April 6, 2016
The insurance regulator IRDAI has received applications from over 40 banks to sell the insurance policies of multiple insurers under new bancassurance rules that took effect from 1 April.
IRDAI Member-Life, Mr Nilesh Sathe, said that the banks include several which have their own insurance subsidiaries, reported Press Trust of India. There had been speculation previously whether banks with insurance subsidiaries would be interested to work with multiple insurers simultaneously, because they might not be keen to sell the products of competing insurers or because of exclusive distribution conditions. Last September, IRDAI announced that it would allow banks to tie up with multiple insurers under an open architecture. Under the new rules, banks can sell policies of up to three insurers in each of the segments— health, life and general. The previous rule allowed banks to form bancassurance arrangements with only one life, one non-life and one standalone health insurer.
Over 60 financial entities court India Post
Meanwhile, several insurance companies and top global financial firms Barclays, Citibank, Deutsche Bank, Western Union, Visa and domestic giants State Bank of India and Punjab National Bank are among over 60 companies that are in the queue to work with the payments bank arm of India Post. Insurers wooing India Post include HDFC Life, ICICI Lombard, ICICI Prudential, Bajaj Allianz, Kotak Life Insurance, Royal Sundaram and PNB Metlife, reported the Times of India. The financial institutions are attracted by the postal network of about 150,000 post offices across the country, including 130,000 in rural areas.
A large-scale modernisation drive has been taking place across these offices, including computerisation and the gradual rollout of banking solutions and ATMs. Telecom and IT minister, Ravi Shankar Prasad, who is also in charge of the Department of Posts, said: “With India Post having got a payments bank licence, there is a scramble to forge partnerships and alliances.” India Posts received in-principle approval from the Reserve Bank of India on 7 September last year for a payments bank to be set up within 18 months. The payments bank is likely to become operational by March 2017, said Mr Prasad.