On March 27th Bima Sugam was approved by IRDAI. It will provide different types of insurance coverage to customers from various insurance companies. This article will discuss the intricacies and benefits of Bima Sugam.
1. What Is Bima Sugam?
Bima Sugam, is being referred to as the ‘Easy Insurance’ service. It is an online marketplace where customers are free to choose a suitable and preferred insurance product of their choice like life, health, general, travel insurances, etc. The platform will make available various insurance products from different insurance companies at one place.
One of the best features of Bima Portal is that it is free to use, which means that the user does not need to pay any additional charges for it.
(1.1) Key Points –
- Bima Sugam, which was initially scheduled to launch in January 2023, due to delays, has now been set to launch in June 2024.
- The platform is streamlined, and will offer a paperless claim settlement process.
- Recently, IRDAI (Insurance Regulatory and Development Authority of India), on March 19th, 2024, has given a nod/approval to Bima Sugam application in the market.
- Bima Sugam is a part of Irdai’s Bima Trinity, i.e. Bima Vistaar, Bima Vahak, and Bima Sugam.
- According to the regulators, this digital public insurance marketplace, Bima Sugam, aims to make insurance covers available to all and with empowering and safeguarding policyholders interests and achieving the vision and goal of making Insurance for all by 2047.
- The shareholding pattern of Bima Sugam will be entirely held among all the life, health, and general insurers, in which no single entity will have a controlling stake.
- Bima Sugam, will onboard two nominees from the IRDAI on its board apart from having their company’s own chairman and CEO, who will be appointed after consultation with the IRDAI.
- The platform will be a not for-profit company, which will be formed under Section 8 of the Companies Act, 2013.
(1.2) Aim Of Bima Sugam
The aim of Bima Sugam is to make insurance policies available to each one out there at affordable prices. Also to provide a one stop destination, where users can see, buy, and also compare various policies and schemes easily. Also to empower and protect the interests of policyholders.
The platform will allow various insurance companies to gather at one place and offer their various insurance as well as non insurance products to the users. According to Debasish Panda, the IRDAI Chairman, Bima Sugam will be a game changer in the insurance sector, just like UPI is a game changer in the tech sector.
Also achieving the target as well as the goal to enhance transparency and promote efficiency in order to achieve the vision set by the Insurance sector of India, to make and boost insurance availability to everyone by 2047.
(1.3) Regulations for Bima Sugam – Insurance Electronic Marketplace
According to the draft of regulatory framework for establishments, there are some regulations that have been laid down for the governance and functioning of Bima Sugam Insurance Electronic Marketplace.
The regulations are-
- The platform will be formed as a not-for-profit under the section 8 of the Companies Act, 2013.
- IRDAI will nominate two board members on the board of secretary.
- The main purpose of Bima Sugam will be to establish, facilitate, develop, operate and maintain this one stop platform marketplace work efficiently and providing insurance-related services to the stakeholders.
- Shareholding pattern of Bima Sugam will be shared among three top insurers, which are life, health, and general insurers, in which no single entity will have a controlling stake.
- To manage the proper functioning as well as the risk management of the company and to ensure the well carried out procedures, the board to constitute a risk management committee.
- Also the platform will need a prior approval from the board in order to have authority for appointing the chairperson as well as the CEO.
- The platform will use a consent based architecture for the services, which means that they will not store, maintain, and hold any data. They will provide end-to-end digital solutions to the insurance stakeholders as well as the market.
- The platform will not charge any amount from its users for availing its services.
2. Benefits of Bima Sugam
| Benefits | Reason |
| Singe interface | The platform will act as a single interface between customers, agents , intermediaries and insurance companies for buying and comparing various insurance policies. Resulting in a unified platform. |
| No charges | The platform aims to provide insurance policies and service at affordable prices. Thus it charges no amount on availing its services. Also it’ll help in reducing the commissions paid to middlemen, as it will directly sell policies to the customers. With that it leads to lower premiums for policyholders, as per the industry officials. |
| Privacy and security | The regulations of Bima Sugam, highly prioritizes the security and privacy of its users, assuring them that no information of them is being stored or maintained, reducing the risk of data breaches. |
| Product customization | Bima Sugam platform also provides product customization options for individual needs. |
| Transparency | By providing access to all information related to insurers and policies under one roof, it highly promotes transparency and ensures a faster process of policies, be it comparing, checking, tracking, and settling claims. Also helps in making informed decisions. |
| No paperwork | Bima Sugam has changed the traditional old way of accessing policies. It operates as an online platform and has eliminated the need of maintaining the documents in a physical format. |
| Easy access | It offers easy access to different policies at one single time. Users no longer need to maintain and keep a record of different policies separately. |
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3. Summing Up: Bima Sugam
Bima Sugam is a step taken towards making India supported by an appropriate insurance solution. It will make available almost all the insurance companies under one roof with all their insurance products available at one place, to provide ease and convenience to the customer. Bima Sugam will operate as a fully online digital insurance marketplace, rather than following the traditional insurance market approach.
This is surely a great initiative by the govt. as it will make all insurance companies available at one place. Making easy and convenient for all of us!