Tightening the reporting standards, IRDAI has asked insurance companies to keep record of all payments made to their agents separately. Such payments include commission, bonus, rewards etc.
So far, insurance companies were required to report details of policies sold and commission paid to agents and brokers in a prescribed format. Insurers had to submit details of first year commission, commission on single premium policies, renewal commission and additional payout within one month of the completion of every financial year i.e. before April 30. However, such a reporting format did not capture information on rewards, bonus and any other payment made to intermediaries.
In a circular, IRDAI said that insurance companies will have to maintain record of - particulars of business procured by each person, the amount of premium received on such business, amount of total commission paid, bonus commission paid, rewards paid in any form and other remuneration paid.
Currently, IRDAI norms allow life insurers to pay up to 20% of the first year commission as rewards to insurance intermediaries. Such incentives go up to 30% of the first year commission for insurance agents in general insurance.
Further, the insurance regulator has asked agents and other intermediaries to keep invoices and vouchers of all kind of payment received separately - commission, rewards, bonus and any other remuneration.