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Debate regarding life insurance agents restricted to sell insurance policies of only one insurance company

In India, Insurance Regulatory Development Authority is the government body regulating the insurance market. Included in the role is “specifying requisite qualifications, code of conduct and practical training for intermediary or insurance intermediaries and agents.”

Current regulations by IRDA restrict individuals to act as agent for only one life insurance company at a time (exclusivity clause). This may appear surprising keeping in mind that one of the goals of IRDA is “promoting efficiency in the conduct of insurance business.” If agents are allowed to sell policies of different companies, they can compare different products and suggest ones which they think serve the interest of a client best. Read More …

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Term plan versus pure endowment plan and insurance-cum-investment products in between

Life insurance products are designed for lifestyle protection, children and retirement fund planning, while income tax rebate induces individuals to buy insurance policies. From an operations research (OR) perspective, there is a given insurance cover for which tax savings, sum assured (survival benefit or death benefit), return on investment is maximized given your age, current and projected yearly income and expenditure, and no. of dependents. Read More …

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Relevance of face-to-face marketing for life insurance agents in India

Like many other businesses before the advent of the internet, face-to-face contact was considered essential in selling a product and insurance is no exception with agents bringing a bulk of business for an insurance company. Now, at a time when direct sale of insurance policies by visiting the website of an insurance company or use of comparison websites is picking up because of the internet that eliminates intermediaries like agents, the role of agents, especially in cities and towns with audience comfortable using PC, is redefined. It can no longer be offering and collecting data from clients which can be done by clients themselves through online means. The challenge for agents here is to provide more value-added services by including insurance as part of complete financial planning. Read More …