Insurance sub broking in India:
Various stakeholders have been requesting the Authority to consider sub broking system as prevalent in other jurisdictions. At present many insurers and brokers are mainly operating in and around big cities.
It is noticed that the benefit of the range of products sold by all the insurers is not reaching to the customers residing in semi-urban and rural areas. This is mainly because of the concentration of brokers in and around big cities. Therefore authority is of the view that in order to increase the penetration of insurance in semi urban and rural areas the presence of intermediary who represents the customer is very vital.
A decade is passed since issuance of IRDA (Insurance Brokers) Regulations, 2002 and today we have around 343 licenced brokers working in various parts of the country. The issue of sub broking is under consideration of the authority for quite some time. After considerable deliberations on the issue of sub broking it was decided to constitute a committee (which included three members from Non-Life Insurance, Two members from Life Insurance, one member from NIA, three members from IBAI and two members from authority) on sub broking to examine various issues relating to sub broking.
The committee on sub broking is constituted vide IRDA/BRK/MISC/ORD/ 12/2012 dated 17/12/2012. The committee was asked to submit its report on or before 31/1/2013.
The committee has submitted its report along with its recommendations in line with the terms of reference given to it.
The entire report on insurance sub broking is placed for the benefit of all the stakeholders and general public.
Comments if any on the above exposure draft may be forwarded to the following before 31st March, 2013
Suresh Mathur, Sr Joint Director or Satish Hegde, OSD, Insurance Regulatory and Development Authority, 03rd Floor, Parisrama Bhavanam, Basheerbagh, HYDERABAD – 500004