INSP (Insurance Self-Network Platform) Registration

INSP (Insurance Self-Network Platform)

Overview

INSP (Insurance Self-Network Platform) registration is a mandatory requirement for insurance aggregators and web aggregators operating in India as per IRDAI (Insurance Regulatory and Development Authority of India) guidelines. The registration ensures regulatory compliance and provides a secure and transparent platform for insurance-related transactions.

Definition is INSP

INSP or Insurance Self-Network Platform is an electronic platform that allows insurance buyers to buy policies online and provides an interface for aggregators, insurance companies, and other stakeholders. It also enables online verification of the policies and ensures transparency in the insurance market.

Who Needs INSP (IRDA) Registration

Any insurance web aggregator or insurance aggregator who facilitates the selling of insurance policies online is required to get INSP (IRDA) registration. The registration process is stringent and comprehensive, ensuring that only the eligible entities are granted access to the platform.

Objectives served by the ISNP

Insurance Self-Network Platform (ISNP) aim at widening the footprint of insurance products and making them a necessity for most people. Keeping this goal in mind, IRDA has rolled out various directions to augment the scope of e-commerce in the insurance space. The platform provides for low-cost transactions of insurance products and improved market presence.

INSP Registration Process

Let's understand the step-by-step process of INSP (IRDA) registration:

Following is the procedure that's to be implemented to start an ISNP:

Prepare and compile the above-mentioned documents.
File the online application for ISNP registration.
Upload and submit the requisite documents in the proper format.
Pay the ISNP license registration processing fee of ten thousand rupees.
Submit the application to the authorities for assessment.
The Authority will then assess the application along with the source code of the e- commerce portal.
The applicant can be asked to correct some information or provide them during the assessment. The Authority can also issue summons to the applicant if discrepancy(s) arise during the application assessment.
Applicant can check their application status regularly on the website.
Upon successful verification, the Authority will issue the ISNP license to the applicant within 60 days of application filing.

ISNP registration Documents Checklist

To start an e-commerce website dedicated to selling insurance policies, you must attach the following documents to the ISNP registration application form:

Certificate of Incorporation of the applicant
Memorandum of Association of the applicant
Articles of Association of the applicant
Details of the directors and shareholders of the applicant business entity
A document containing the description of the business of the applicant
Details of the management personnel
Details of steps taken to prevent unauthorized access
Details of procedure implemented for disaster recovery
Details of the encryption implemented to safeguard customer information
Details of the Information Security management system
Source code of the e-commerce portal
CERT-in certification of the E-commerce portal

Let’s Understand more in detail about Insurance Self Network Platform (ISNP)

An Insurance Self Network Platform (ISNP) is an electronic platform established with the approval of the Insurance Regulatory and Development Authority of India (IRDAI) that facilitates insurance e-commerce activities. It serves as a digital platform where insurance companies can manage their network of healthcare providers, policies, claims, and settlements.

The ISNP enables insurers to offer insurance products and services through various channels such as websites (desktop or mobile versions) or mobile applications. It plays a crucial role in conducting insurance e-commerce activities, providing a secure and transparent platform for insurance-related transactions.

Entities that meet the eligibility criteria and obtain permission from the IRDAI can set up an ISNP. The registration and licensing of ISNPs are governed by the guidelines and regulations outlined by the IRDAI.

By utilizing an ISNP, insurance companies can lower the cost of transacting insurance business while increasing operational efficiencies and expanding their reach. This platform empowers insurers to streamline their operations, enhance customer experiences, and promote digitalization in the insurance industry.

Who can setup ISNP and What is the eligibility criteria to setup ISNP

ISNP can be set up by any insurer or insurance intermediary like Brokers, Corporate agents and web aggregators.

Insurer or Insurance Intermediary: The entity seeking to set up an ISNP should be an insurer or an insurance intermediary such as a broker, corporate agent, or web aggregator.

Web/Mobile Platform: The entity should possess a web or mobile platform that enables the sale and servicing of insurance policies online. This platform serves as the interface through which insurance products are offered to customers.

There is no specific examination requirement or permission application to set up an ISNP.

Do we need to pass any exam or apply for permission to set up the platform or AI Platform

There is no exam. You need to have a Web/ Mobile platform to sell and service insurance policies across life and non-life insurance companies.

The requirements to set up an AI platform may vary depending on the specific context and purpose of the platform. Generally, there is no specific exam or permission that needs to be passed to set up an AI platform. However, designing and building a successful AI infrastructure and platform requires a thorough understanding of AI technologies, infrastructure requirements, and best practices.

Here are some key considerations and requirements for setting up an AI platform:

Understanding AI: It is essential to have a solid understanding of how AI works, its capabilities, and limitations. This knowledge helps in selecting the right AI project and ensuring its success.

Infrastructure: Building an AI platform requires a robust infrastructure capable of handling the computational demands of AI algorithms and models. This includes considerations such as storage requirements for training and inference data, GPU/CPU clusters, and integration with continuous integration and deployment (CI/CD) pipelines.

Data Management: AI platforms typically require large amounts of data for training and analysis. Establishing effective data management practices, including data storage, processing, and cleaning methodologies, is crucial for successful AI implementation.

Technical Expertise: Building an AI platform may involve collaboration between data scientists, platform engineers, and infrastructure engineers. Each role brings specific expertise in selecting AI models, implementing API changes, managing data, and ensuring resource requirements are met

What is the process for setting up ISNP?

Step 1: You can register on the portal(isnpdotirdadotgovdotin) with your existing license, Once registered will receive a mail confirmation with the URL, login credentials and pre-requisites for joining the platform

Step 2: You can login to the portal and submit the form online. Upon successful submission of the form, you will receive a printable PDF on your registered email. You can submit the proposal along with a non-refundable fee of ₹ 10,000/

Step 3: You will be given 60 days to setup the platform and get certified by the registered certification bodies.

What services can be offered on ISNP?

Insurance Self Network Platform) is primarily associated with the insurance and healthcare industry, specifically related to the regulation of e-commerce in the insurance space and the establishment of the Insurance Self Regulatory Network (ISRN). The ISNP is designed to allow insurers to leverage digital platforms to connect with healthcare providers and manage policies, claims, and settlements from a single access point

ISNP can offer the following services to policy holders

issuance and crediting of the Policy Document / Certificates of insurance/
Proposal Form/ Medical reports, etc. Organizing medical check-up and submission of medical reports
issuance of endorsement
Change of Policy Terms and Conditions / Details Change
Collection of renewal premiums and remittance to insurers
Change of Name/ address
Registration of Assignment
Nomination/ Change of Nomination
Surrender, Maturity, Withdrawals, Free look Cancellations, Return Benefit
Pay-outs
Loan Against Policy
Fund Switching/ Premium Redirection
Declarations Update
Extension of Cover
Revival / Cancellation of Policy
Transfer of Policy
Duplicate Policy
Death / Maturity Claims
Other Service operations as may be specific for the products

Pre-conditions for ISNP setup

To become an Insurance Self-Network Platform (ISNP), a business entity must meet the following conditions before applying for ISNP registration with the IRDAI:

The applicant must be an Incorporated Company or a registered Limited Liability Partnership.
The applicant must appoint a principal officer to oversee its ISNP business.
The applicant must comply with all guidelines stated in form ISNP-1.
The applicant must demonstrate the portal's ability to automate processes and maintain data privacy.
The applicant must not engage in insurance e-commerce activities without formal registration and approval from the Authority.
The applicant must pay a non-refundable ISNP license processing fee of ten thousand rupees plus applicable taxes.
Existing ISNPs that have already established insurance portals must continue operating those portals, comply with guidelines within three months, and obtain permission from the Authority.
The applicant must complete the ISNP registration application within 15 days; otherwise, it will become canceled.
The Authority must decide on the application within 60 days of receiving all documents.

What is EIA?

EIA stands for e-Insurance Account or “Electronic Insurance Account“ which will safeguard the insurance policy documents of policyholders in electronic format. This e-Insurance account will facilitate the policyholder by providing access to the insurance portfolio at a click of a button through internet. IRDA has granted the Certificate of Registration to the following four entities to act as “Insurance repositories“ that are authorized to open e- Insurance Accounts.

M/s NSDL Database Management Limited
M/s Central Insurance Repository Limited
M/s Karvy Insurance Repository Limited
M/s CAMS Repository Services Limited

EIA, or Electronic Insurance Account, is an online platform that allows insurance policyholders to store and manage all their insurance policies in a single electronic account. It is similar to a demat account used in the financial industry for holding and managing securities electronically.

Benefits of EIA include:

Convenience: With an eIA, policyholders can access and manage all their insurance policies in one place, eliminating the need for managing physical policy documents.

Centralized Access: It provides a centralized repository for policy documents, making it easy to view and retrieve policies whenever needed.

Policy Updates: Policyholders can receive updates and important notifications related to their policies through the eIA platform.

Portability: If policyholders wish to switch insurance providers, they can easily transfer their existing policies to the new provider without the need for physical documents.

Each e-Insurance Account will have a unique Account number and each account holder will be granted a unique Login ID and Password to access the electronic policies online.

It mandatory to have EIA customers before transacting on ISNP. You need to facilitate opening of eIA of the customer within 15 days of issuing the policy at the willingness of the customer.

What is the difference between Web Aggregator and ISNP?

An ISNP and an insurance web aggregator provide for the online selling of insurance products via an interface.
The fundamental difference between the two is that the former is capable of onboarding various web aggregators. Meanwhile, the latter has limited scalability.
The ISP can approach various aggregators to pool different insurance policies. It acts as an integrated platform that leverages the comparison modules of each aggregator and other insurers.

Who can serve the role of ISNP in India?

The applicant firm must have legal status. It must be registered either with MCA or ROFs. Apart from that, the applicant firm should comply with the following conditions:

The availability of a qualified principal officer is a must.
Also, staff should entail a qualified Financial Service Executive and an Insurance Sales Person.
The net worth should not be less than Rs 5 lakhs for a single branch. For multiple branches, the limit is not less than Rs 10 lakhs.
The name of the firm must have the term IMF.

ISNP Compliances as per Regulatory IRDA Requirements

Every ISNP registration applicant must timely file their annual ISNP compliance as per the ISNP Guidelines. We have detailed some of these ISNP compliance in the following

As a registered Insurance Self-Network Platform (ISNP), it is crucial to maintain the integrity of automatic data processing systems and uphold privacy regulations for both insurance companies and consumers. It is equally essential to have internal mechanisms in place to assess and monitor controls, procedures, and safeguards.

Once a year, an external Certified Information System Auditor (CISA) or a Chartered Accountant with DISA (lCAl) qualification, or a CERT-IN expert must carry out a review of the registered ISNP's systems, controls, procedures, and safeguards at the ISNP's cost. The scope of this audit must follow the guidelines set by the Insurance Regulatory and Development Authority of India (IRDAI).

The registered ISNP must adhere to the Information Security Management System Standards outlined by the International Organization for Standardization (ISO) or the International Electro-technical Commission (IETC), or their equivalent, and should review their systems annually.

The ISNP must submit a report of the external audit and information security management system to the Board or a sub-committee for their observations. If any adverse findings are material to the operations of the ISNP or cause financial loss to policyholders, the ISNP must report them to the IRDAI with an action plan.

The IRDAI has the right to undertake an inspection of the registered ISNP's affairs by external agencies themselves or through an external agency at any time, notifying the ISNP beforehand and specifying the needed documents for the inspection.

The certification for an ISNP is valid until the certificate of incorporation is valid, and in the case of insurance intermediaries such as an Insurance Broker or a Corporate Agent, the permit is valid until their license gets revoked or cancelled.

ISNP compliance for certificate holders must follow this Please read carefully.

Recordkeeping of ISNP Personnel Performance:

Each ISNP must maintain records of the conduct and performance of its management personnel to ensure satisfactory performance.

Data Security Mechanisms:

ISNPs must protect their records and data from unauthorized access, alteration, destruction, disclosure, and dissemination.

The network used for information transfer among market participants must be secured against unauthorized entry or access.

Data Transmission and Encryption:

ISNPs must have standard transmission and encryption formats among market participants to protect information from disruption and hacking.

Disaster Management Procedure:

ISNPs must establish procedures and facilities to protect against loss or destruction caused by natural disasters.

Arrangements for disaster recovery must be made at an alternative location.

Data Protection of ISNP Clients:

ISNPs must have mechanisms to ensure the interests and privacy of individuals purchasing insurance policies on their platform.

Insurance Solicitation and Post-Sale Services:

ISNPs must have procedures, processes, and timelines in place for pre-sales solicitation and post-sales servicing of insurance policies.

Management Information System (MIS):

ISNPs must have an MIS that supports their internet-based insurance operations, connecting with insurance core systems in real-time.

Effective isolation must be maintained between other application systems of insurers to prevent the spread of information security risks.

Cyber Security Facilities:

ISNPs must have robust firewalls, intrusion detection systems, data encryption, disaster recovery mechanisms, and other information security management systems.

Registered Domain Name:

ISNPs must have a registered domain name for their website and hosting servers in India.
They should also have specialized professionals for internet insurance business administration.

Information Availability:

ISNPs must ensure that information displayed on their website, including processes and procedures, is available for verification and scrutiny at all times.

Data Processing Systems:

ISNPs must maintain the integrity and privacy of their data processing systems for insurers and consumers.
Internal mechanisms should be in place to review, monitor, and evaluate system controls, automation systems, management procedures, and safeguards in the event of a crash.

Auditing:

The IRDAI has the right to conduct independent inspections of ISNPs at any time, with prior notice.
The ISNP must furnish requested documents during the inspection.

For more information on ISNP compliance, you can consult the insurance experts at Estabizz Fintech

ISNP Operations Review:

As part of regulatory compliance, a newly incorporated ISNP must undergo an annual review by third-party organizations, including External Certified Information System Auditors, Chartered Accountants with DISA qualifications, or CERT-IN Experts. The review should evaluate Controls, Systems, Procedures, and Safeguards, and the authorized Authority will prescribe the scope of external audits for the ISNP platform.

ISNP Information Security Management System's Standards:

ISNP must adhere to IRDAI standards for setting up an information security management system, such as those set by the International Organization for Standardization, the International Electro-Technical Commission, or equivalent organizations. It should be reviewed annually to ensure security system efficiency and sustainability.

Reports to the Company's Board:

The ISNP must submit the CISA Auditor Report, DISA-qualified Expert Report, CERT-IN Expert Report, and Information Security Management System Performance Evaluation Report to the company's Board or its sub-committee for observations. Any material findings that result in financial loss to the insured must be reported to the ISNP operations along with an action plan.

ISNP Auditing Procedure:

The IRDAI reserves the power to conduct an external audit of a licensed ISNP or inspect its affairs at any time, after giving prior notice. The Authority will specify the required documents to be furnished by the ISNP for the inspection procedure.

ISNP License Renewal:

An ISNP certification is valid for three years, and after the period, its certificate of Incorporation expires. For intermediaries such as Insurance Brokers or Corporate Agents, the ISNP permit remains valid until it gets revoked. Therefore, the ISNP platform must apply promptly for ISNP license renewal with the IRDAI when the certification period ends.

RBI Guidelines for E-Commerce ISNPs

Insurance Self-Network Platforms (ISNPs) are becoming popular in the e-commerce industry as a way for insurance companies to promote their products online. The Reserve Bank of India has issued guidelines for insurance companies interested in using an e-commerce platform. These guidelines are aimed at improving the online purchasing experience for insurance customers and increasing business opportunities.

To set up an ISNP for insurance e-commerce activities in India, applicants must adhere to the following guidelines:

Online Offering
The ISNP can be a website, mobile app, or both.
Only registered market participants can be part of the ISNP.
Internet Website and Mobile App
The website must display the applicant's legal name, address, contact information, and registration details.
Relevant information, such as how to file a complaint, must be provided.
Disclosures
Only approved product features should be displayed on the ISNP.
Misleading information is not allowed.
The ISNP should display products only from registered insurers, except for combi-products.
Registered insurance intermediaries may display products from insurers but should remain unbiased.
Information Sharing with Prospects
Clear and simple language should be used to provide information about the product's target customer, characteristics, coverage, exclusions, limitations, premiums, cancellation procedure, validity, and more.
Pricing
Insurers set the pricing of their products, which must comply with approved rates.
Discounts specified by the Authority should be applied on the ISNP.
The prices for different products offered on the ISNP must be the same.
Commission or Remuneration to the ISNP
The sale of products through the ISNP must comply with IRDA Regulations, 2016.
No fees, payments, or charges should be exchanged between market participants for using the ISNP.
Compliance with KYC/ AML Norms
The ISNP is responsible for complying with Know Your Customer (KYC) and Anti-Money Laundering (AML) guidelines issued by the Authority or other statutory authorities.
Compliance can be achieved through approved facilities such as e-KYC from UIDAI, e-PAN from NSDL, or valid KYC documents as per the Authority's circular.
Payment of Premiums
Premiums for online sales should be paid through credit/debit cards, net banking, e-wallets, or other electronic modes.
Payment through cheques or demand drafts can be facilitated.
Cash payments are only accepted if the insurer's system provides immediate acknowledgment to the policyholder.
Agreements between insurers and the ISNP for online sales or premium receipts must not disadvantage policyholders.

These guidelines ensure transparency, fairness, and customer protection in the insurance e- commerce sector.

Revocation of ISNP License

A registered ISNP is authorized to carry out its designated duties in the market as long as its certificate of registration remains valid.

For insurers, the certificate remains valid unless revoked by the Authority.

The Authority has the discretion to revoke the ISNP license if it determines that the ISNP's activities:

Are not in the best interest of policyholders.
Are not conducive to the orderly growth of the industry.
Violate the code of conduct issued by the Authority.
Fail to meet the requirements specified in the IRDA guidelines.
Contravene the provisions stated in the Insurance Act of 1938, IRDA Act of 1999, and other relevant regulations, guidelines, circulars, orders, or notices issued by the Authority.
In any case, the ISNP must be given an opportunity to be heard by the Authority.

How Estabizz Fintech can assist with ISNP setup permission in India

Obtaining ISNP registration involves more than just filing an application. The process has various complexities and nuances that can delay registration. That's why it's beneficial to work with consultants who can expedite the process. Estabizz Fintech is one such consultancy that offers the following services:

Document drafting
Application filing
Departmental follow-up
For Compliance & Auditing

If you're eager to launch your own insurance e-commerce portal and require a prompt registration, reach out to Estabizz Fintech.

FAQ

Is there any fee for setting up ISNP?

Yes, you need to pay a non-refundable fee of rupees ten thousand plus applicable taxes.

How long does it take to get the approvals?

Your application is pre-approved as per your declaration of your readiness. You will be given 60 days of time to get certified on the platform.

How long is the license valid?

License is normally valid as long as the certificate of registration is valid in case of insurance intermediaries. In case of insurers, the permission will be valid unless it is revoked.

How do we carry out AML/KYC checks?

You can integrate services of e-KYC facility offered by UIDAI and e-PAN facility offered by NSDL

I am an insurance tied agent. Can I set up ISNP?

No. You need to use the existing platform of the respective insurance company.

Will there be special/different products specially designed for ISNP?

No, all existing products can be sold on the platform. Insurers need not re-file the products if there is no change in the fundamental characteristics of the product.

Will customers get any discount?

Yes. Insurer may decide to offer discount as defined by the authority and as per F&U guidelines

Will there be separate fee for servicing the customers?

No, there is no separate fee envisaged under these guidelines.

Will the commission structure be different for products sold through the platform? Is there any special commission / incentive offered for selling products through ISNP?

A product sold through the applicant's ISNP shall be governed by IRDAI (Payment of commission, remuneration or reward to insurance agents and insurance intermediaries) Regulations, 2016.b No fees, charges or payments by whatever name called other than that allowed

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