Bima Trinity: IRDAI may peg Bima Vistaar at Rs 1,500 per individual

The Insurance Regulatory and Development Authority of India (IRDAI) has reportedly discussed the pricing and other modalities of Bima Vistar, which is part of the Bima Trinity. The first-of-its-kind all-in-one affordable insurance product, Bima Vistaar will offer life, health and property cover. The product has been designed to provide a basic social safety net cover with combined features of life, health, personal accident and property insurances.

As per news reports, Irdai has proposed to price Bima Vistaar at Rs 1,500 per policy. This was done at a summit of insurance CEOs, addressed by IRDAI chairman Debasish Panda on Thursday.  

Bima Vistaar will include life cover with a premium of Rs 820, health cover at Rs 500, personal accident cover at Rs 100 and property cover at Rs 80. If taken for the entire family on a floater basis, the policy will cost Rs 2,420, with an additional Rs 900 charged for the rest of the family members.

Each Bima Vistaar policy offers a sum assured of Rs 2 lakh for life, personal accident and property covers. Additionally, the health cover, known as hospi cash, offers a sum assured of Rs 500 for 10 days. The maximum amount available without producing bills or documents is Rs 5,000. Agents selling Bima Vistaar policies can earn a commission of 10 per cent, incentivising wider distribution and adoption of the product.

Narendra Bharindwal, Vice President at Insurance Brokers Association of India (IBAI) said the comprehensive coverage offered by the Bima Vistaar policy underscores its importance in safeguarding individuals and families against various risks and uncertainties. “This initiative not only encourages more people to invest in insurance for their protection but also promotes financial inclusion,” he said.

Claim settlements under Bima Vistaar

It has been proposed that the claim settlement process will vary across different segments. For the property component of the combined solution, settlements will be executed on a parametric basis, facilitating prompt disbursements contingent upon the severity of the event.

In an effort to enhance the product's market penetration, agents distributing Bima Vistaar policies are expected to receive a commission rate of 10 per cent. This incentive is designed to encourage broader dissemination and uptake of the product. It is anticipated that the insurance regulator will officially declare these procedures in the near future.

Insurance penetration

According to a Swiss Re Sigma report, India's overall insurance penetration in the financial year 2022-23 (FY23) decreased to 4 percent from 4.2 percent in FY22. This is significantly lower than the global insurance penetration of 6.8 percent. However, there was a slight increase in insurance density in India, rising from $91 in FY22 to $92 in FY23.

Earlier, Panda had described ‘Bima Trinity’ as the UPI-like moment in the insurance sector. The Trinity will include Bima Sugam, the digital platform, Bima Vistaar and Bima Vahak, a women-centric distribution channel to focus on reaching untapped/rural areas.

In October 2022, the IRDAI established a committee to investigate and propose methods for enhancing coordination in the functioning and activities of Bima Vahak, Bima Vistaar, and the digital platform, Bima Sugam. Bima Vahak will be responsible for distributing these products. Initially, each gram sabha will be equipped with at least one Bima Vahak, tasked with visiting every household in their area and persuading them about the product.

He had said: “Bima Sugam will be the protocol or the platform. Bima Vistaar is a product that we are trying to design it in a manner that will be accessible to the common man. It will be a bundled product of life, health, causality, and property.”