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Time of India
6 days ago
- Business
- Time of India
Leaderless and lagging: India's insurance overhaul stalls without Irdai head since March
Key reforms in India's insurance sector are stuck in limbo following the departure of Insurance Regulatory and Development Authority of India ( Irdai ) chairman Debashish Panda in March. With the top post still vacant since March, the sector is left without regulatory leadership at a time when several major initiatives are awaiting rollout, Times of India reported. The most ambitious of these is Bima Sugam , a centralised digital platform designed to allow customers to compare, purchase, and manage insurance policies online. Although each insurance company has already invested a few crore rupees into the development of this platform, the date of its official launch has still not been finalised. Alongside Bima Sugam, two other major initiatives—Bima Vistaar and Bima Vahaak—are also facing delays. Bima Vistaar is meant to offer bundled insurance coverage to rural populations, while Bima Vahaak is a distribution model driven by women. Both are facing technical and operational hurdles that have stalled their progress. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like An engineer reveals: 1 simple trick to get all TV channels Techno Mag Learn More Undo Plans to shift to a risk-based capital framework and align insurance accounting practices with the International Financial Reporting Standards (IFRS) are also in suspension. These changes were intended to modernise the sector's regulatory oversight and financial disclosures. However, industry unreadiness and lack of clarity around implementation have halted progress. Meanwhile, proposals to allow 100% foreign direct investment in the sector, permit composite licences, and introduce differentiated capital requirements have yet to be passed into law. Plans to list state-run insurers on the stock market are also stuck, facing pushback from within the public sector. Live Events Even as reforms stall, regulatory scrutiny has increased in some areas. The Reserve Bank of India and the finance ministry have raised concerns over banks and automobile dealers forcing customers to purchase bundled insurance products. Regulatory audits have uncovered several worrying practices in retail health insurance, including unclear reasons for claim rejections, steep premium increases, and poor portability. 'If the insurance industry is to grow the way mutual funds did after 2010, we need greater transparency, lower costs, and rebuilt trust,' said Kamesh Goyal, co-founder of Go Digit General Insurance . 'Sebi introduced direct plans and standard charges. Insurance could adopt similar guidelines—such as mandating refunds with interest when loss ratios fall below a certain level.' Goyal said that retail customers were effectively subsidising corporate clients. 'We're not saying distributors shouldn't earn, but loss ratios at 10% are unsustainable. A level of 60-65% is more realistic, accounting for costs and investment income. Once a fair value proposition is in place, mis-selling naturally comes down,' he said. Public sector insurers are also under pressure. Three have breached solvency norms. Even though insurance premiums have grown, the number of individual policyholders has stayed flat, which limits any real gains in financial inclusion. Surety bonds are another area that now demands regulatory attention. These bonds were introduced as substitutes for traditional bank guarantees. But insurers argue they come with higher risk as they lack the protections banks enjoy under existing bankruptcy laws. The delay in appointing a new Irdai chairman has slowed down reform at a time when the insurance industry is in urgent need of clear and forward-looking regulation. (with ToI inputs)
Time of India
6 days ago
- Business
- Time of India
Irdai chief post vacant since March, reforms stall
MUMBAI: Plans to revamp the insurance sector are in limbo, with key reforms stalling after Irdai chairman Debashish Panda left office in March. The post remains vacant, leaving the sector without regulatory leadership at a time when several major initiatives are awaiting rollout. Tired of too many ads? go ad free now The most ambitious among them is Bima Sugam, a unified digital marketplace for policy comparison, purchase, and servicing. With each insurer having invested a few crore in the platform, its launch plan is yet to be finalised. Bima Vistaar, aimed at rural bundled coverage, and Bima Vahaak, a women-led distribution model, are also facing technical and operational delays. Moves to shift to a risk-based capital framework and align insurance accounting with IFRS remain incomplete. These efforts, meant to modernise regulatory oversight and financial disclosures, have not progressed due to a lack of industry readiness and clarity on implementation. Proposals to allow 100% FDI, issue composite licences, and introduce differentiated capital norms have yet to be legislated. Plans to list state-run insurers have also not advanced amid resistance from within the public sector. At the same time, regulatory scrutiny of mis-selling and poor distribution practices has increased. RBI and the finance ministry have flagged concerns over banks and auto dealers forcing customers to buy bundled insurance. Regulatory audits have revealed issues such as opaque claim rejections, sharp premium hikes, and poor portability in retail health insurance. "If the insurance industry is to grow the way mutual funds did after 2010, we need greater transparency, lower costs, and rebuilt trust," said Kamesh Goyal, co-founder of Go Digit General Insurance. Tired of too many ads? go ad free now "Sebi introduced direct plans and standard charges. Insurance could adopt similar guidelines-such as mandating refunds with interest when loss ratios fall below a certain level." Goyal added that small retail customers are often subsidising large corporate groups. "We're not saying distributors shouldn't earn, but loss ratios at 10% are unsustainable. A level of 60-65% is more realistic, accounting for costs and investment income. Once a fair value proposition is in place, mis-selling naturally comes down," he said. Public sector insurers are also under pressure, with three of them breaching solvency norms. While insurance premiums have increased, the number of individual policies has remained flat, limiting its impact on financial inclusion. Another area needing regulatory attention is surety bonds. Though these now substitute bank guarantees, insurers say they carry higher risk due to a lack of protection under bankruptcy laws-unlike banks. The delay in appointing a new chairman has slowed reform at a time when the sector needs urgent regulatory clarity.
Deccan Herald
24-05-2025
- Deccan Herald
Before plane takes off, potholes take over in Bengaluru
Earlier this month, a resident of Hanumanthappa Layout left for the airport at 2.30 am for an early morning flight. However, despite leaving three hours ahead of time, he missed his flight — thanks to the road he took. The Hennur-Bagalur main road landed him in two potholes, leaving him with a bent tyre rim..'It was a blind spot, right at a turn where there were no streetlights. The pothole was like a crater and the right tyre fell right into the middle of the pothole. The rim of the tyre got bent, leading to a flat tyre,' Debashish Panda told DH..'What's surprising is that the potholes weren't at that spot when I had taken the same road to the airport two weeks prior.' he Hennur-Bagalur Road, touted as an alternate road to Kempegowda International Airport, has remained a commuter's nightmare for almost a decade now. From periodic flooding to pothole menace, the road is the least efficient route to commute to the airport, say residents from around the locality. 'Apart from saving on paying the toll charges, there is no other benefit the road provides. A faint spell of rain, and there is about 2 feet of water accumulated at multiple spots on the route. Because of this, the potholes become invisible and driving here becomes more dangerous. I'd much rather take the Hebbal route. It might take 15 minutes longer, but it's much safer,' says Subramanian K, a Hennur resident. .Cab drivers also agree, with many refusing to take the route to get to the airport..'Early on, we would prefer the route as it would allow us to save some money. Plus, with the better roads, it was much quicker. But now the roads are so bad that it ends up damaging the car. With most of us buying our cars on EMI, we can't afford to keep paying for such damages,' said Tausif Pasha, a 36-year-old cab driver. .However, exploring options beyond Hebbal is a necessity, he said..'Last week, after it rained, it took almost three hours to get to RR Nagar from the airport. Getting to the airport hasn't been smooth ride either. Because of a large number of people constantly travelling to the airport, the toll queues are getting longer by the day. Some evenings, the toll queue is over 15 minutes long,' he added..'Not a single stretch free of potholes': Tejasvi Surya after TCS World 10K run in drivers specifically complain about longer queues at the toll booths between 4 pm and 8 pm. .What's the solution?.Alternate routes to the airport are the need of the hour, according to Srinivas Alavilli, Fellow, WRI a short-term solution, he suggests a shuttle service between Hebbal and the airport..'Currently, most of the airport trips are through Hebbal, and that's causing a chokehold in that area. While we develop alternate routes, we can look at the possibility of organising frequent BMTC AC shuttles from Hebbal. Shared transport can help reduce the traffic blocks and improve safety on the flyover,' he said. .Architect and urban designer Naresh Narasimhan opined that the government must promote existing alternate routes, such as the Satellite Town Ring Road, whilst improving the Nagawara access road. If the aim is to improve the traffic congestion on the Hebbal flyover, he suggests an additional bridge..'A 1.2 km long suspension bridge from the Esteem Mall up to Bangalore Baptist Hospital can help ease the congestion. Other than this, the possibility of expanding the Hebbal flyover is limited due to the lakes on either side,' he according to Ashish Verma, professor, IISc, Sustainable Transportation Lab, any intervention done to the flyover to improve congestion will only have a short-term effect..'Making more roads is not the solution. It won't help manage the traffic if the number of vehicles on the road keeps increasing. Instead, the authorities must focus on getting the Metro and Suburban Railway up and running,' he - BMTC takes the back gate Of the 17 existing Vayu Vajra routes only two are directed to the back entrance of Kempegowda International Airport — KIA-8E (from Electronic City) and KIA 15 (from Whitefield). The rest pass through Hebbal and get to the airport through the main entrance. The BMTC soon plans to divert more buses to the back entrance.'The plan is to divert some of the buses coming from Electronic City to the Hennur-Bagalur road towards the back gate of KIA to avoid crowding on the Hebbal flyover. With growing residential development on the Hennur-Bagalur stretch there is demand for more services and also the route will be much quicker' said G T Prabhakar Reddy Chief Traffic Manager. .Temporary solutionWhile Hebbal flyover's new ramp which provides extra carriageway for vehicles coming from KR Puram towards Mekhri Circle can ease the traffic congestion in the area it is not a permanent solution for the traffic bottleneck according to Siri Gowri Deputy Commissioner of Police Traffic (north). 'People prefer Hebbal because they're comfortable with the route. It's up to the government to make the alternate routes that already exist just as comfortable and accessible' she proposes elevated road Former minister and KR Puram MLA Byrati Basavaraj stresses the need for road improvement in his jurisdiction. 'The Hennur-Bagalur Road is an important route but much of the white-topping and other road work is yet to be executed. I've spoken to the authorities concerned about this' he tells DH. A 12-15 km elevated road starting from the Hennur bridge can help divert traffic from the Hebbal flyover and also improve the condition of the alternate route he proposes. Speaking on the lack of street lights on the Hennur-Bagalur stretch he said 'Up until my jurisdiction the roads are well-lit. No has taken responsibility for the rest of the route.'
