The insurance regulator has proposed to relax rules for the registration of insurance marketing firms (IMFs) with an aim to improving insurance penetration in the country.
In June, the IRDAI had formed a committee to review regulations for IMFs which are registered by the regulator.
Based on recommendations made by the panel, the IRDAI has proposed several changes in the existing framework governing IMFs, reported Press Trust of India.
Among the changes, the IRDAI is considering reducing the net worth requirement to INR500,000 ($7,000) for those applying for an IMF licence. The current minimum capital requirement for registration as an IMF is INR1m.
IRDAI has also proposed expanding the basket of products which can be marketed by an IMF to include group insurance products for micro small and medium enterprises (MSMEs), crop insurance for non-loanee farmers and combi products.
IMFs were introduced by the IRDAI in 2015 to improve insurance penetration in the country through an area-specific approach. A total of 117 districts in 28 states are designated for IMFs to operate in.
IRDAI is seeking feedback from stakeholders on the proposed changes with submissions to be made by 15 December.