New IRDAI rule: Forced to buy travel insurance by agent? Do this

New IRDAI rule: Forced to buy travel insurance by agent? Do this
30 Sep 2019

IRDAI has issued certain norms to be followed for the travel insurance policies offered under Group platform or through any travel agency or portal.

The buyer shall be able to specifically choose whether or not to buy the coverage.

The Insurance Regulatory and Development Authority of India (IRDAI) has introduced certain customer-friendly guidelines for the General and Standalone Health Insurance Companies to offer on their travel insurance products. The guidelines make it clear that in case of domestic travel, the premium cannot be received by the insurers more than 90 days in advance from the date of commencement of the risk or while purchasing the travel tickets, whichever is earlier. However, covers towards overseas travel may be issued at any time and there will not be any time stipulation applicable to the overseas travel cover.

Further, IRDAI has issued certain norms to be followed for the travel insurance policies offered under Group platform or through any travel agency or portal.

Here are some of the important travel insurance guidelines:

  • Insurers are responsible to ensure that an informed choice is made by the persons who are going to be insured.
  • The prospect shall be able to specifically choose whether or not to buy the coverage.
  • The insurer’s name, the premium amount needs to be specifically disclosed as the cost of travel cover, at the time of opting to buy a travel insurance cover. The tax portion needs to be shown separately.
  • Insurers shall ensure that any portal or App providing the travel insurance coverage shall not pre-select the option of buying the travel cover as a default option.
  • Where selected to buy, an option shall be provided for opting out or de-selecting the option before concluding the transaction.
  • There shall be a provision to let the person to be insured buying a travel cover go through the benefits, terms and conditions offered under the travel insurance cover on the screen itself and consent shall be obtained in the form of selecting a radio button by the prospect / policyholder in confirmation of having read and understood the terms and conditions.

“Though domestic travel insurance remains a small portion of the business, the new norms announced by IRDAI will benefit both the insured and the insurers. Considering that the changes come in the backdrop of the travel insurance business for the industry gaining momentum, the move of providing those booking tickets the option of whether they want the cover or not is a welcome step. The consumer thus will not only be aware of what he is buying, but also get to read the terms and conditions and agree to them. The norms will bring in greater transparency for the insured and insurer and also curb mis-selling,”says Gurdeep Singh Batra, Head , Retail Underwriting, Bajaj Allianz General Insurance.

So, the next time when you make your travel plans and if you are asked to add a travel insurance policy, you know what to do. If a travel insurance cover is to be added, read the inclusions and exclusions before buying it.

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