1.     India has been seen to be a very exciting market and a pioneer in the Microinsurance sector in the world and has provided an example with its Microinsurance regulations.

2.     Microinsurance is specifically intended for the protection of low -income people, with affordable insurance products to help them cope with and recover from financial losses. It promises to support sustainable livelihoods of the poor. Liberalization of the insurance sector and Government Schemes has created new opportunities for Microinsurance to reach the vast majority of the poor, including those working in the informal sector.

3.     Even so, market penetration in Microinsurance is seen to be low in India.

4.     The market, so far, is seen to be largely supply driven. Among others,  the product design, ease of underwriting, distribution, awareness creation, easy premium payment system, simple claims processing and use of technology  would be key for success of the Microinsurance market.

5.     Considering the above, the competent Authority has decided to set up a committee with the following members:

6.     The Terms of Reference of the Committee are as below: 

i.                    Review the existing regulatory framework on Microinsurance in India as well as in other jurisdictions and suggest improvements in the Indian framework;

ii.                  Recommend how to increase Microinsurance penetration;

iii.                Suggest product designs with customer friendly underwriting including easy premium payment methods and simple claims settlement procedures;

iv.               Suggest changes in the distribution structure, if any, including mobile based and technology driven solutions;

v.                 Suggest creating effective awareness programmes including training programmes for the distribution channels.

vi.               Any other matter relating to Microinsurance.

7.     The Committee shall meet as often as required and submit its recommendations within three months of publishing of this order.

Yegnapriya Bharath

Chief General Manager (NL)