Page 29 - Life Insurance Today February 2018

Circular

IRDAI Circular

Clarification on MISP Guidelines the insurance broker nor the MISP can create such a
panel of insurer for selling motor insurance policies.
Ref. No:IRDA/INT/CIR/MISP/5/01/2018 However, the insurance companies should enter into
Date:11-01-2018 service level agreements with insurance brokers/
MISPs based on transparent and objective criteria.
I. Creation of panel of insurers by insurance II. Role and responsibilities of MISP vis-à-vis Original
intermediary or MISP Equipment Manufacturers (OEM’s)
II. Role and responsibilities of MISP vis-à-vis Original It is reported that the Original Equipment
Equipment Manufacturers (OEM’s) Manufacturers (OEM’s) are exercising undue influence
both on the insurance intermediary and the
It may be recalled that the Authority issued:- automobiles dealer who have become MISP without
a) Guidelines on Motor Insurance Service Provider having corresponding accountability for their actions.
vide Circular No. IRDA/ INT/ GDL/ MISP/ 202/ 08/
2017 dt. 31st August 2017 In order to ensure that MISP guidelines work in the
interest of the customers, it is advised that no MISP or
b) Circular on MISP – IRDA/INT/CIR/MISP/246/11/
the insurance intermediary can enter into an
2017 dt.01st Nov 17
agreement with the OEM which has an influence or
bearing on the sale of motor insurance policies.
I. Creation of panel of insurers by MISP
The Authority is in receipt of representations, from
insurance companies that they are not included in the Motor Third Party Insurance Coverage
panel of Insurance brokers/ MISP’s as it is not Ref. No:IRDA/NL/CIR/MOTP/001/01/2018
compulsory for Insurance broker/ MISP to empanel all
insurance companies for selling motor insurance Date:01-01-2018
policies through MISP even if they are willing to enter Hon’ble Supreme Court Committee on Road Safety had
into Service Level Agreements (SLA).
directed the States/Union Territories to periodically carry
Hereto attention to guidelines 5 (f) of Guidelines on out checks to see whether the vehicle owners have Third
MISP issued on 31.08.17 and point no.4, of IRDA Party insurance cover and in case they are not covered by
circular dt.01.11.2017, stating that an insurance Third Party insurance, detain the vehicle till such time the
intermediary based on an objective and transparent valid Third Party insurance certificate is produced by the
criteria can enter into service level agreement with vehicle owner. Several States have reported back that
general insurers for selling motor insurance policies. insurers have a cumbersome process that involves
The Authority is of the view that with the commission inspection of the vehicle concerned and that vehicle owners
/ remuneration levels for the insurance intermediaries have complained that it is not an easy process to obtain
and MISP being stipulated, the creation of a panel of insurance.
insurers is restrictive, which can lead to undesirable
market practices. Therefore, to remove misgivings in With an objective to ensure ease of obtaining Motor TP
the minds of the stakeholders it is clarified that neither liability only policy, insurers are advised to follow the

Life Insurance Today February 2018 29

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