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IRDA May Allow Banks To Partner Multiple Insurance Companies

As per the present regulation, banks cannot have agency tie-ups with more than one insurer

Insurance Regulatory and Development Authority (IRDA) of India is taking into account whether to allow banks to team up with multiple insurance firms to sell their insurance products – reported The Times of India.

As per the present regulation, banks cannot have agency tie-ups with more than one insurer.

R Kannan, member, actuary at IRDA, said: Initially, we will be a little cautious… it (tie-ups of banks with insurance companies) can be two or three. We will then revisit the experience and come back.”

As per the source, IRDA has been requested by various life and general insurance firms to relax this norm. The regulating body has formed a seven-member committee to study the subjects. It is presently going through the existing Banacassurance model.

Mr. Kannan added: “The regulator is definitely going to introduce an open architecture, the question is how many tie-ups the banks can have with insurance companies. It (banks’ tie-up with two-to-three insurance companies) should be operationally feasible, administratively possible and at the same time take care of policyholders’ interests,” quoted the newspaper.