From 1st September , 2010 onwards a lot of changes has happened in insurance industry. IRDA realized the need of a long term investment portfolio in case of ULIP products. Now a minimum of 5 years lockin has been introduced. Also the various charges are now more or less the same among most companies. The fund allocation has reached a maximum of 96%. Customers has benefited a lot from this move of IRDA. Now insurance companies cannot charge the allocation and other charge very heavily in single year. They have to distribute the charges in five years. So the customers can avail most out of market movements.
In pension plans also some changes has been implemented. Previosly in some policies full withdrawal option was available. But now a customer can commute only 1/3rd of fund value after lockin period and the rest will be contributed towards pension fund.
Most of the insurance companies has introduced plans that gives a minimum maturity amount upon completion of term. Some plans gives a fund value based on highest NAV during the term. These plans helps to minimize the loss of customers on un expected market movements.
The other side of this development is that most insurance companies are forced ro cut short agents first year commision. Some companies distribute the commission over certain period so that an active agent is does not lose his net income. This has made several agents to think of alternate income opportunities. This situation has mostly helped General insurance and Health insurance companies