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IRDA to examine bundling of insurance products

IRDA has noted that the structures of bundled features are usually pre-set and therefore could lead to inadequate cover

June 06, 2012 2:15 IST | India Infoline News Service
To curb forced selling, the insurance regulator (Insurance Regulatory and Development Authority) will examine the concerns related to tying or bundling of insurance products with other goods and services, IRDA chairman J Harinarayan said at seminar on Policyholder Protection and Welfare.
The seminar was held in Kolkata on 2 June 2012. The aim of the seminar was to discuss consumer education in insurance, eliminating mis-selling in life insurance and concerns relating to tying and bundling of insurance with other goods and services.
IRDA said, at present insurance is bundled with other products like online booking of air tickets, credit cards, vehicles, consumer durables, home loans or personal loans. According to IRDA, such insurance products are not always in the interest of the customers.
The regulator said that it is not against bundling of insurance with other products as it provides benefits like extended warranty against damages of consumer durables, personal accident cover or payment protection of credit cards. However, IRDA is concerned about the possibility of forced selling to uninformed customers. It has noted that there are chances of forced selling when the product is sold as a precondition to provide a particular service.
IRDA has noticed certain anomalies in the sales of such products and is in talks with various stake holders in different forums to find out a solution for this. IRDA has further noted that the structures of bundled features are usually pre-set and therefore could lead to inadequate cover.

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