Keeping up the good work through its “clean-up drive”, Insurance Regulatory and Development Authority (IRDA) has brought the “distribution” of insurance products under its scanner. The regulator would now look at the manner in which the corporate agents, banks and telemarketers are selling insurance products.
IRDA Chairman - Mr. J. Harinarayan said, “Product efficiency alone will not contribute to a healthier market”. He also added that the IRDA would soon come with norms regulating bancassurance (deals that insurers have with banks for selling insurance).
At present, IRDA has published draft guidelines on agent behaviour which prescribes minimum productivity levels, and has also proposed norms which require agents to generate a report analysing the prospects needs before selling them a policy. “The draft norms pertaining to agents’ behaviour are still being examined, but the response from insurers has been positive so far”, the IRDA Chairman said.
We think that while such a move will preclude mis-selling in distribution of insurance products; keeping a constant vigil over this may become difficult.
To read more about IRDA’s clean-up drive click here