IRDA forms panel to examine marketing insurance

Hyderabad: The Insurance Regulatory and Development Authority has constituted a working group to study the possibility of introducing new avenues to market insurance products.

According to a communication from the regulator, it was decided that the committee will have 11 members including Randeep Singh, Senior Joint Director, IRDA as the Member Convenor.

“The Authority has conducted meetings with representatives of life and non-life insurance companies on 16th and 17th January, 2014 and the issue of insurance Marketing Firm (lMF) was discussed at length,” IRDA said.

“During the meetings, it was decided to constitute a working group having five members each from life and non-life companies to study the report of the Govardhan Committee on Distribution Channels and explore the possibility of introducing a new distribution channel on the lines of lnsurance Marketing Firm,” the regulator said.

The group will study and recommend to the Authority on issues such as requirement of capital, geographical spread within which the IMF can operate, distribution costs/ remuneration/incentives to be paid to IMF, fit and proper criteria, quality standards, training and recruitment of sales persons and process of sales, the IRDA said.

IRDA had constituted a committee under the Chairmanship of N M Govardhan, former Chairman of LIC in September 2007 to look into distribution channels- agency, corporate agency, bancassurance, referrals, direct sales.

The committee had submitted its report to the Authority and one of the issues considered by the committee was to allow distribution companies to have multiple tie-ups with insurers, a model akin to independent Financial Advisors.