If you are among those customers who have accidentally bought a travel insurance product while booking a flight ticket, the scenario is set to change from October 1. The Insurance Regulatory and Development Authority of India (IRDAI) has brought out new rules governing the sale of travel policies.
The new rules will prevent mis-selling of travel insurance policies to unassuming customers. Here are five ways how the travel insurance rules change:
No customer can be presented travel insurance as a default option. IRDAI has said that customers must be given the option to choose whether or not they want to buy a policy.
At present, travel insurance is presented as a default option on all the travel portals due to which customers unknowingly buy the product while booking tickets. From October 1 onwards, no such pre-selection will be allowed.
Most travel policies sold via online holiday-booking portals do not have details of the terms and conditions of the product being sold. IRDAI has mandated that insurers should make all the product features as well as exclusions more transparent.
For instance, customers presume that baggage is covered by travel insurance. However, several insurers exclude loss/theft from claim payment. Hence, it is crucial that the policyholder understands the terms and conditions before buying the travel policy.
At the time of booking the flight ticket, the travel policy is sold as an add-on product. From now on, that will not be the case. IRDAI has said that premiums can be collected only up to 90 days in advance.
Hence, a travel policy, which is in-force only during the particular travel period, cannot be sold months in advance.
01/10/19 M Saraswathy/Moneycontrol.com
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The new rules will prevent mis-selling of travel insurance policies to unassuming customers. Here are five ways how the travel insurance rules change:
No customer can be presented travel insurance as a default option. IRDAI has said that customers must be given the option to choose whether or not they want to buy a policy.
At present, travel insurance is presented as a default option on all the travel portals due to which customers unknowingly buy the product while booking tickets. From October 1 onwards, no such pre-selection will be allowed.
Most travel policies sold via online holiday-booking portals do not have details of the terms and conditions of the product being sold. IRDAI has mandated that insurers should make all the product features as well as exclusions more transparent.
For instance, customers presume that baggage is covered by travel insurance. However, several insurers exclude loss/theft from claim payment. Hence, it is crucial that the policyholder understands the terms and conditions before buying the travel policy.
At the time of booking the flight ticket, the travel policy is sold as an add-on product. From now on, that will not be the case. IRDAI has said that premiums can be collected only up to 90 days in advance.
Hence, a travel policy, which is in-force only during the particular travel period, cannot be sold months in advance.
01/10/19 M Saraswathy/Moneycontrol.com
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