Page 58 - Insurance Times May 2023

their expenses based on their growth aspirations 5. Commission payable to Insurance agent, Intermediary
and the ever-changing insurance needs with an or Insurance intermediary by insurers
objective to improve insurance penetration. (a) The total amount of commission payable under life
insurance products including health insurance prod-
3. Definitions:
ucts offered by life insurers shall not exceed the Ex-
(a) "Act" means the Insurance Act, 1938 (4 of 1938),
pense of Management (EOM) limits specified un-
as amended from time to time.
der Insurance Regulatory and Development Au-
(b) "Authority" means the Insurance Regulatory and
thority of India (Expenses of Management of Insur-
Development Authority of India established under
ers transacting Life insurance business) Regulations,
the provisions of Section 3 of the Insurance Regu-
2023 as amended from time to time.
latory and Development Authority Act, 1999 (41 of
(b) The total amount of commission payable under
1999).
general insurance products, including health insur-
(c) “Commission” means any compensation including
ance products offered by general insurers and
remuneration, or reward, by whatever name
health insurance products offered by standalone
called, paid by an insurer to Insurance agent, In-
health insurers shall not exceed the EOM limits
termediary or Insurance intermediary, as appli-
specified under Insurance Regulatory and Develop-
cable, for soliciting or procuring or transacting in-
ment Authority of India (Expenses of Management
surance business.
of Insurers transacting General or Health Insurance
(d) Words and expressions used and not defined in business) Regulations, 2023 as amended from time
these Regulations but defined in the Act, as to time.
amended from time to time, the Insurance Regu-
6. Submission of Returns on payment of Commission by the
latory and Development Authority Act, 1999 or in
insurer
any of the rules or regulations made there under
(a) All insurers, within 45 days of the expiration of each
shall have the meaning respectively assigned to
financial year, shall submit to the Authority the
them in those Acts, rules or regulations.
Board approved returns on payment of commission
4. Board approved policy for payment of Commission by the insurer to the Insurance agent, Intermedi-
(a) Every insurer shall have a written policy for pay- ary or Insurance intermediary
ment of commission, which shall be approved by the
(b) The formats for such information and data may be
Board of the insurer.
specified by the Authority from time to time.
(b) The Board approved policy shall be reviewed peri-
(c) These returns shall be reviewed by the Audit Com-
odically.
mittee prior to being placed for approval of the
(c) The objectives of the policy for payment of com- Board of the insurer.
mission shall inter alia take into consideration the
7. Repeal and saving: (1) Insurance Regulatory and Devel-
following:
opment Authority of India (Payment of Commission or
(i) it is in the interest of the policyholders;
Remuneration or Reward to Insurance Agents and In-
(ii) it increases insurance penetration and density surance intermediaries) Regulations, 2016 shall be re-
in the country; pealed from the date these Regulations come into
force.
(iii) the nature and tenure of the insurance policy;
(2) Unless otherwise provided by these Regulations,
(iv) the interest of the Insurance agent, Interme-
anything done, or any action taken or purported to have
diary or Insurance intermediary;
been done or taken in respect of the Regulations men-
(v) enhances the performance of the Insurance
tioned in sub-regulation (1) shall be deemed to have
agent, Intermediary or Insurance intermediary;
been done or taken under the corresponding provisions
(vi) it is commensurate with its business strategy; of these Regulations.
(vii) brings cost efficiencies in the conduct of busi- 8. Power of the Authority to issue clarifications etc: To re-
ness and simplification of the administration of move any difficulties in application or interpretation of
insurance business; and any of the provisions of these Regulations, the Chair-
person of the Authority may issue clarifications, direc-
(viii) gives an indication on the relative degree of
tions, and guidelines.
importance placed on each of the above.
52 May 2023 The Insurance Times