector soon is likely to see insurance firm come up with new ideas, as it gives them an opportunity to experiment with products before the regular launch.
Viswanand said Max Life’s product department has suggested giving a premium holiday after five years, which could be its next product filing. A premium holiday can be a great relief when policyholders face job losses or other contingencies, but at present, the regulations say policy premium has to be paid every year.
“IRDAI is now open to ideas, creating a regulatory sandbox for innovation. They are saying come with ideas … in a month or two, the regulatory sandbox is coming,” Viswanand said. This will allow companies to come up with several new ideas, like an event-based insurance, he said. “Event-based life insurance covers are something we are thinking of, how you can dial up and dial down. May be it will create more excitement among millennials,” Viswanand added. E-commerce has created a base among millennials and BFSI should be like e-commerce, he said.
Under the sandbox, insurance firms can test products up to a period of one year including products, policy, underwriting to claims and distribution, and IRDAI would approve it as a “sandbox product”.Max Life’s recent survey on insurance coverage showed the average age of insurers to be at 36-37 and that chances of policy discontinuation were higher among those who entered early, say by 21-22 years. The survey also showed the uptake of term insurance being low, and an overwhelming number of people feeling the policy cover is inadequate.
“Here, we can do a lot on the product side. Mainly in the protection space, because it is under-penetrated and customers will be willing to take ideas and bets,” Viswanand said.Pay as you go instead of paying upfront for a term plan and plans on the retirement side are areas where innovations are needed, and they will be in the digital space, he said.