The Insurance Regulatory and Development Authority (“IRDA”) has, vide its circular dated August 16, 2010, notified certain measures to improve the content and presentation of life insurance advertisements, particularly the ULIPs. The new stipulations imposed by the IRDA are as follows:
i) Where any insurance advertisement highlights guaranteed benefits, the underlying conditions (including the cost of guarantee and other charges) for such guarantee need to be prominently mentioned in the advertisement. If the conditions are elaborate, the phrase ‘Conditions Apply’ must accompany the text on guarantee in a font that is at least 50% of the font used to highlight the guarantee. The conditions must be mentioned in a legible font beneath the advertisement, in a section that does not form part of other applicable disclosures.
ii) All insurance advertisements must state the availability of life insurance cover to clearly identify the product as an insurance product.
iii) The brand names of the insurance products should not use terms or phrases that convey a fabricated sense of security.
iv) In case of ULIPs, the actual asset mix of the underlying funds vis-à-vis the IRDA approved asset composition must be made available on the website of the insurance companies on half yearly basis.
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