Page 11 - The Insurance Times August 2024

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diciously, safeguarding the interests of
Insurance sector has moved from rule-based frame-
policyholders, the regulator said.
work to principle-based approach: Irdai chairman Places of business should be opened
The insurance sector is transitioning from a traditional rule-based regula- within a year from the date of ap-
tory framework to a principle-based approach, which facilitates ease of doing proval, after which it would lapse.
business, fosters growth opportunities, promotes healthy competition, and
To open a representative or liaison of-
encourages innovation, Debasish Panda, chairman, Insurance Regulatory fice outside India, the board of the in-
and Development Authority of India (Irdai), said.
surer should approve all the related
Delivering a special address, 'Insurance for All by 2047', at the third edition operational matters.
of the FE Modern BFSI Summit, Panda said the rule-based regulatory frame- "The insurer should have appropriate
work was insufficiently equipped to harness the full potential of the insur- arrangements to ensure that the poli-
ance sector and was, in fact, constraining its growth.
cyholders' liabilities that arise out of
Panda said that after extensive consultations and engagements with all foreign operations are adequately ring-
stakeholders, Irdai introduced several rationalisation measures in recent fenced in order to protect interests of
years. "At one point, we had 78 regulations accompanied by their respec- the policyholders residing in India," it
tive compliance requirements. Even remembering the names of all these said.
regulations was a tedious task," he noted.
As per IRDAI data, there were 11,256
He added that the first task for Irdai was to streamline the regulatory frame- life insurance offices as on March 31,
work by eliminating redundant requirements and transitioning to a principle- 2023, which is an increase of 196 from
based regulatory architecture. "As a result, 78 regulations have been con- the previous year. Around 59 per cent
densed to 20. Of these, only 15 pertain to the conduct of insurance opera- of life insurance offices are in tier1 cen-
tions, while the remaining are internal to the regulatory setup." tres with population of one lakh and
above.
IRDAI asks insurance firms remote locations of the country. Adop- About 0.76 per cent are in tier-6 cen-
tion of technology infrastructure to tres with population less than 5,000.
to open more physical reach out to customers enhances ease, The public sector life insurer had offices
branches a physical approach which can come in in 688 of the 750 districts (92 per cent)
IRDAI has asked insurers to open more handy to reach the last mile," the regu- in the country, whereas private sector
bricks-and-mortar branches alongside lator said in a master circular on op- insurers had offices in 604 districts (81
stepping up digital offerings. erations. per cent).

"Physical presence through brick-and- To instil confidence in customers Public and private insurers together
mortar offices leads a long way in gain- through visibility, the opening or clos- covered 92 per cent of districts.
ing customer confidence particularly in ing of business units must be done ju- General and health insurers were op-

The Insurance Times August 2024 11