Free Press Journal

Insurance e-commerce draft policy lauded by insurance cos


Kolkata: Insurance companies are enthusiastic about the proposed guidelines on selling and servicing of policies through e-commerce platform that aims to do away completely with any kind of physical intervention. The Insurance Regulatory and Development Authority of India (IRDAI) has come out with the exposure draft on selling and servicing insurance policies through e-commerce platform for comments before final regulation is notified.

“This will go a long way in penetration of insurance products. It is a great effort and it will induce lot of benefits to the customers in terms of accessibility of products for customers of smaller towns not encouraged by agents and advisors due to lack of adequate remuneration for them,” Bajaj Capital group CEO & Director Anil Kumar Chopra said.

He was speaking on the sidelines of an insurance summit here today. Chopra said the country’s accumulated number of issued polices is 12.5 crore and coverage of population will be far low as there would be multiple policies by a single person for health, motor and life.

“So the online issuance of policy without any requirement of physical signature process with an authentication process will help customers to buy property insurance and other term policies online at ease and they would not be pushed by agents,” he said.

National Insurance Corporation chairman and managing director K Sanath Kumar said the company is examining the e-commerce selling and servicing front. “Online selling was there but it lacked proper guidelines.”

“The Insurance Self-Network Platform will undertake Insurance e-commerce activities in India such as selling and servicing of insurance products,” IRDAI said in regulations on insurance e-commerce.

The draft elaborates on participants who can set up Insurance Self-Network Platform. These include entities granted certificate of registration by IRDAI such as insurers, insurance intermediaries, insurance agents and any other entity recognised by it.

Bajaj Capital is likely to unveil an online interface with desktop and mobile app spending Rs 2 crore to Rs 3 crore to sell entire portfolio of financial products, Chopra said. IRDAI has also relaxed the norm for aggregators who are also online insurance sales channel and allowed them to issue polices up to Rs 1.5 lakh from Rs 50,000.

“We have relaxed insurance policy norm for insurance aggregators by increasing the policy amount to Rs 1.5 lakh,” IRDAI member V R Iyer said. “Given the large number of attrition among the insurance agents we have allowed agents to open firms and selling products of two life, two non-life and two health insurance companies. Earlier, they were not allowed to open agency firm and sell products of more than one companies,” Iyer said.