Page 9 - Insurance Times Octoberr 2022

IRDAI mulls introducing surance penetration in India increased Government mulls SFIO-
from 3.76 per cent in 2019-20 to 4.20
portability option like agency to investigate
per cent in 2020-21, registering a
IRDAI may soon come up with a new growth of 11.70 per cent. Insurance insurance frauds
norm with respect to changing an in- penetration measured as the percent-
The government is considering creat-
surance agent. In order to enhance cus- age of insurance premium to GDP wit-
ing a Serious Fraud Investigation Office
tomer experience, and make services nessed handsome growth during the
(SFIO)-like independent agency for the
better and more convenient for the year, mainly due to the outbreak of
insurance sector to probe cases of
policy buyers, the insurance regulator COVID-19.
fraud. For the purpose, work is in
is planning agent portability option.
The ministry is doing a comprehensive progress to bring a Bill to amend the
He said that the agent portability op-
review of the Insurance Act, 1938 and Insurance Act, 1938, officials said. The
tion will not be restricted to general Serious Fraud Investigation Office
also looking at making relevant changes
insurance only but shall be applicable
to help push growth of the sector, probes corporate fraud cases and
to life insurance policies with a tenure comes under the Ministry of Corporate
sources said, adding the process is at a
of up to 20 years. Affairs.
preliminary stage.
"If the policyholder is not satisfied with The proposed agency, which could be
One of the provisions being considered
the service of an agent, he/she can named Insurance Fraud Investigation
is lowering the minimum capital re-
change the agent and can select a new Agency, has been recommended by a
quirement of Rs 100 crore for setting
agent. In case of change in agent, the working group - constituted by the In-
up an insurance business, the sources
commission received on the premium surance Regulatory and Development
said.
will then be paid to the new agent," Authority of India (IRDAI) and insurance
Shah informed. With the ease of entry capital norms, councils - comprising both the regula-
sources said, there could be entry of
tor and the industry, the officials said.
companies focussed on micro insur-
Finance ministry mulls They said by setting up such an agency,
ance, agriculture insurance or insurance
changes in laws to boost firms with regional approach. India would help in controlling and pre-
venting fraud in the insurance sector.
insurance penetration in So for them, the solvency margin re-
Such organisations were operating in
India quirement would also be different but many countries, including the National
without compromising on policyholders'
The finance ministry is contemplating Insurance Crime Bureau in the US, the
interest, the sources said.
changes in insurance laws, including Canadian National Insurance Crime Ser-
reduction in minimum capital require- Entry of more players would not only vices and the Insurance Fraud Bureau
ment, with a view to increasing the in- push penetration but result in greater and the Insurance Fraud Enforcement
surance penetration in the country. In- job creation in the country. Department in the United Kingdom.

The Insurance Times, October 2022 9