IRDAI introduces a new business model for insurance intermediaries

IRDAI has introduced a new distribution channel to tap rural markets - ‘Bima Vahak’.

Bima Vahaks will distribute life and general insurance policies in rural areas at gram panchayat level through a hand-held electronic device.

IRDAI said that anyone can become an individual Bima Vahak or a corporate Bima Vahak to distribute specified policies available on ‘Bima Vistaar’, a digital platform that will enable agents to onboard new clients and make claim request completely online. However, IRDAI will approve policies that can be sold under this platform.

What is important for you is that existing intermediaries can become a corporate Bima Vahak to distribute insurance policies in rural areas and appoint individual Bima Vahaks as sub distributors in these locations.

Here is a gist of this initiative:

• Both insurers and corporate Bima Vahaks can appoint individual Bima Vahaks
• Bima Vahaks along with the insurer will be responsible for actions and the conduct of sub brokers
• Bima Vahaks cannot charge fee for their services. However, they are entitled to receive the commission
• Bima Vahaks can sell insurance policies, do KYC and facilitate claim servicing
• Women should be encouraged to take up distribution business
• Individual Bima Vahaks can tie up with one life insurance, one non-life insurance, one standalone health insurance and one agriculture insurance
• Insurance councils like Life Insurance Council and General Insurance Council will set up terms and conditions, education standards and code of conduct for Bima Vahaks
• If a Bima Vahak leaves the job, the policies serviced by him will be given to another Bima Vahak within the same territory
• In case of exit of corporate Bima Vahak, insurers will have to ensure uninterrupted service to the policyholder
• Insurer will have to issue a physical card to individual Bima Vahaks
• Corporate Bima Vahak will have to issue their name, name of the Bima Vahak, name of appointing insurer and telephone number of branch office in their id card
• The ID should also comprise contact details of grievance redressal officer and the insurance ombudsman
• Insurers will have to identify nearest local branch office to handle complaints

Bima Vahak will into effect post the launch of Bima Vistaar platform, clarified IRDAI.