Change in insurance firm’s name won’t affect policy

The change in the names of insurance companies often leaves the policy holder confused. But the consumer has to understand that the change in the name of the insurance company will in no way affect the validity of the product or the services.

For example, Tata AIG life insurance company is now Tata AIA. The joint venture of Tata and AIG has later changed to a joint venture of Tata and AIA and so the change in name. Likewise, Max India sold all their shares in the Max Bupa health Insurance to another company recently. With that the name of the company changed. Fettle Tone LLP is the new partner in the company.

Policy holders need not worry about their interests being affected by the change in name of the company or the management. The rules have been framed in such a way by the Insurance Regulatory Authority that the interests of the consumers are always protected. The IRDA rules don’t allow for changes in the basics of an existing product. If there is a need to make any changes, the permission of IRDA is needed. Permission will be granted only if the explanation for such changes are satisfactory. Even if permission is granted, the insurance company must inform he customers about the changes in the product 120 days before they are implemented.

Similarly, if a company decides to stop any policy, it should give the consumer a policy similar to the existing one or better. There are also directions and rules to increase the policy premium. In the normal course, insurance companies hike the premium depending on various factors. For example, health insurance companies increase the premium on various factors such as increasing cost in the health treatment sector or if the company is facing losses. The companies have to follow these rules even if there is change in the ownership of the company or not.

The insurance company has to seek the permission of the IRDA to change the name of the product. There wouldn’t be any change in the bonus and such discounts that the consumer was receiving under then. Rules stipulate that the consumer should receive all the bonuses and other incentives that the consumer is eligible for.

The changes in the management would not in the normal course affect the policy holder. At the same time, there may be difference in the services that the consumer receives depending on the character of the company. Such changes happen when the management changes.