IRDAI Approves Online Insurance Marketplace 'Bima Sugam' The marketplace is backed by the insurance regulator, the Life Insurance Council and General Insurance Council, and will allow individuals to buy policies directly from insurance companies of their choice.
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The Insurance Regulatory and Development Authority of India (IRDAI) has approved the setting up of the much awaited Bima Sugaman, an online platform for selling all kinds of insurance products. Backed by the regulator, the Life Insurance Council and General Insurance Council, the platform will allow individuals to compare and buy policies directly from insurance companies.
The regulator gave the approval at its 125th board meeting, and in a statement said, "This marketplace serves as a one stop solution for all insurance stakeholders, including customers, insurers, intermediaries, and agents, thereby, promoting transparency, efficiency, and collaboration across the entire insurance value chain."
According to draft regulations, the Bima Sugham would be not for profit company. "The company shall establish, facilitate, develop, operate and maintain the Marketplace for providing various services to the insurance stakeholders."
The shareholding of the company would be widely held amongst life, general and health insurers and no single entity would have a controlling stake. Shareholders shall contribute to capital as and when required. The IRDAI would nominate two members on the Board of Company, and the latter will constitute a Risk Management Committee to mitigate various risks.
The marketplace would result in reduced commissions as companies would be directly selling policies on the platform, though insurance intermediaries, too, would be on board.
The individuals will no longer have to visit multiple insurers' websites or aggregator portals, and can simply log on to this regulator-approved platform to buy policies online, especially those concerned about sharing their mobile numbers with aggregator portals to obtain policy premium quotes. Moreover, the regulator has proposed that an insurer can offer a discount on premium rates for policies purchased directly through the platform.
Besides the online markeplace, the IRDAI also plans to mandate demat policies and e-insurance accounts (eIA) to create a framework and give a further push to end-to-end digitisation of the insurance ecosystem.
