Reaching out

“At present, brokers are operating mostly from big cities. It is desirable that we increase the penetration of insurance in semi-urban and rural areas. Sub-broking is one model which can help increase penetration and spread of insurance,” underlines the report. Companies must ensure that their employees and persons who solicit insurance business are competent professionals and adhere to the code of conduct prescribed.

They will have to educate the client on all necessary details of insurance products they seek to solicit and make him aware about his rights and duties. The price quoted will be strictly as per the terms from the insurer and that cannot add any additional pricing to the policy.

The sub-broker will have to make clear communication to the client about the inception of the insurance cover and acceptance of the proposal by the insurer and no endorsement or midterm variations to the policy wording will be arranged without the specific requests or mandate of the client.

Analysts say the recommendation made by the committee will help reduce misselling, which has become rampant in the life insurance industry over the past few years. Irda had highlighted the widespread mis-selling in life insurance products in its 2011-12 annual report. The regulator's analysis shows

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