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In its 76th meeting, the authority said that they have certain further significant changes to bancassurance regulations. "It is decided to have further consultations with insurance advisory committee on new elements proposed to be included before approving regulations," said Irda in a press note.
Bancassurance wherein banks can sell policies of insurers with whom they have tied up, acts as an alternate distribution channel for insurers. While the recent bancassurance draft by irda says that banks could also act as brokers for insurance companies, others like the Reserve Bank of India have expressed concerns about this. RBI had said that this could lead to reputational risks for banks.
Under current rules, banks cannot tie up with more than one life and non life insurer each to sell their policies. Insurers have demanded an open architecture for bancassurance.
