New Click here to Enroll for SIDBI MSME Expert Class by ex-GM, SBI on Nov 24

    Register

    Question

    What is the primary purpose of the Insurance Regulatory

    and Development Authority of India (IRDAI) approving the reduction of interest rates for revivals or policy loans?
    A To increase the profitability of insurance companies Correct Answer Incorrect Answer
    B To encourage new policyholders to join existing policies Correct Answer Incorrect Answer
    C To provide additional benefits and flexibility to existing policyholders Correct Answer Incorrect Answer
    D To reduce the administrative burden on insurance companies Correct Answer Incorrect Answer
    E To limit the availability of policy loans Correct Answer Incorrect Answer

    Solution

    The Insurance Regulatory and Development Authority of India (IRDAI) approved the reduction of interest rate for revivals or policy loans, among others. These are applicable to existing policies that were closed for new business but still exist on insurers' books   The alterations are introduced to give additional benefits and flexibility to existing policyholders, ensuring they are not adversely impacted.   The insurance regulator has decided to allow the addition of existing riders which are open for sale, the addition of premium payment modes, reduction in interest rate for revivals or policy loans, and the addition of one or more payment frequencies to income benefits payable to policyholders.

    Practice Next