The Insurance Regulatory and Development Authority of India (Irdai) has issued final guidelines on appointment of insurance agents.
It said insurers would be responsible for all acts and omissions by its agents, including violations of the code of conduct specified under these guidelines. In such cases, they would be liable to a penalty of up to Rs 1 crore (Rs 10 million).
The guidelines announced on Tuesday are effective April 1, and valid till regulations in this regard are issued.
According to the norms, no individual can act as an agent for more than one life insurer, one general insurer, one health insurer and one of each type of monoline insurers.
Irdai has said any person acting as an agent in contravention to the provisions of the insurance Act would be liable to a penalty of up to Rs 10,000.
Irdai will maintain a centralised list of the details of all agents appointed by insurers. Also, there will be a centralised list of blacklisted agents, whose appointment is cancelled or suspended for violation of the code of conduct and/or fraud.
The regulator said if an insurance agent represents more than one insurer offering the same line of products, he should dispassionately advice policyholders on the products of all the insurers he represents.
Now, Irdai has been empowered to appoint one or more of its officers as ‘investigating officers’ for inspection of the affairs of an insurance agent and to inspect his books, records and documents.
