To help customers understand insurance products better before entering into a contract, HDFC Life Insurance Company has started a new initiative where the policy buyer would have to fill in an extra questionnaire. Called ‘Most Important Document (MID)’, the one-page questionnaire has become a mandatory element of the company’s policies from April 8 this year. It attempts to explain the key product features to customers who will be required to fill the page and sign across, thereby acknowledging full understanding of the product at the time of filling up the proposal forms.

“Customers should buy products for the right reasons and we encourage them to spend time in understanding the products they plan to buy in line with their needs, read up all necessary product literatures, and fill up the MID form. “The objective is to minimise mis-sale,” said Amitabh Chaudhry, MD and CEO, HDFC Life. The insurer has said that its promoters will add a further ` 150 crore in 2011-12 to its paid-up capital of ` 2,170 crore to support its 10-year-old business.

“We will hopefully break even this fiscal. It is high time that the stakeholders got returns for their investments. In a new business you usually make a loss in the first year, but as the existing customer base increases or if people surrender, you generate cash,” said Amitabh Chaudhry.

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