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Insurance Regulatory and Development Authority of India has decided to introduced new norms in the month of April, following unit linked insurance from the sector. 

IRDA who are planning to come up with new insurance guidelines in the next financial year since insurance companies are busy this season. IRDA will issue the draft in month of April. 

IRDA says that existing guidelines were not liberal so the new insurance guidelines will give some flexibility to the insurance companies. New norms will protect premium along with adding returns. 

“Guarantee at this level is unattainable and is main reason for drop in sales,” the IRDA official said. 

New product offerings have declined following the introduction of new rules in September. Most insurers say offering 4.5 per cent on one-time premium is feasible compared to long term. Also, a single-premium pension product does not provide long-term protection. 

Last year pension products constituted 20-25 per cent of the total premium collected by the industry. Around Rs 65,000 crore came from the sale of pension products. Total premium rose 18 per cent to Rs 2, 61,025 crore. 

Keeping all this things in mind Insurance Regulator has decided to revised the norms for pension products which will provide some flexibility to Insurance Companies and hopefully enable them to increase sells which drop after September. 

Know more about Pension Products in India.