IRDAI issues Circular on group life insurance products and other operational matters

Sep 27, 2019 | by Avantis RegTech Legal Research Team

Industry Specific Compliance

The Insurance Regulatory and Development Authority of India (IRDAI) on September 26, 2019, has issued Circular on group life insurance products and other operational matters. The group insurance enhance the access to insurance to both formal and informal sectors of the society, with a view to rationalize and standardize the administration of group life insurance products to protect the interests of the insuring public and insured members of group schemes.

The followings are the directions issued for compliance by all life insurers:-

 Under Group Insurance Products Administration, no group should be formed with the main purpose of availing insurance and person negotiating group rates and then going round finding members to insure will not be considered as a legitimate group for this purpose.

 Where an employer buys a group insurance policy for its employees, the employer may be treated as the master policyholder with the employees being treated as the beneficiaries. The employer shall issue confirmation of insurance protection to individual employees with clear reference to the group insurance policy, the claims of individual persons insured there under may be paid through the employer.

 In non-employer-employee cases, the individual group member would be treated as the insured beneficiary and the master policyholder will only be the holder of the policy.

 The insurer shall conduct a surprise inspection of the books and records of the non-employee-employer group policyholders at least once a year to ensure total compliance with this Circular or require a certificate or require a certificate of such compliance from the auditors of the master policyholder at least once a year.

This Circular supersedes all the guidelines on group insurance policies as far as they pertain to group life insurance. This Circular shall come into force with immediate effect.

[Circular No. IRDAI/LIFE/CIR/172/09/2019]


Related Updates

Alternate Text

Get updates on the go on RuleZbook Mobile App.