There has been a major change in the general Insurance sector in India post Privatization. Fire, Engineering, Motor and Workmen compensation insurance, currently governed by tariffs has been brought under a free pricing regime (detariffed). Detariffing is in fact being done in two stages. In the first stage, only the pricing is being freed, while policy wordings continue as per current tariff wordings. In the second stage, policy wordings will also be freed. In other words insurers will be free to issue policies with wordings different from those, which are mandated by the current tariff (Subject however to compliance with IRDA’s (Insurance Regulators) file and use procedure).

Free pricing regime is both an opportunity and threat for both the insurer and insured. For the insurer it gives an opportunity to price insurance based on risk perception and loss ratio . For the insured it is an opportunity to get Insurance cover at a lower premium.

Your Insurance Broker will now play a more challenging & meaning full role in the present scenario. After privatization in insurance industry, there are now 21 Insurance companies doing General insurance business. Hence the broker will negotiate the most competitive premium from various insurance companies to minimize your premium.