Insurance Companies Can Appoint Agents without IRDA License

The Insurance Regulatory and Development Authority of India (IRDA) announced that insurance companies will be allowed to appoint agents without IRDA license from the regulator, beginning on April 1. This change in policy means that the licensing system will be eliminated, and the appointment of agents will be given directly to the insurance companies, instead of being done through the IRDA’s licensing mechanism.

Health Insurance: A Standalone Sector

In addition to this change, the IRDA’s chairman, T.S. Vijayan, stated that the regulator also plans to create a separate regulation for health insurance. Currently, health insurance is part of the non-life insurance sector, but the IRDA wants to frame it as a standalone entity.

Foreign Reinsurance Providers May Soon Do Business in India

Vijayan also revealed that the insurance watchdog is considering allowing foreign reinsurance companies to operate in India by opening a branch in the country, without the need to become incorporated.
He added that the increase in the foreign direct investment (FDI) limit in the insurance sector would aid in attracting investment, which should lead to greater penetration of the insurance market. Vijayan estimated that the Indian insurance industry would require approximately INR 55,000 crore in the next five years to double the current level of penetration that is currently at 3%.
Vijayan made these announcements during the release of the Confederation of Indian Industry’s (CII) report titled “India Insurance Vision 2015: Building a USD 250 billion Customer-Centric and Value-Creating Industry.”
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