Insurance Regulatory and Development Authority now wishes an absolute repair of the regulation overriding the insurance agents. As of now the insurance watchdogs seems to urge for a modification in rules in order that the insurance is vended as long-term products.
Insurance agents shall now be bordered by fresh rules which are placed by the insurance regulator IRDA. However the thought behind the set of laws is to motivate the investors to remain invested for the long-term.
The rules are targeted at curtailing the yield rate and the number of policies that may slip.
Moreover if any group's annual preserving ratio is less that 50%, then in that case the agency's license shall not be renewed. Persistency ratio is a gauge to calculate the number of insurers holding the policy and who join on to the epoch of the policy.
Every agent shall have to vend at least 20 policies and get a minimum of 1.5 lakhs of new prospect premium every year.
Family members of the workers of insurers may not be employed as agents by the same insurer. And lastly, in the matter of a policy lapse the agent's commission shall be suspended in the initial year and paid only on the grounds of continuity in the later years.
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