Irdai Urges Insurers to Diversify Distribution Channels

Mumbai, Dec 12 (PTI) Insurance industry watchdog Irdai wants insurers to diversify their distribution channels, and not depend on a single entity like parent bank for selling policies, an official said on Thursday.

In some cases, parent banks of insurers are selling over three-fourths of the policy, the official, who did not wish to be identified, told reporters here.

The official said the regulator cannot ask the entities to drastically reduce the reliance on parent entities or bancassurance model overnight to very low levels as it can have a destabilizing effect.

"Overall digital growth, orderly growth and removal of concentration in areas is necessary," the official said.

The official explained the reliance on the bancassurance model makes lives easy for the companies and may be complacent as well.

However, the regulator has a better understanding of how the entire industry is working and how it is aligned to the broader policy priorities, the official said.

When asked about allegations of forced selling or mis-selling of policies, the official said that when clear concerns are being communicated by top officials including the Finance Minister Nirmala Sitharaman, it is upon the industry to internalize the message.