IRDAI Chairman T.S. Vijayan said that distributors should be adequately compensated. He said this on the sideliners of 17th Annual Insurance Conference called ‘#FINCON2016’ organised by FICCI, held in Mumbai.
Vijayan said, “Distributors play a key role in the growth of the insurance industry. They are the means of communication between insurance companies and consumers.”
On the exposure draft in which IRDAI has proposed to hike upfront commission of agents, Vijayan said, “The whole idea behind the proposal is to reduce discrepancies in commission payouts across insurance companies and create a level playing field in the insurance distribution space. Not every insurer can pay higher commissions and hence we have suggested a cap.”
Vijayan told Cafemutual that the insurance regulator wants insurers to reduce their margin and compensate their distributors adequately. This commission has to come from insurer’s margin.
He further told Cafemutual that it takes a lot of effort to solicit insurance policies and give after sales services to clients. “Distributors are the face of insurance companies and hence they deserve adequate remuneration for their services; in fact, more than the CEO of an insurance company, he added.