India: IRDAI requires insurance intermediaries to have professional indemnity cover
Source: Asia Insurance Review | Jul 2021
Insurance intermediaries engaged in the distribution of insurance products and solicitation will have to take out professional indemnity (PI) cover, under new rules issued by the IRDAI set to take effect from 1 July.
To this end, the regulator released guidelines on a standard PI policy for insurance intermediaries, which include brokers, corporate agents, insurance marketing firms and web aggregators.
The IRDAI says that the standard policy shall have the mandatory covers specified in the guidelines and shall be uniform across the market.
The premium rates and other terms and conditions of such insurance policies will be determined by the insurance company depending upon various risk factors and its board’s approved underwriting policy. Every general insurer should endeavour to offer the standard professional indemnity, say the guidelines. A