India’s Insurance regulator Irdai is planning to come out with guidelines on point-of-sales (PoS) person to sell life insurance policies. According to industry officials, the guidelines can facilitate the growth of insurance business in the country and enhance insurance penetration and density.
Last year in October, the Insurance Regulatory and Development Authority of India (Irdai) had come out with the guidelines on PoS person for non-life & health insurers.
PoS persons are allowed to sell simple insurance products in the non-life and health insurance space that don’t require a lot of underwriting. Accordingly, Irdai has issued guidelines on staff maning PoS who will be allowed to sell certain specified products that Irdai feels are simple and standard in nature.
Nilesh Sathe, member-life at Irdai said, “Recently Irdai had brought out point of sales guidelines for non-life insurance segment and it has received stupendous response from the industry. Very shortly life insurances guidelines will be finalised on point of sales.” Though no exact time frame was given, senior officials in the industry claim that the guidelines will be issued by the regulator in the next one month.
Senior officials feel that this process of appointing PoS for life insurance industry will simplify the distribution network so that simple products can reach maximum people. “It has helped general insurance industry to target more investors. But we have to wait for the exact guidelines for life insurance as there are few products which require lot of underwriting. We believe PoS would be able to sell simple products like term plan and few traditional plans,” said a senior officer from the life insurance industry.
After the positive response received by the non-life insurance segment, Irdai in March this year also expanded the range of products to include crop insurance and health insurance as they are largely pre-underwritten and are standard products. Irdai decided that point of sales person could sell crop insurance with a sum insured limit of Rs 1 lakh per acre for all kinds of crops and hospital cash policy where a fixed benefit in the form of cash for every day of hospitalization with a limit of Rs 1 lakh per individual.