Insurance mis-selling is arising because upfront commissions are too high: Ajay Seth, Chairman, IRDAI
The benefit of cost efficiency should be passed on to customers. This entire exercise is intended to ensure that the public and policyholders benefit. For a life insurance savings product, the outcome should be better returns. In general insurance, it should result in better claim ratios. Cost efficiencies should get passed on through lower premiums, or the rate of increase in premiums should be…
Ajay Seth, chairman of the Insurance Regulatory and Development Authority of India (IRDAI), has highlighted the growing issue of insurance mis-selling primarily driven by excessively high upfront commissions. The regulator has issued a consultation paper proposing sectoral reforms to address this problem and improve overall policyholder value.
The main objectives include expanding coverage, enhancing affordability, increasing accessibility, and tackling compulsory bundling to reduce mis-selling. Seth believes that the cost efficiencies resulting from lower commissions should ultimately be passed on to customers, resulting in better returns for life insurance savings products and improved claim ratios for general insurance.
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- Insurance mis-selling is arising: Ajay Seth economictimes.indiatimes.com
