All-in-one policy plan to spread insurance in India

• If India’s insurance regulator’s plans fructify, households across the country could soon be able to get an affordable single policy that covers health, life, property and accident, get their claims settled within hours, and even secure value-added services at the time of buying a policy.
• In an ambitious bid to expand the poor insurance penetration in the country, the Insurance Regulatory and Development Authority (IRDA) is devising a new affordable bundled product to give citizens protection against multiple risks, and seeking to expedite claim settlements by linking death registries onto a common industry platform.
• These initiatives are part of a broader overhaul — including legislative amendments to attract more investments through differentiated licences for niche players similar to the banking sector — with an eye on making insurance “available, affordable and accessible” to all citizens with a “gram panchayat- to district- to State-level’ approach.

‘UPI-like moment’

• They are striving to create an “UPI-like moment” in insurance through a plan worked out with general and life insurance firms that they termed “Bima Trinity”
• A new Bima Sugam platform will integrate insurers and distributors onto one platform to make it a one-stop shop for customers, who at a later stage can pursue service requests and settlement of claims through the same portal.

IRDAI

Insurance Regulatory and Development Authority of India is constituted by an act of parliament. The Authority is a ten-member body, specified in section 4 of the IRDAI Act of 1999, consisting of

• a Chairman;
• five whole-time members;
• four part-time members;

All of the appointments are done by the Government of India.

Aim of IRDAI

• Ensuring fair treatment for policyholders and defending their interests.
• To promote the insurance industry’s rapid and orderly expansion (including annuity and superannuation payments), which will benefit the general public, as well as supply long-term finance for the economy’s rapid expansion.
• To take action when such standards are not sufficient or are not adequately applied.
• To ensure that the industry operates with the appropriate level of self-regulation in accordance with prudential regulation rules.
• To establish, encourage, oversee, and uphold high standards for the competence, moral character, and financial stability of those it regulates.
• To ensure prompt resolution of legitimate claims, to stop insurance fraud and other wrongdoing, and to set up efficient grievance redressal mechanisms.
• To encourage fairness, openness, and lawfulness in financial markets that deal with insurance, and to create a solid management information system to impose strict requirements for the financial soundness of market participants.

Objective of IRDA

• The IRDA’s primary goal includes fostering competition to boost consumer choice and lower prices while maintaining the market’s financial stability in order to increase customer satisfaction. The primary objective of the IRDA is:
• To safeguard the policyholder’s interests and ensure fair treatment.
• To effectively regulate the insurance sector and guarantee its healthy financial standing.
• Establishing regulations on a regular basis to make sure the sector runs well.

Powers, and Functions of IRDAI

• Section 14 of the IRDAI Act, 1999 lays down the duties, powers, and functions of IRDAI.
• Issue a certificate of registration to the applicant, renew, alter, withdraw, suspend, or terminate such registration.
• Safeguarding the interests of policyholders in matters pertaining to policy assignment, insurable interest, payment of insurance claims, policy surrender value, and other terms and conditions of insurance contracts.
• Specifying the necessary credentials, moral standards, and practical training for insurance intermediaries and agents.
• Encouraging efficiency in the management of the insurance industry.
• Charging fees and other amounts in order to carry out the objectives of this Act.
• Governing insurance firms’ financial investments.
• Rules governing the preservation of the solvency margin.
• Resolution of conflicts involving intermediaries or insurance intermediaries and insurers.
• Monitoring the activities of the Tariff Advisory Committee.
• Contacting insurers, intermediaries, insurance intermediaries, and other organizations associated with the insurance business to request information, inspect, inquire, and undertake investigations, including audits.
• Control and regulation of the rates, benefits, terms, and conditions that insurers may offer in relation to general insurance business if the Tariff Advisory Committee has not done so in accordance with section 64U of the Insurance Act of 1938 (4 of 1938).

IRDAI in Health Insurance Business

• The apex authority, the IRDA, is in charge of establishing new regulations and standards for health insurance in the country.
• The Insurance Regulatory and Development Authority of India (IRDAI) has been continuously working to lessen the compliance burden of all the regulated organizations as part of its promotion of ease of doing business for insurance companies.

The following are the new IRDA guidelines that the regulator has released for health and mediclaim insurance in 2020:

• If the policyholder has renewed the policy for eight years without interruption or lapse, the insurer cannot deny a claim. The moratorium period will be used to refer to this time frame. Except in cases of fraud or when the claim is brought against a policy exclusion, the insurer cannot appeal the denial of the claim to the IRDA.
• With the advent of digitization, the medical industry has evolved, and one can now contact a doctor online. The IRDA has requested that insurance companies include telemedicine consultations in their insurance policies.
• The insurance provider is responsible for paying interest on the claim amount if the insurer delays the claim. It should guarantee that the claim is settled within 30 to 45 days following the policyholder’s last document submission.

IRDAI on Ease of Living of Senior Citizens

• IRDAI has relaxed the requirements for submitting a separate proposal form for taking Immediate Annuity products from National Pension Scheme (NPS) earnings in this direction to make life easier for elderly persons.
• In the existing situation, NPS retirees submit an exit form to NPS and a proposal form to insurers at the time of superannuation.
• Additionally, in order to encourage the adoption of technology, insurers have been urged to use Adhaar-based authentication for the validation of life certificates, such as Jeevan Pramaan, a Government of India project on biometric-enabled digital services.

China constructing model villages opposite the LAC

China is continuing to expand the network of model villages, or Xiaokang (moderately prosperous) villages, opposite the Line of Actual Control (LAC) in the Middle and Eastern sectors, according to official sources.

Opposite Barahoti, the Chinese are building villages at a rapid pace, sometimes 300 to 400 houses within 90 to 100 days, a source said. Small patrols are being seen in the Mana, Neeti and Thangla areas.

In Arunachal Pradesh, opposite the Kameng area, two villages have come up in Cuna country consisting of 41 dwelling units and there are about 200 inhabitants from the Menba ethnic community, the source said.

As reported earlier, a large number of Xiaokang villages are under construction all along the LAC, including at the Chumbi valley facing the strategically crucial Siliguri corridor.

Amid reports of shortage, FSSAI to hold surveillance on milk and milk products

Aimed at curbing adulteration of milk and milk products, in both organised and unorganised sectors in all the districts of the States and Union Territories, the Food Safety and Standards Authority of India (FSSAI) will conduct nationwide surveillance this year.

The sector also continues to grapple with the hit it took during COVID-19 and more recently the lumpy skin disease (which caused the death of 1.9 lakh cattle) and fodder inflation at 30%.

FSSAI conducted a milk survey in selected 12 States [which included 10 States where the lumpy skin disease was prevalent]. The administration of antibiotics/veterinary drugs in affected animals and spraying insecticides in the sheds may result in residual contamination in milk.

In order to ascertain the safety of milk, the presence of antibiotics, pesticide residues and heavy metals were assessed in the samples collected. The outcome of the survey revealed that the milk sold in the selected 12 States is largely safe for consumption

FSSAI

• Food Safety and Standards Authority of India (FSSAI) is an autonomous statutory body established under the Food Safety and Standards Act, 2006 (FSS Act).
• Ministry of Health & Family Welfare, Government of India is the administrative Ministry of FSSAI.
• Headquarters: Delhi.
• FSS Act, 2006 consolidates various acts & orders that had earlier handled food related issues in various Ministries and Departments, such as–
  • Prevention of Food Adulteration Act, 1954
  • Fruit Products Order, 1955
  • Meat Food Products Order, 1973
  • Vegetable Oil Products (Control) Order, 1947
  • Edible Oils Packaging (Regulation) Order 1988
  • Milk and Milk Products Order, 1992
• These were repealed after commencement of FSS Act, 2006.
• FSSAI was consequently established in 2008 but work within the Food Authority effectively began in 2011 after its Rules and key Regulations were notified.
• This marked a shift from a multi-level to a single line of control with focus on self-compliance rather than a pure regulatory regime.

7 Key Processes

• Set standards of food products
• Develop safe food practices
• License food businesses
• Ensure compliance through inspections
• Test food for standards
• Train and build capacity
• Citizens Outreach

Functions

• Framing of regulations to lay down the standards and guidelines of food safety.
• Granting FSSAI food safety license and certification for food businesses.
• Laying down procedure and guidelines for laboratories in food businesses.
• To provide suggestions to the government in framing the policies.
• To collect data regarding contaminants in foods products, identification of emerging risks and introduction of rapid alert system.
• Creating an information network across the country about food safety.
• Promote general awareness about food safety and food standards.

FSSAI Legislative Framework

• Highlights of the Food Safety and Standard Act, 2006
  • The Act aims to establish a single reference point for all matters relating to food safety and standards, by moving from multi- level, multi-departmental control to a single line of command.
  • The Act established FSSAI and the State Food Safety Authorities for each State.
• Highlights of Food Safety and Standards Rule, 2011. The Rules provides for:
  • The Food Safety Appellate Tribunal and the Registrar of the Appellate Tribunal, for adjudication of food safety cases.
• Highlights of Food Safety and Standards Regulations 2011
  • It covers Licensing and Registration, Packaging and Labelling of Food Businesses, Food Product Standards and Food Additives Regulation.
  • It prohibits and restricts on sales or approval for Non-Specified Food and Food Ingredients, such ingredients may cause harm to human health.
  • It provides for Food Safety and Standards on Organic Food and regulates Food Advertising.

Structure of FSSAI

• The FSSAI comprises of a Chairperson and twenty two members out of which one – third are to be women.
• The Chairperson of FSSAI is appointed by the Central Government.
• The Food Authority is assisted by Scientific Committees and Panels in setting standards and the Central Advisory Committee in coordinating with enforcement agencies.
• The primary responsibility for enforcement is largely with the State Food Safety Commissioners.

Challenges and Shortcomings Faced by FSSAI

• The “petty manufacturers, retailers and hawkers” are exempted from FSSAI ambit. These segments greatly contributes to unorganised food sector and due to its low prices, most of the population prefer food consumption from these segments.
• Lack of infrastructure such as food testing laboratories. There are only 87 National Accreditation Board for testing and calibration Laboratories (NABL) accredited Labs, where as there are more than 1500 private labs in India.
• Shortage of qualified manpower and functional food testing equipment in state food laboratories and referral laboratories resulted in deficient testing of food samples.
• There is an acute shortage of licensing and enforcement officers in the states which severely affected food safety measures.
• The body has been only prescriptive in nature and failed to ensure safety, quality and hygiene in food industry.
• There are only 377 products mentioned in the FSSAI regulations – whereas other countries have over 10,000 standards. Moreover, the list is not regularly reviewed.
• FSSAI is highly underfunded to monitor the widening ambit of food laws. Also, there are no standard practices for food inspection, the process being mostly discretionary.
• Cumbersome and lengthy approval procedures have delayed the pre-launch approvals for products from the FSSAI for over a year.
• Consignments of imported food products often remain stuck at the ports awaiting clearance by the FSSAI – sometimes due to small issues like labelling of the packages not conforming to arbitrary norms specified by the FSSAI, which differ from the widely accepted global standards.
• Differences of opinion between the food regulator and the food processing ministry also handicap the FSSAI functioning.
• According to a CAG Report, FSSAI is yet to frame regulations and guidelines to govern different procedures.
• The CAG also found that "licenses were issued on the basis of incomplete documents in more than 50 per cent of cases, checked in Audit".

Landmark cases

• Nestle India Limited Maggi Case: The maggi noodles were reported with excess lead unfit for human consumption and FSSAI prescribed for ban.
• Cadbury India: It was reported that worms was found in Cadbury''s Dairy Milk. The FSSAI declared packaging was not proper or airtight and made it mandatory to change the packaging.