The insurance regulator has tightened the guidelines on advertisements related to insurance products, especially, those of guaranteed products and unit-linked insurance plans (ULIPs).
Issuing insurance advertisement guidelines, the Insurance Regulatory and Development Authority (IRDA) has asked insurance companies to clearly mention the conditions under which guarantee benefits are offered.
"If the underlying conditions are very elaborate, the text/wording on guarantee must be accompanied by the phrase 'conditions apply' in a font that is at least 50 per cent of the font used to highlight the guarantee. These conditions must be distinctly mentioned in a legible font beneath, not making it part of other applicable disclosures," the guidelines say.
They further say that all insurance advertisements must prominently state the availability of underlying element of 'life insurance coverage' to clearly identify the product as an insurance product.
With regards to unit-linked life insurance products, the guidelines stipulate that insurance companies must display the actual asset mix of various underlying funds vis-à-vis the asset composition of approved asset pattern on their website at least on a half yearly basis. This information on investment updates is to ensure that clear, actual and timely information is made available to prospects to make an informed financial decision.
IRDA has also asked insurers to avoid using brand names of insurance products that convey a fabricated sense of security.