IRDAI: Bima Sugam, Bima Vahaks and Bima Vistaar

Subject: Economy

Section: Monetary policy

Insurance in India:

Insurance penetration in India has increased steadily from 2.7% around 2000 to 4.2% in 2020, according to the Economic Survey 2022-23
50% of vehicles are uninsured, and the coverage of property insurance is minuscule. The MSMEs are not adequately covered.
Towards achieving the objective of “insurance for all“, the Insurance Regulatory Development Authority of India (IRDAI) has brought many initiatives and developments in regulations, and also the insurance industry has seen a lot of innovation.
The most recent measure on this by IRDAI has been the conceptualisation of ‘Bima Vahak’, ‘Bima Vistaar’ and the digital platform – Bima Sugam
In 2022 IRDAI constituted a 24-member committee that will explore and recommend on how to bring about synergies in the working and operations of ‘Bima Vahak’, ‘Bima Vistaar’ and the digital platform – Bima Sugam.

Bima Sugam

It will be an online portal that will be one-stop shop for all insurance related queries, policy purchase, claim settlement and insurance advice. It is envisioned as a trusted platform by the IRDAI.
Web aggregators, brokers, insurance agents, bank agents, etc would act as facilitators on this platform for selling insurance policies. The portal would provide all such facilities to policyholders having an e-insurance account (E-IA).
It will simplify and digitise the insurance marketplace— right from buying policies, to renewals, claim settlement, and agent and policy portability.
It will assist consumers with all insurance related queries. It will further act as a window, to view all policies, details and renewal details.
It will help in eliminating the need to fill lengthy forms, to cut down commissions paid to intermediaries.
It will allow for a speedy acceptance of new/sandbox products.

Bima Vahak

Bima Vahak will help insurance products reach the last mile. Each Gram Panchayat would have a ‘Bima Vahak’ who would be tasked to sell and service simple insurance products. It would be similar to the banking correspondents present in rural banking
It will be a women-centric insurance distribution channel. Will also help foster greater trust and build awareness about insurance products in the rural areas of India.
As part of the programme insurance companies adopt a state each and will develop state-level insurance plans with the help of state governments.

Bima Vistaar

It is a social safety net product targeting the untapped geographies of the country and will be available on “Bima Sugam”.
Objective will be to develop an affordable, accessible and comprehensive cover – Bima Vistaar — for rural population in the event of natural disasters, such as floods, and earthquakes, to name a few.
Both Bima Vahak and Bima Vistaar together will help explore how insurance penetration can be increased in semi-urban, rural towns, or in villages.