IRDA has recently issued the guidelines for web aggregators in which it has mandated them to provide unbiased content and information of insurance policies.
IRDA has recently come out with a gazette notification to roll out structure, duties, criteria and functions of web-aggregators. Web Aggregators compile and provide information about insurance policies of various companies on a website.
The insurance regulator has mandated web aggregators to provide unbiased content and information of insurance products based on their types like whole life insurance, term plan, health insurance, endowment, annuity etc.
Unlike earlier, these web aggregators cannot display any ratings, rankings, endorsements or bestseller insurance products on their website. Also, these websites cannot display any advertisements on their portals.
In addition, they will have to put in place a system for recording and monitoring complaints and ensure communication with customers through phone, email, messaging etc.
Some key features of web aggregators
Criteria: A minimum net worth of Rs 10 lakh is required to web aggregators. The applicants need to apply to IRDA which will grant license to carry out web aggregator as well as telemarketing business in India. This license will be issued for three years subject to renewal for a requisite time period. IRDA will charge an annual fee of Rs 5000 from web aggregators.
Structure: Web aggregators should have to appoint a principal officer who has undergone training for at least 50 hours and 25 hours of renewal training at the end of every three years. The employees of web aggregators involved in insurance solicitation and verification should have to complete the 50 hours of theoretical and practical training on insurance from any recognized institutes. Tele-callers should also need to undergo necessary training of 25 hours.
Duties: Apart from comparing products, these websites can share contact details of customers which they track through lead management system (LMS) in order to generate prospects for insurance companies. However, they will have to prominently display a disclaimer of this in their websites. These portals can share the lead with three insurers in the same class of business.
Web aggregators can sell insurance policies through telemarketing. They are expected to work as an insurance broker who typically represents interest of customers not insurance companies. However, they cannot solicit non-single premium or single premium type of policies for an annual premium exceeding Rs 50,000 through telemarketing. Also, they cannot solicit ULIPs through this mode.
Remuneration: Web aggregators can charge an annual fee of Rs 50,000 per product for displaying its feature on the website. They can also charge for services at fixed rates for any other outsourcing work like collection of premiums from customers etc. Through sales, they can charge a maximum of 30% of first year premium as a commission. However, they cannot charge anything for putting in place a system for maintaining data base, infrastructure, training or communication.
Currently, there are 8 licensed web aggregators providing such services in India- iGear Financial Services (www.MyInsuranceClub.com), Accurex Marketing and Consulting (www.accuratequotes.in), Great Indian Marketing and Consulting Services (www.insuringindia.com), Voila Consultancy Services India (www.buysmartpolicy.com), eMudhra Consumer Services (www.emudhrainsurance.com), I Call Soft (www.sastapolicy.com), Policy Mantra Insurtrade (www.policymantra.com) and Deztination Insurance Solution (www.policybachat.com).
