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`Insurers have to add value to their products'

Staff Reporter

The present de-tariffing freed the rates of premium

KOCHI: De-tariffing was inevitable in a competitive environment in the insurance field, said G.V. Rao, former chairman of Oriental Insurance Company Limited, and an expert on matters pertaining to insurance. He was speaking on `de-tariffing and its repercussions on the insurance industry' at a function organised by the Oriental Insurance Company Officers' Association.

The present de-tariffing freed the rates of premium. But the basic structure remained as before, according to him. Insurers have to add value to their products. Reputation of insurers was more important than the offer of low prices.

It would be a risky proposition for a client to buy an insurance product based merely on price. Claim settlement would be of utmost importance, he said.

Insurers face competition

Mr. Rao said de-tariffing was good for customers. Insurers faced the prospect of competition from customers through rate negotiation.

Insurers should be professional experts and help the customers to make good decisions.

He questioned the logic behind imposition of 12.24 per cent service tax on health insurance being levied by the Government.

The Government was unable to provide primary healthcare to the masses and was making health insurance more expensive by charging a hefty service tax on it, he said.

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