As a consequence of the decision taken by the Life Insurance
Council at its 9th January 2004 meeting held in Mumbai,
the Actuarial Society of India (ASI) has withdrawn its
guidance note 5 issued to appointed actuaries.
council had decided to temporarily shelve the proposal
to standardise the sales illustrations of life insurers.
note deals with the manner in which sales illustrations
are to be prepared by life insurers and makes it mandatory
for the appointed actuaries to authorise them.
actuaries have to implement the guidance notes issued
by ASI, failing which the latter can take disciplinary
action against them.
Liyaquat Khan, president, ASI says, the decision of
the Life Insurance Council to postpone the implementation
of its professional guidance note by the life insurers,
has forced ASI to withdraw the note so as to relieve
The norms were to come into effect from 1st January
2004. However the Insurance Regulatory and Development
Authority (IRDA) wrote to the insurers about its decision
to defer them
to industry sources, the sales illustration norms were
discussed at the Life Insurance Council's recent meeting.
The major reason for shelving the proposal is said to
be the inability of the Life Insurance Corporation of
India (LIC) to stick to the January 1st 2004 deadline.
LIC, the implementation of the norms means preparation
of illustrations of hundreds of its products (in different
languages) and making its huge agency force follow the
same, involving huge expense and effort.
to sources, the idea was mooted at the council meeting
to exempt LIC from this but was promptly shot down by
representatives of private insurers as they found it
to be discriminatory in nature.
contacted IRDA member (Life) and chairman, Executive
Committee Life Insurance Council T K Banerjee said:
"I am not in a position to confirm or deny anything."
also see : ASI
norm on sales illustration
defers sales illustrations norms