IRDAI permits Insurers for testing of products under sandbox approach

IRDAI has granted permission to insurance companies and intermediaries to test their products under the regulatory sandbox approach for a period of six months (which can be extended upto 12 months) before launching it in the market. “However, if the proposal covers 5,000 persons or completes Rs 50 lakhs of premium or any other parameter which the authority specifies, the proposal will deem to have been completed,” said IRDAI. The regulator has also said that the applicants be it an insurer, insurance intermediaries or any other entity who are planning to apply for the process and test their product should have a minimum net worth of Rs 25 lakhs for last three years. The regulator through the “Regulatory Sandbox Approach” wants to provide a space to facilitate innovations in the insurance sector, make the insurance products more affordable and relevant for the insured and give a boost to insurance penetration.