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More, tighter norms proposed for web aggregators in insurance

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Web aggregators might have to face tighter norms for operating in the insurance sector. In proposed rules, the Insurance Regulatory and Development Authority of India ( Irdai) has suggested the capital requirement (paid- up capital and net worth) would be increased from a minimum of Rs.10 lakh to Rs. 25 lakh. Further, these aggregators would be treated as insurance intermediaries.
If an application for registration is rejected by Irdai or has been withdrawn, the applicant may apply afresh after a financial year has gone by. However, if a foreign promoter or foreign investor has exited for any reason during the preceding two financial years, they would be ineligible to apply.
Web aggregators are entities granted a licence by Irdai and allowed to display insurance product information and comparisons on their sites. Prospective customers can buy products of multiple insurance companies from these portals. However, they are not allowed to sell other financial products on this platform.
With respect to investments, Irdai has proposed that where there are one or more investors in a web aggregator, no investor shall hold shares in exceeding 10 per cent of the paid- up equity capital. Further, all investors jointly cannot hold more than 25 per cent.
Business Standard New Delhi,14th June 2016

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