Insurance sector plays a very vital role in stimulating the economy. It promotes financial stability, facilitates trade and commerce, manages and strengthens the risk-taking ability. IRDAI is responsible for monitoring the entire insurance sector in India and acts as the custodian for all insurance consumers’ rights.
In light of the incessant spread of Covid-19 and prolonged lockdown in India, IRDAI has taken several steps by way of issuing circulars and press releases to provide guidance, clarification and relaxation to insurers and policyholders with the view to provide necessary support and protection in the present unprecedented circumstances.
A. GENERAL DIRECTIONS TO INSURERS
1. IRDAI has vide its circular dated March 30, 2020, advised insurers to:
- ensure maintenance of essential insurance services during the lockdown with absolutely necessary staff;
- put in place a business continuity plan;
- set-up a crisis management committee to ensure minimum business disruption;
- devise policies to cover risks that arise out of Covid-19 spread;
- establish a simplified and expedite mechanism for dealing with claims arising on account of Covid-19 spread; and
- provide an option to defer the date of travel without imposing any additional charges on policyholders, whose travel insurance policies are valid from March 22, 2020 till April 30, 2020.
2. IRDAI has further granted insurers with:
- thirty (30) days of grace period to dispatch policy related documents issued between March 15, 2020 and April 20, 2020; and
- twenty-one (21) days of additional response time to handle complaints received by insurers from March 15, 2020 till April 30, 2020, except for the complaints pertaining to Covid-19. Rajani Associates
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