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Source-This post on Bima Vistaar is based on the article “All-in-one insurance product: Irdai prices Bima Vistaar at Rs 1,500 per policy” published in “The Indian Express” on 3rd May 2024.
Why in the News?
The Insurance Regulatory and Development Authority of India (Irdai) has proposed Bima Vistaar. Bima Vistaar is an ambitious all-in-one affordable mass product which aim to target the rural areas of the country.
About Bima Vistaar
1. About Bima Vistaar: It is a comprehensive insurance product that combines life, health, accident, and property coverage. It is provided by both public and private insurance companies.
2. Initiated by: This is initiated by the Insurance Regulatory and Development Authority of India (IRDAI) as part of its Vision 2047.
3. Aim: The policy aims to address the essential insurance needs of India’s rural population with a single, affordable product. It has been made accessible at Rs 1,500 per policy.
4. Features:
a) This product forms part of IRDAI’s Bima Trinity initiative. It includes:
i) Bima Sugam which includes online insurance marketplace
ii) Bima Vistaar which is a comprehensive bundled policy
iii) Bima Vaahak which works as a distribution channel
IRDAI is banking on the troika to help further its goal of ‘Insurance for All’ by 2047.
b) It is a benefit-based policy: This means that if the event were to occur, the pre-decided amount (the sum insured) will be paid out to the policyholder, or her nominees and the policy will cease to exist.
c) Policy cost: The policy offers life cover for Rs 820, health cover for Rs 500, personal accident cover for Rs 100, and property cover for Rs 80. If taken as a family floater, it costs Rs 2,420, with an extra Rs 900 for additional family members.
d) Benefits of the Bima Vistaar Policy:
i) Increased Insurance Penetration: The policy facilitates the expansion of insurance coverage in rural areas of India, promoting financial security among underserved populations.
ii) Affordable Insurance: With competitive pricing, the Bima Vistaar policy offers accessible insurance solutions to individuals and families and thus ensuring reliable coverage at reasonable costs.
iii) Promotion of Financial Inclusion: By encouraging insurance investment and accessibility, this initiative contributes to broader financial inclusion, empowering more people to safeguard their financial future.
iv) Enhanced Distribution and Adoption: The policy incentivizes agents to promote and sell Bima Vistaar policies to wider distribution and adoption of insurance products particularly in rural and underserved communities.
State of Insurance Sector in India:
1. According to the Economic Survey 2022-23, India’s life insurance density increased from USD 11.1 in 2001 to USD 91 in 2021.
2. The Indian insurance market is poised to emerge as one of the fastest-growing globally in the coming decade. India is currently the 10th largest insurance market globally and is expected to rise to the 6th position by 2032.
Read more: All-in-one policy plan to spread insurance in India
UPSC Syllabus: Indian Economy
