Mumbai: The tariff advisory committee (TAC), the statutory body for fixing tariffs on domestic non-life insurance policies, will be abolished by 2005, according to Insurance Regulatory Development Authority (IRDA) chairman N Rangachary. Insurers will then be allowed to fix their own premiums on policies, paving way to competitive pricing on policies.

Rangachary, however, said IRDA would intervene in the market on the matter of pricing policy of the companies in case incidents of unhealthy competition among the companies surface, leading to undercutting of price, which could result in insolvency of companies.

IRDA will continue to play a crucial role even after the market forces take over, and the interests of consumers as well as the industry will be taken care of, he said.

In the case of competitive tariff pricing, corporate risk managers will have to play a more active role. From being mere facilitators of insurance, the risk managers must be more knowledgeable about the products, pricing and discounting, he said.