There will be more agent jobs in the insurance sector from April 1, thanks to the Insurance Regulatory and Development Authority of India’s (IRDAI’s) move to relax norms.
Slew of reforms
TS Vijayan, Chairman of IRDAI, had indicated that insurers will be allowed to hire agents directly without the mandatory training hours as part of a slew of regulatory changes lined up in the wake of the Government’s Ordinance to hike the Foreign Direct Investment limit in the insurance sector to 49 per cent from 26 per cent, among other reforms. A draft in this regard has been released.
At present, it is mandatory for all agents to undergo a minimum of 50 hours of training in life and general insurance segments while for a composite agent covering both the sectors, 75 hours of training is required.
According to the draft, agents can directly apply to an insurer for an agent licence without undergoing the mandatory training. According to IRDAI data, last year, the number of agents had gone up for the first time in three years.
It had gone up from 2.12 million as on March 31, 2013 to 2.18 million as on March 31, 2014.
“An applicant (however) shall pass in the Insurance Agency Examination conducted by the Insurance Institute of India, Mumbai, or any other examination body approved by the Authority in the Life, General, Health Insurance as the case may be, in the syllabus notified by the Authority from time to time,’’ IRDA said in the proposed norms. The difference now is that the specified number of training hours is not required but the insurance company will have to suitably ensure that an agent is well trained before taking up the examination, IRDAI said.
The flexibility in the training aspect is seen as a positive by the industry. “With the removal of the mandatory training hours, we can save a lot on expenses on account of providing training for the agents and suitably devise our own training programmes,’’ Manoj Kumar Jain, CEO, Shriram Life Insurance Company, told BusinessLine .
There are about 1,600 recognised brick and mortar agent training institutes across the country with an almost an equal number of online trainers. According Sanjiv Bajaj, Managing Director, Bajaj Finserv, the proposed new norms will remove the bottlenecks in the agent hiring process and also place greater responsibility on the agent and the company.
To attract youngsters
Individual agents too are happy. “Removal of the mandatory training hours will attract more youngsters to come to the profession,’’ said P Venkatesh, a senior agent with the Life Insurance Corporation of India.
The industry, however, is hoping for more flexibility.
“According to the exposure draft, clearing of the examination is still a must for aspiring agents. Insurers should also be allowed to conduct their own examinations, failing which the full advantages of this move will be deprived,’’ said the CEO of a private insurance company, who did not want to be named.