Insurance selling to be need-based
- Insurance selling to be need-based...Mayur Shetty
Mumbai: Insurance agents will now have to find out prospective buyers retirement and protection needs before selling them a policy. As against the earlier practice of just highlighting the benefits while selling a policy, the insurance regulator has asked life companies to move to needs analysis.
The regulator has called for suggestions on its draft proposal and will finalise the rules once suggestions are in place. The new dispensation is aimed at preventing mis-selling of products and at ensuring that insurance fulfils a need. Insurers are absolved of the need snalysis requirement if the prospect (buyer) voluntarily opts out of the analysis by refusing information.
There should be segmentation of the proposals for which Needs Analysis is required. For instance this might not be necessary for someone buying term insurance against a premium of Rs 2,000 said T Ramachandra, managing director, Aviva India Life Insurance.
The IRDA has first broached the topic of needs analysis in June 2010.