Insurance Bill: Know the Big Change That Will Impact Your Policy Claim

  The insurance bill was passed by the Rajya Sabha on Thursday, paving way for foreign companies to raise their stake in domestic insurance companies to 49 per cent. The passage of the bill is being hailed as a big positive for the country as it increases India's visibility among foreign investors.
This article focuses on the impact of the new insurance bill for policyholders:
1) One new provision in the insurance bill is being considered to be "retrograde" for policyholders. The onus to prove that a wrong statement was not made at the time of taking the policy would lie with the policyholder and not the insurance company, says former LIC Chairman SB Mathur.

"The move will adversely impact policy holders especially because the track record of some insurers is not very good," he added.
  Earlier, companies had to prove that a policyholder had "deliberately" concealed information while taking the policy. The word "deliberately" has also been taken off, Mr Mathur said.
"Imagine if a person dies and his widow and children will have to prove why the husband or father made a wrong statement," he added.

2) According to the new bill, an insurance policy cannot be challenged on any ground after three years. This means if a fraud is detected three years after the policy has been in force, insurance companies will have to pay the policy holder.