Title: Exposure Draft
Reference No.: --
IRDAI (REGISTRATION OF CORPORATE AGENT) REGULATIONS, 2015
Insurance Regulatory and Development Authority of India
Consequent upon promulgation of Insurance Laws (Amendment) Ordinance, 2014 and passing of the Insurance Laws(Amendment) Bill, 2014 by the Parliament, corporate agents have been defined as intermediary and insurance intermediary under section 2(1)(f) of the IRDA Act, 1999. This necessitated the Authority to draft a new set of regulations for registration of corporate agents as an insurance intermediary. These regulations, after notification in the official gazette, will replace the erstwhile IRDA(Licensing of Corporate Agents) Regulations, 2002.
The draft contains, amongst the others, the following.
1) Applicant to include the following
(i) An entity whose principal business should be other than distribution of insurance products and insurance distribution is a subsidiary activity. Example – banks, NBFCs etc;
(ii) An entity whose principal business is to exclusively carry on insurance intermediation
2) There are four categories of corporate agents viz. life, general, health and composite;
3) Each corporate agent shall have arrangements with a maximum of three insurers in each category;
4) There shall be a Principal Officer, who should be a graduate to ensure overall supervision of the corporate agent.
5) The corporate agent shall engage the services of Specified Persons who will be soliciting and procuring the business. The Specified Persons shall be at least 12th pass and also have under gone training and passed the examination;
6) For exclusive corporate agent, a minimum share capital and networth of Rs.50 lakhs has been prescribed;
7) An application processing fee of Rs.10,000/-, which is non-refundable, has been suggested. In addition, the applicant upon receipt of the in-principle approval and also at the time of renewal has to remit a fee of Rs.25,000/-.
8) Requirement of PI policy of two times the remuneration is also suggested in the draft.
9) No corporate agent shall place more than 90 per cent of the premium with any one insurer in the first year, which limit should gradually come down to 75 per cent and 60 per cent during the second year and third year respectively. From the fourth year onwards, this limit shall not be more than 50 per cent.
10)Disclosures to the Authority, conditions for arrangements with the insurers are also included in the draft.
The draft regulations along with schedules are attached with this document and the same are uploaded on our website for seeking comments/suggestions/views from all stakeholders for consideration of the Authority before the notification. The comments/suggestions should reach us by 10th April, in the format attached as Annexure-1, to the undersigned by e-mail at randip at irda dot gov dot in and also to my colleague Sh. D.S. Murthy at dsmurthy at irda dot gov dot in
(Randip Singh Jagpal)
Sr. Joint Director