Bancassurance Push
IRDAI may issue norms to limit insurers' dependence on parent banks - source
This story was originally published at 15:13 IST on 12 December 2024
Register to read our real-time news.Informist, Thursday, Dec. 12, 2024
By Kshipra Petkar
MUMBAI - The Insurance Regulatory and Development Authority of India may come out with regulations to limit the dependence of insurers on parent banks for bancassurance, an official aware of the matter said. This comes amid concerns about parent banks contributing to more than 90% of sales of their subsidiary insurers.
The official said that insurance companies would have to tie up with more banks and reduce dependency on the parent bank. The regulations in this regard would only come into effect after stakeholder consultations and the exposure draft is issued, the official said, adding that the regulator aims to encourage diversification across multiple channels to ensure balanced growth.
The official said that IRDAI was closely monitoring the concentration of business in specific distribution channels and that heavy reliance on a single channel was unsustainable.
On Nov. 28, Max Life Insurance Co. Ltd. and SBI Life Insurance Co. Ltd. had denied media reports alleging that IRDAI planned to cap the proportion of business insurance companies generate through bancassurance partnerships.
According to investor presentations by insurance companies, the share of banassurance in SBI Life Insurance's individual annualised premium equivalent stood at 58% in Apr-Sept. In the case of HDFC Life Insurance, the share of banassurance in individual annualised premium equivalent stood at 65%, and for Max Life Insurance, it was 52%. End
Edited by Avishek Dutta
For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.
Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.
Informist Media Tel +91 (22) 6985-4000
Send comments to feedback@informistmedia.com
© Informist Media Pvt. Ltd. 2024. All rights reserved.
To read more please subscribe
Share this Story:
