IRDAI says insurers can change rates by up to 15% without its permission

In a recent development, IRDAI has permitted insurance companies more freedom in revising rates. Insurance companies can now increase or decrease premiums by 15% depending on their claims experience in a certain sector. Therefore, if an insurer experiences higher claims and higher loss ratios in health or motor going forward, it will be easier for them to increase premiums without having to file with the IRDAI. “If we face a better than expected experience in a certain category, then it is possible that we might pass on the benefits of underwriting profits in the form of lower premiums,” said Rashmi Nandargi, head (retail health, PA and travel underwriting), Bajaj Allianz General Insurance. IRDAI also declared other measures to bring in more transparency. Among the changes are allowing insurers to alter the mode of premium payment to an instalment basis without having to file the product afresh with IRDAI. Insurers will now also be allowed to increase the age band of products without having to file afresh with the regulator.