Indian insurers forbidden from advertising services not part of cover
The regulator said this is ‘unacceptable’.
Insurers, especially motor insurers were ordered by the Insurance Regulatory and Development Authority of India (IRDAI) to stop advertising services that are not part of the insurance cover.
Furthermore, general insurers were forbidden to display discounts with reference or comparison to rates of the erstwhile tariff and to ensure that the discounts and savings on the premium which may be applicable only under extreme or exceptional scenarios shall not be displayed as examples.
According to the IRDAI, some general insurers enter into service agreements with motor workshops and garages for the purpose of providing motor insurance claim services for repair of accident vehicles.
The said services, in addition to claim services, extend to certain assistance services not related to insurance claims such as free pickup and drop of vehicle, body wash, interior cleaning, and more.
“While the bundling of the above facilities with insurance is left to the motor service providers, the general insurers issuing advertisements of the said services, projecting them as benefits provided within the insurance cover is unacceptable,” the IRDAI said in a circular to general insurers.
The IRDAI stressed that the main objective of service agreements with motor garages/workshops shall only be providing insurance services for claims of accident vehicles and they cannot arbitrarily expand to include the scope of services which are not relevant for insurance claims.
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