The Insurance Regulatory and Development
Authority of India (IRDAI) on recently
said an insurnce company would be responsible for all acts & omissions of
its agents and would be liable to a penalty of up to Rs. 1 crore.
Issuing guidelines for appointment of insurance
agents, IRDAI said: “The insurance firm shall be responsible for all acts and
omissions of its agents, including violation of code of conduct specified under
these guidelines, and shall be liable to a penalty which may extend to Rs. 1
crore.”
Further, any person who acts as an insurance
agent in contravention of the provisions of norms would be liable to a fine,
which may extend to Rs. 10,000.
Also, “any insurer (Insurance firm) or any person
acting on behalf of an insurer, who appoints any person as an insurance agent
not permitted to act as such or / transact any insurance business in India
through any such person shall be liable to penalty which may extend to Rs. 1
crore,” the guidelines said.
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As per the new norms, no person could act as an
insurance agent for more than one life insurance firm, one general insurance
firm, one health insurer & one of each of other mono-line insurers.
IRDAI said there should be a ‘centralised list of
agents’ which contains all details of agents.
It also said where the agent represents more than
one insurer offering same line of products, “he should dispassionately advise
the policyholder on the products of all Insurers and the product best suited to
the specific needs of the prospect.”
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