New norms for ULPs on cards

New norms for ULPs on cards

Irda Chairman J Hari Narayan (right) with BCIC President Shekar Viswanathan at a seminar on Insurance – Policy & Regulatory Aspects, in Bangalore on Friday. DH Photo

Addressing the ‘Insurance — Policy & Regulatory Aspects’ seminar organised by Bangalore Chamber of Industry & Commerce (BCIC), he said certain policy guidelines, which were unclear, will be amended ensuring more transperancy in quantum of commission being paid to the agents and amount of risk the customer is undertaking. 

The move comes at a time when companies may start pushing universal life policies post September 1, 2010 when new guidelines for Ulips came into play, resulting in lower margins being generated from the product. Universal Life Policies (ULPs) come with features of both traditional and unit-linked plans. However, unlike Unit Linked Insurance Plans (Ulips) , both the tenure and sum assured on universal policies can vary.

On the new guidelines, he said “the main objective was to control costs and bolster consumer confidence. I expected dip in sales of Ulips after the changes, but the scenario will improve in the coming year. ”

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