Term insurance plans to get cheaper
Posted on June 10, 2010
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Term insurance policies will provide pure life cover with no maturity or survival benefits. Since there are no maturity benefits in these policies, they are not as popular as, they say, the money back covers. Currently, the insurers have to maintain a solvency margin of 150 per cent on insurance products.
Their move will ease the capital requirement by one third for term policies for both the individual and group policies. Solvency margin requirements are the most prudential norms on capital requirement for insurance companies. They are as equivalent of the capital adequacy ratios for the banking industry. The insurers are likely to pass on their benefit to customers.
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