Insurance Web Aggregator Compliances
In order to ensure compliance with Insurance Web Aggregator Regulations, insurance web aggregators must adhere to various activities specified by the regulatory authority. At Enterslice, we provide comprehensive assistance to help you manage all the necessary compliances.
Various Insurance Web Aggregator Compliances under IRDAI
Regulatory compliances must be strictly followed by entities across India in order to operate smoothly. The Insurance Regulatory and Development Authority of India (IRDAI) is the primary regulatory authority for insurance web aggregators. The Insurance Web Aggregators Regulations, 2017, issued by the IRDAI, outline the rules that all insurance web aggregators in India must adhere to. Insurance web aggregators are also governed by the Insurance Act 1938 and the IRDA Act 1999.
Who are Insurance Web Aggregators?
Insurance web aggregators are intermediaries who maintain websites to provide insurance prospects with a platform for price comparison and information about products from different insurers. They collect data on various insurance policies and upload it on a single online portal. This allows individuals seeking insurance to visit the portal, compare products, pricing, and other details, and make an informed choice.
Different Insurance Web Aggregator Compliances
Insurance web aggregators must comply with the following regulations:
Board Approved PolicyInsurance web aggregators are required to have a board approved policy governing their approach to soliciting insurance products. This policy should include details on multiple tie-ups, types of products sold, mechanism for grievance redressal, reporting requirements, and other relevant items. The policy must be reviewed by the Insurance Web Aggregator Board at least once every three years.
Professional Indemnity Insurance Cover
Insurance web aggregators must maintain a professional indemnity insurance cover throughout the validity period of their registration certificate. This is specified in Form K (Professional Indemnity Insurance) of Schedule III of the Insurance Web Aggregators Regulations, 2017. In some cases, the IRDAI may allow newly registered insurance web aggregators to produce this policy within 6 months from the date of registration.
Maintenance of Books of Accounts and Records
Insurance web aggregators must prepare the following for each accounting year:
- Balance sheet or statement of affairs
- Profit and loss account
- Statement of income and expense
- Statement of cash/fund flow
- Additional statements as required by the authority
They must submit a copy of the audited financial statements, along with the auditors' report and any remarks or observations, to the Insurance Regulatory Authority within 90 days from the end of the accounting year. Any deficiencies pointed out in the auditor's report must be rectified within 90 days and reported to the authority. All records and documents must be maintained at the insurance web aggregator's head office for inspection, and e-records must be retained for a minimum of 10 years.
Insurer-wise Electronic Records
Insurance web aggregators must maintain electronic records of the following and provide them when required by the authority:
- Leads generated and transmitted
- Leads converted into policies
- Complaints received and disposed
- Products displayed on the website for comparison
- Remuneration gained for displayed products and converted leads
- Remuneration gained from outsourcing activities
- Any other remuneration obtained from insurers
- Clients' KYC records
- Duly signed electronic copies of proposal forms
- Register of clients and policy details
- Register of complaints and actions taken
- Copies of correspondence with the authority
- Any other records as requested by the authority
Disclosure Related Compliance
Insurance Web Aggregators are required to comply with several disclosure-related requirements as outlined by the regulatory authority. These include: Furnishing Half-Yearly Returns to Authority
Insurance Web Aggregators must submit half-yearly returns to the regulatory authority, providing insurer-wise business placements separately for life insurance, general insurance, and health insurance. The returns must be submitted in the specified formats before the 31st of October and 30th of April each year.
The regulatory authority will examine the returns and may issue directions or advice to the Insurance Web Aggregator as deemed necessary. The Insurance Web Aggregator must comply with these directions/advice.
Disclosures to Authority
Insurance Web Aggregators must disclose the following information to the authority:
- Changes in information or particulars that impact the registration certificate granted to them.
- Names of clients whose insurance portfolios are managed or have been managed by the Insurance Web Aggregator.
- Legal proceedings initiated against the Insurance Web Aggregator by other regulatory/government bodies within a reasonable period. This disclosure must be made within 30 days of the commencement of such proceedings. Additionally, any actions or directions issued by other bodies should also be disclosed within the same time frame.
All the above disclosures need to be made to the authority as and when required, but in any event, not later than 30 days of a requisition.
Material Change in Composition and Prior Approval
Insurance Web Aggregators must promptly disclose any material change in their composition to the authority within 30 days of such change. Prior approval of the authority is required for the following changes:
- Change of Principal Officer
- Change in Director(s) or Designated Partner(s)
- Change in Company Name
- Change in Address of Registered Office/Corporate/Head Office
- Engagement of services from service providers or third-party vendors for core activities of the Insurance Web Aggregator, such as Lead Management Systems and Webhosting
- Change in the location of servers hosting the comparison website(s)
- Opening/closing of branch offices
- Updated authorized verifier list for soliciting insurance business via Telemarketing/Distance marketing modes
- Claims under professional indemnity policies
- Property acquisitions
Additional Disclosures
Insurance Web Aggregators are also required to disclose the following information within three days of the action:
In case there is any change in the information provided during the application process or while the application is being processed, the applicant must voluntarily disclose such changes to the authority.
Compliance Certification
At the end of each financial year, the Principal Officer of the Insurance Web Aggregator must submit a certificate to the authority declaring that the Insurance Web Aggregator has complied with all the provisions of the Insurance Web Aggregator Regulations.
Additional Compliance Requirements
In addition to the above, Insurance Web Aggregators must adhere to the following requirements:
Display of Insurer Product Information
Insurance Web Aggregators must display information about the products of insurers who have entered into agreements with them on their designated website.
Information Systems Compliance
Insurance Web Aggregators are obliged to ensure that their information systems, including hardware and software, such as aggregation websites/portals, Lead Management Systems, and Data Centers hosting these systems, comply with generally accepted information security standards and procedures in India.
Secure Data Transmission
Insurance Web Aggregators must ensure that leads and other data are transmitted to insurers and other parties through secure layer data encryption technologies, such as 128-bit encryption.
Annual Information System Audit
The Information Systems hosted in India, including aggregation websites/portals, Lead Management Systems, and Data Centers, should be audited by CERT-In empanelled Information Security Auditing organizations once every financial year. The Insurance Web Aggregator must submit a copy of the Audit Certificate/Report to the insurance authority and the insurers they have agreements with within 15 days of receipt.
Statutory Auditor Certificate
Annually, the Insurance Web Aggregator must obtain a certificate from a statutory auditor along with the annual report, confirming compliance with all the provisions and the framework of the IRDAI Insurance Web Aggregator Regulations 2017.
Conclusion
Compliance with disclosure and additional requirements is essential for Insurance Web Aggregators to operate in accordance with regulatory standards. By adhering to these regulations, Insurance Web Aggregators can maintain transparency and credibility in their operations.
When it comes to Insurance Web Aggregator Compliances under IRDAI, meeting regulatory requirements can often be a challenging and time-consuming task for insurance web aggregators. Compliance requirements range from submitting half-yearly returns, disclosing changes in information, complying with statutory audits, ensuring secure data transmission, and more. To make the process smoother and hassle-free, Estabizz provides end-to-end support for Insurance Web Aggregator Compliances.
How Estabizz Fintech can support in getting compliance done
Estabizz is a leading legal and compliance consulting firm that specializes in providing regulatory compliance solutions to businesses. With a team of experienced professionals, Estabizz offers a range of services that are tailored to meet the specific needs of insurance web aggregators. Here’s how Estabizz can help insurance web aggregators with their compliance requirements:
- Managing Compliance Requirements: Estabizz helps insurance web aggregators manage their compliance requirements by providing a comprehensive compliance strategy. Right from determining compliance requirements to devising a compliance plan, Estabizz takes care of everything.
- Annual Compliance Calendar: To ensure timely compliance, Estabizz prepares an annual compliance calendar for insurance web aggregators based on IRDAI regulatory requirements. This ensures that compliance is done well before the deadline.
- Half-Yearly Returns: Estabizz assists insurance web aggregators in preparing and submitting half-yearly returns to the IRDAI, ensuring compliance with compliance. This reduces the burden on the insurance web aggregator and helps them avoid non-compliance penalties.
- Statutory Audits: Estabizz helps insurance web aggregators comply with statutory audits by advising them on the audit process. Estabizz also connects insurance web aggregators with a network of industry experts who can help them with the audit process.
- Secure Data Transmission: Estabizz ensures that insurance web aggregators comply with information security standards by advising them on secure data transmission practices. With Estabizz's guidance, insurance web aggregators can ensure that their customer's data is secure and protected.
- Disclosure Requirements: Estabizz helps insurance web aggregators comply with disclosure requirements by advising them on the nature and method of disclosures. This ensures that disclosures are timely and accurate.
- Regulatory Monitoring: Estabizz monitors regulatory updates and changes in compliance requirements, keeping insurance web aggregators updated on the latest regulations. This ensures that compliance requirements are met even when regulations change.
Estabizz provides end-to-end support for Insurance Web Aggregator Compliances, managing compliance requirements, monitoring regulatory updates, and ensuring timely compliance. By partnering with Estabizz, insurance web aggregators can focus on growing their business, knowing that their compliance requirements are being taken care of.
FAQ
An Insurance Web Aggregator is an online platform that provides customers with information about various insurance products offered by different insurers.
IRDAI (Insurance Regulatory and Development Authority of India) is the regulatory authority governing the insurance sector in India.
Insurance Web Aggregator Compliances are the regulatory requirements that Web Aggregators must adhere to in order to operate legally and maintain transparency in their operations.
Insurance Web Aggregator Compliances are the regulatory requirements that Web Aggregators must adhere to in order to operate legally and maintain transparency in their operations.
Insurance Web Aggregators must submit half-yearly returns providing insurer-wise business placements in life, general, and health insurance. These returns must be submitted by October 31st and April 30th each year.
Insurance Web Aggregators must disclose changes in information affecting their registration certificate, names of clients whose insurance portfolios they manage, and legal proceedings initiated against them by other regulatory/government bodies.
Disclosures should be made as and when required, but no later than 30 days of a requisition.
Material changes include changes in the Principal Officer, Director(s), Company Name, Address, use of service providers, and the location of servers hosting the comparison website(s).
No, material changes in composition require prior approval from the authority.
Additional disclosures include opening/closing of branch offices, updated authorized verifier lists, claims under professional indemnity policies, and property acquisitions.
.
The Principal Officer must submit a compliance certificate to the authority at the end of each financial year, declaring compliance with all regulations.
Insurance Web Aggregators must display information about the products of insurers they have agreements with on their designated website.
They must use secure layer data encryption technologies, such as 128-bit encryption, for transmitting leads and other data to insurers and other parties.
Insurance Web Aggregators must ensure that their information systems, including hardware and software, comply with accepted information security standards and procedures.
Yes, they must have their information systems audited by CERT-In empanelled Information Security Auditing organizations once every financial year.
Insurance Web Aggregators must obtain a certificate from a statutory auditor, along with the annual report, confirming compliance with IRDAI regulations.
No, compliance with these requirements is mandatory for Insurance Web Aggregators to operate legally and ethically.
Non-compliance can lead to penalties, fines, suspension, or cancellation of registration.
They should maintain proper records, conduct regular audits, keep up with regulatory updates, and seek professional guidance if required.
Yes, compliance requirements may be updated from time to time, and Insurance Web Aggregators should stay updated with the latest regulations and comply accordingly.
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