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HYDERABAD, May 27

FOLLOWING the recommendations of the Tariff Advisory Committee (TAC), the Insurance Regulatory and Development Authority (IRDA) has decided to permit non-life insurance companies to introduce first loss cover, particularly in the householders' policies.

Several general insurance companies had earlier requested the insurance regulator to allow them to introduce first loss cover in the householders' policies.

According to the insurance regulator, householders' package policies issued on first loss basis should include at least combination of one or more of 10 sections mentioned by the regulator, besides fire insurance of building and contents. The insurers were also permitted to add other sections before filing the product with the authority.

These sections include 1) fire insurance of (a) building and (b) contents, 2) burglary, housebreaking, larceny and theft insurance, 3) all risks insurance of jewellery and valuables, 4) accident insurance of fixed plate glasses, 5) breakdown insurance of domestic appliances, 6) breakdown insurance of TV, VCR, VCD, DVD etc., 7) insurance of pedal cycle, 8) insurance of travel baggage, 9) personal accident insurance and 10) public liability and WC liability.

While the first item under the above package policy continues to be under tariff, the rest of the items fall in the non-tariff category.

The policy would come into effect from June 1, 2003, according to the IRDA member, Mr R.C. Sharma.

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