General Insurance products Compliance with File & Use terms and conditions

IRDA Circular: Insurers file with Authority new insurance products and modifications to existing insurance products as required by the File & Use circular no:IRDA/Cir/010/2003 dated 27th March 2006 and subsequent circulars on the same.

Whenever, an insurance product is cleared every insurer should market the product strictly in accordance with the terms and conditions and other features of the product as cleared by the Authority. In the “File & Use”, papers submitted to IRDA, insurers mention a range within which the premium rates would vary depending on unfavourable risk factors.


It is believed that companies quote the rates strictly within the range filed with the IRDA and the variations within the range are as per judgment of underwriters, also any advice given by the Appointed Actuary. It should be ensured that no premium quotation is given which is outside the range filed with IRDA and a rate which the underwriter and Appointed Actuary did not approve.

It has come to the notice of the Authority, however, that some of the Insurers: (i) Offer premium rates outside the range filed with IRDA; (ii) Offer discounts in premiums not specified in the filing; (iii) Offer discount in the premium without specific approval for the same from the underwriter and Appointed Actuary and (iv) Offer enhanced benefits on the products without charging any premiums.

This is unhealthy practice, which besides attracting regulatory penal action, will impact the financials of the Insurer, ultimately affecting the interest of the policyholders and shareholders as well. Such practices should be stopped forthwith. Any deviation from the instructions in this circular will attract penal action.

All CEOs are requested to acknowledge this communication and respond as required within ten days of receipt of this communication.

Member (Non-Life)

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