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IRDAI proposes to increase tie-ups limit between insurers, agents


With an aim to give policyholders wider access in purchasing covers, the Insurance Regulatory and Development Authority of India (IRDAI) on Wednesday proposed to increase the maximum limit of tie-ups between insurers and intermediaries (agents) as well as marketing firms.

In an exposure draft on insurance intermediaries, the insurance regulator proposed to increase the maximum limit of tie-ups with insurers for corporate agents from three to nine.

It also proposed to raise tie-up limit with insurers for insurance marketing firms from two for each category of insurance to six.

Stakeholders can give their suggestion on the exposure draft of IRDAI by August 24.

On regulatory sandbox scheme, IRDAI has suggested removing the limited validity period of four years in the regulations.

The regulator had notified the IRDAI (Regulatory Sandbox) Regulations, 2019 with a validity of two years to strike a balance between orderly development of insurance sector on one hand and protection of interests of policyholders on the other, while at the same time facilitating innovation.

Subsequently, it first extended the validity period of the regulations for two years up to July 25, 2023 and then again for a period of 6 months which is extendable by another 6 months.

The insurance regulator is now suggesting to increase the experimental period from the existing six months to up to 36 months.

Regulatory sandbox (RS) usually refers to live testing of new products or services in a controlled/test regulatory environment for which regulators may (or may not) permit certain relaxations for the limited purpose of the testing.

IRDAI has sought comments on the Exposure Draft Insurance Regulatory and Development Authority of India (Regulatory Sandbox) (Amendment) Regulations, 2022, by August 25.



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