In a significant move towards enhancing transparency in the insurance industry, the Insurance Regulatory and Development Authority of India (IRDAI) has issued a circular directing all insurers to provide a Customer Information Sheet (CIS) to their policyholders. The CIS is designed to simplify complex policy details and offer policyholders a clear understanding of their insurance coverage.

Live TV

Loading...

The new CIS format will come into effect from January 1, 2024.

The CIS is set to include all basic information regarding an insurance policy, presented in easy-to-understand language. Policyholders will find details such as the policy name and number, coverage information, sum insured, exclusions, waiting periods, limits to coverage, and the claims process.

Explaining the rationale behind this initiative, the IRDAI stated, "It is important for a policyholder to understand the terms and conditions of the policy that has been purchased. Since a policy document may be fraught with legalese, it is imperative to have a document that explains, in simple words, the basic features concerning the policy and provides necessary information."

The need for such a change stems from the growing number of complaints due to a lack of symmetry in information between insurers and policyholders. Policy documents, often laden with legal jargon, can be intimidating and confusing for the average policyholder. The CIS aims to bridge this information gap and empower policyholders with a better understanding of their insurance policies.

Insurers, intermediaries, and agents are required to ensure certain compliances during its implementation — such as the updated CIS must be distributed to all policyholders, either in physical or digital format, with documented confirmation.

The IRDAI also went into specific details of the CIS. "To accommodate regional diversity, insurers must provide the CIS in the local language if requested by a policyholder. The font size on the CIS should be a minimum of 12 (Arial) or larger to ensure readability. All sections of the CIS must be completed, leaving no room for ambiguity," the regulator said.

(Edited by : Shoma Bhattacharjee)

First Published:Oct 30, 2023 5:25 PM IST