IRDAI permits modification of group insurance policies

The Insurance Regulatory and Development Authority (IRDA) on Friday permitted life insurers to modify the terms of 'Group Credit Life Master Policies' of entities who have availed moratorium on repayment of loans announced by the Reserve Bank in view of the COVID-19 pandemic.

The life insurers, according to the Insurance Regulatory and Development Authority of India (Irdai), are allowed to "suitably modify the term and sum assured under the schemes, against the additional premium as may be required, so that they may continue to be covered as per the revised loan repayment schedule."

This facility, however, will be available to only those entities which have opted for moratorium in terms of RBI's announcement with regard to repayment of loans.

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"The modification shall be limited to the extent required to ensure that the coverage under the scheme matches the revised loan repayment schedule," Irdai said in a circular.

The coverage for the extended period will have to be priced on the same terms as the original cover, Irdai said.

Life insurance companies had approached the regulator to permit them to make certain modifications in Group Credit Life Master Policies issued by them so as to align the cover available under such schemes with the revised loan repayment schedule.