IRDAI issues Exposure Draft on IRDAI (Registration of Insurance Marketing Firm) Regulations, 2018

Dec 03, 2018 | by Avantis RegTech Legal Research Team


The Insurance Regulatory and Development Authority of India (IRDAI) on December 03, 2018 has issued an Exposure Draft on IRDAI (Registration of Insurance Marketing Firm) Regulations, 2018.

The IRDAI (Registration of Insurance Marketing Firm) Regulations, 2015 was notified in January, 2015 and the IRDAI (Registration of Insurance Marketing Firm) (First Amendment) Regulations, 2016 was notified in January, 2017. The channel has been in operation for three years. Operational feedback was obtained from various stakeholders, viz. Insurance Marketing Firms, insurance companies and the Insurance Councils through workshops conducted in May, 2018.

Subsequently, the IRDAI had constituted a “Committee for Review of IMF Regulations” for reviewing the said Regulations. Based on the recommendations of the Committee, a review of the existing framework governing Insurance Marketing Firms has been undertaken.

The following are some of the key changes proposed to the current Regulations:

a.       Reduction of net worth requirement to rupees five lakhs for applicants opting for an aspirational district, designated as such by the Government of India viz. NITI Aayog.

b.      Expansion of area of operation of an Insurance Marketing Firm to a maximum of three districts within a state.

c.       Expansion of the scope of work of Principal Officer, to include solicitation and procurement of insurance business.

d.      Expansion of the basket of products which can be solicited or procured by an Insurance Marketing Firm to include group insurance products for Micro Small and Medium Enterprises (MSMEs); crop insurance for non-loanee farmers and combi products.

e.      Increase in the threshold of change in shareholding beyond which approval of the Authority is required from 10% to 25%.

f.        Simplification of process of resignation of Insurance Sales Person.

g.       Reduction in work experience requirement of Principal Officer, and inclusion of various professional qualifications in the eligibility criteria for Principal Officer.

h.      Relaxation of training and examination requirement for Principal Officer, if the person has undergone training and examination required for Principal Officer of an insurance broker.

i.         Criteria of ‘domicile’ for Insurance Sales Person changed to ‘resident’.

All the stakeholders are requested to offer their comments, suggestions on the proposed draft regulations for further examination at the end of IRDAI. The comments, suggestions may be sent to [email protected] latest by December 15, 2018 in the format enclosed as Annexure II (MS-WORD) in the exposure draft.

URL: https://www.irdai.gov.in/ADMINCMS/cms/frmGeneral_Layout.aspx?page=PageNo3674


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