IRDAI Circulars

IRDAI Issues Circular on Customer Information Sheet Overhaul for Enhanced Policy Transparency

IRDAI Issues Circular on Customer Information Sheet Overhaul for Enhanced Policy Transparency

The recent circular issued by the Insurance Regulatory and Development Authority of India (IRDAI) on 30th October 2023, bearing reference IRDAI/HLT/CIR/MISC/190/10/2023, addresses a critical aspect of the insurance sector – the transparency and comprehensibility of policy documents for the end consumers. This development, focusing on the revision of the Customer Information Sheet (CIS), represents a significant step in bridging the information asymmetry often present between insurers and policyholders.

Circular Key Highlights

The circular mandates all insurers (except AIC & ECGC) to overhaul their current CIS, emphasizing simplicity and clarity in describing policy terms. This decision emerges against the backdrop of persistent policyholder grievances emanating from unclear and complex policy documentation.

The revamped CIS format, effective from 1st January 2024, includes several notable requirements:

  1. Language and Accessibility: The CIS must be readily available in local languages, catering to diverse policyholder profiles across regions.
  2. Font and Presentation: A minimum font size of 12 (Arial) enhances readability, showing IRDAI’s commitment to not just content but also the accessibility of the content.
  3. Comprehensive Coverage: The document should clearly outline policy coverage, including exclusions, waiting periods, and financial limits. These elements are crucial in setting the right expectations and preventing future disputes.

Practical Implications

From an operational standpoint, insurers need to reexamine their existing policy documents and CISs critically. This revision requires not only a linguistic and aesthetic change but also a strategic realignment towards greater transparency and policyholder education.

  1. Training and Compliance: Insurers might need to invest in extensive training for their staff, ensuring that the nuances of policies are communicated effectively.
  2. Technological Upgradation: Digital platforms should be optimized to support these changes, ensuring that policyholders receive timely and clear information in their preferred language.
READ  IRDAI's New WMD Act Circular: Key Implications and Changes

Case Studies and Examples

Consider the transformation in the communication strategy of a leading health insurance company post the implementation of this circular. The company overhauled its website and customer portals to reflect these changes, leading to a noticeable reduction in customer complaints and improved policyholder engagement metrics. Similar strategies could be replicated across different types of insurance products like life, vehicle, and property insurance.

Future Implications and Insights

Looking forward, this circular could have far-reaching impacts:

  1. Market Competitiveness: Insurers who effectively implement these changes might gain a competitive edge by building greater trust and transparency with their customers.
  2. Product Innovation: Clearer understanding of policy features could drive demand for more tailored insurance products, leading to innovation in product development.
  3. Regulatory Trends: This move might set a precedent for further regulatory actions aimed at enhancing policyholder rights and industry transparency.


The IRDAI’s directive to revamp the Customer Information Sheet marks a pivotal shift towards enhancing the policyholder’s understanding and experience. As we progress, insurers who adeptly adapt to these changes and integrate them into their customer engagement strategies are likely to thrive. This initiative, indicative of a larger trend towards consumer-centric reforms in the financial sector, promises to reshape the dynamics of policyholder engagement in the years to come. The true measure of its success, however, will hinge on its execution by insurers and the resulting impact on policyholder perception and trust.


Trending Posted