DEAR VIEWERS,
In February this year, Insurance Regulatory and Development Authority (IRDA) had come up with stringent guidelines, disallowing relatives of any employee of an insurance company to work as an agent for the same insurer. Previous draft of IRDA defined the term ‘relative’ to include spouse, parents, sisters, daughters, brothers, sons, daughters-in-law and sons-in-law.
On Wednesday, IRDA released a new circular modifying the term ‘relative’ and narrowing it down to include only spouse, dependent children or dependent step children, whether residing with the employee of an insurance company or not. The clause however, is applicable only to those insurance agents who are licensed or whose agency is transferred to another insurer on or after July 1st 2011.
This new circular should come as a relief to several insurance agents, as the earlier classification implied less scope for distant relatives to work for an insurance company
Life insurance companies, non-life insurance companies and IRDA realize the importance of agents for the growth of the insurance industry as a whole. At a recent Insurance Summit 2011, organised by Associated Chambers of Commerce and Industry of India (ASSOCHAM), IRDA Chairman J Hari Narayan made this clear by stating, “We do need agents and we need to do something about the agency channel.”
“One of the things is to require renewal of agent licenses on certain level of persistency. We need to have a regulatory call on this as insurance industry depends on agent persistency. IRDA has made some changes, we have tied up with some institutions for books to help agents learn,” he said.
The IRDA Chairman also said, “We should have two levels of insurance agents; one is we have a regular agents, then we are looking at senior agents.” Senior agents will be those who are more experienced and have served in the role for a good number of years. This will help fulfill their aspirational goals and to help keep them motivated.
........ EDITOR
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