The insurance regulator, Irdai, has made important changes to rules governing sales, investments and commissions charged by insurance companies as part of the ongoing deregulation agenda, reported Economic Times.
The changes were passed at the board meeting of Insurance Regulatory and Development Authority earlier this week. They are likely to be implemented by the end of the quarter, two people familiar with the decisions said.
Among the decisions is allowing banks to sell insurance policies of up to nine insurance companies, the biggest distribution reform since the regulator allowed corporate agents like banks to sell policies from three insurance companies as part of the open architecture policy implemented since April 2016.
The Irdai minutes are likely to be finalised in the next few days and changes are likely to be implemented in September.
The regulator has also decided to allow insurance companies to tap fund raising options, like through the debt market, without prior approval from the Irdai.
All these moves are part of the new Irdai chairman’s reform agenda, which has focussed on lightening regulations, giving companies more decision-making powers and removing old laws.
“The decisions made in the board meeting are a part of the same agenda,” said one of the persons cited above.
The clear focus is to ensure easier regulations and remove unnecessary regulatory influence or red tape.
Some of these things needed to be changed because they are not suited for the current business environment, which is more dynamic.