The Insurance Regulatory and Development Authority of India has constituted a working group to study the scope of ‘title insurance’ in India, the regulator said.
The working group will be required to study ‘title insurance’, identify the insurable risk and define the compensation structure for insurers providing such products, the notification said.
Title insurance is an insurance policy that covers the loss of ownership interest in a property due to legal defects and is required if the property is under mortgage.
The most common type of title insurance is a lender’s title insurance, which is paid for by the borrower but protects only the lender.
The seven member working group will be chaired by Suresh Mathur, senior joint director of IRDAI, and Deputy Director of IRDAI, Pankaj Kumar Tewari will be one of the members. The Chairman will have the authority to invite any other person as ‘invitee’ for the meetings of the group.
It will also be required to suggest the design of the product and the framework for assessment of risk, pricing, reserving and accounting “with actuarial inputs keeping in mind the long term sustainability of the product”.
Further, the committee will also have to look into the reinsurance support available in domestic and international markets.
The role of the working group will also involve assessing the availability of local revenue records, status of digitisation of land records in various states, and legal expertise to support the underwriting and claims management by the insurers.
Source: Asia Insurance Post
Date: 12th June, 2016