Insurance Regulatory and Development Authority of India (IRDA) today said insurance companies can appoint individual agents on their own without license from the regulator from April 1.
IRDA chairman T S Vijayan said the regulator also plans to make health insurance, so far considered as part of non-life sector, a standalone entity.
“Currently, there are two lines of business — life insurance and non-life insurance. At present, health is not a standalone entity. It comes under non-life sector. We would like to frame a separate regulation for health insurance,” Vijayan told reporters.
“So far, the appointment of agents is done through licensing mechanism of IRDA. Now, the appointment of agents is given to the insurance companies. So, the whole licensing system will go.
“That means they (individual agents) will be appointed by the company. I expect the new system to begin from April 1.
These are the two changes that would be brought immediately,” he said.
He was talking to reporters on the sidelines of release of CII’s report titled ‘India Insurance Vision 2015: Building a USD 250 billion Customer Centric and Value Creating Industry’
Replying to a query, he said the insurance watchdog is also thinking of allowing foreign reinsurance companies to do business in India by opening a branch here without getting incorporated.
He said the hike in FDI limit in insurance sector would help attract investment which would result in higher penetration.
The Indian insurance sector would need around Rs 55,000 crore in next five years to double the current level of penetration that is pegged at 3 per cent, he added.
Meanwhile, the CII report recommended an inclusive, progressive growth for the industry over the next decade which will enable the life insurance industry to grow at 12 per cent CAGR over next decade to reach $160 to 175 billion, and non-life to grow at 22 per cent CAGR to reach a Gross Written Premium of USD 80 billion.