Insurance Regulatory and Development Authority of India has issued the Guidelines on lnsurance e-commerce to promote e-commerce in insurance space
The Insurance Regulatory and Development Authority of India on 9th March 2017(“IRDA”) has issued the Guidelines on lnsurance e-commerce (“e-commerce Guidelines”) under Section 34 of the lnsurance Act, 1938 and Section 14 of the IRDA Act, 1999.
IRDA as a part of its developmental mandate has issued the e-commerce Guidelines to promote e-commerce in insurance space, aiming to lower the cost of transacting insurance business, bringing higher efficiencies and greater reach by providing lnsurance Self-Networks as a regular internet web-site (desktop or mobile version) or, mobile app or, both.
Please find below the highlights of the e-commerce Guidelines:
- An Applicant including a registered insurer or an insurance intermediary or any other person recognized by the IRDA intending to establish an lnsurance Self-Network (“ISNP”) needs to make an application in Form – ISNP – 1.
- Market Participants on lnsurance Self-Network Platform includes Insurers registered by the Authority, lnsurance lntermediaries, lnsurance Agents appointed by insurers registered by the IRDA.
- Existing – lnsurers and lnsurance lntermediaries, who have already set-up their own ISNP’s or insurance portals for selling and servicing insurance products are allowed to operate the platforms / portals, provided they comply with the requirements of e-commerce Guidelines within a period of three months and obtain necessary permission from the IRDA.
- The Chief Executive Officer and the compliance officer of applicant’s ISNP is required to file with the IRDA, annually a compliance certificate certifying that the information displayed on the webs-site, the processes, procedures and any other mechanism by whatever name called, displayed and implemented on the platform are in compliance to the e-commerce Guidelines at all times.
- Every applicant’s ISNP is required to provide details of procedures, processes and timelines for pre-sales solicitation of insurance policies for certain activities.
- The Applicant’s ISNP is responsible to comply with the KYC/ AML guidelines issued by the IRDA.
- The Applicant’s ISNP is mandated to have a pro-active fraud detection policy for the insurance e-commerce activities which is approved by its Board of Directors.
- Every Applicant is required to follow a standard operating procedure for its lT and non-lT processes and is required to keep the same ready for inspection by the IRDA at all times, failing which can invite penal action on part of the IRDA.