IRDAI Meeting with IBAI Board on May 21st
June 12, 2020
To All Broker Members,
Re: IRDAI Meeting with IBAI Board on May 21st
Dear Fellow Broker Members,
Hope you are safe and well.
The IBAI Board had a meeting with the IRDAI Chairman and other senior IRDAI Officials on May 21st, 2020 to discuss key requests of the broking community The Authority has shared a letter highlighting the action items for IBAI, attached herewith for your reference. Please see below, a summary of the same –
· Trade Credit Guidelines –The Authority has asked lBAl to furnish comments on the exposure draft placed on IRDAI website. The draft guidelines already include majority of our requests on Trade Credit insurance. A separate communication has been shared with all broker members seeking comments on the same.
· BAP – Your association has been sharing broker concerns on BAP with the Authority on a regular basis. We request all broker members facing issues on BAP write to the Authority seeking resolution. Request you to also share the same with IBAI to ensure that we can also take the same up with the Authority. We would like to once again request all broker members to be prompt in filing the returns.
· Market Conduct lssues – The Authority has been receiving complaints on market conduct issues. The Authority expects that IBAI advise all its members to maintain highest professional standards, maintain credibility and take concrete steps for sensitization.
We are all aware that broking community has attracted best of talent in the insurance market. The contribution of broking community in serving the policyholder continues to rise rapidly year after year which can be seen from the total premium placed by brokers for non-life insurance. I am sure the broking community is committed to maintain high standard of professional conduct. If there are some isolated incidents then, we all should work harder to ensure that they are further reduced so that the reputation and the professional standards of brokers continues to rise.
As brokers, we are united in our resolve to bring value and protect the interests of our customers. IRDAI in the last several years, has recognized the same and thus, allowed IBAI to conduct online renewal training for brokers. IBAI has sought approval for conducting the 50 hours broker training for BQPs and will take up the same with the Authority again. Furthermore, lBAl will be coming up with various initiatives on sensitizing brokers and conducting regular trainings to ensure that we maintain the highest professional standards. Please also see attached, the Code of Conduct prepared by IBAI applicable to all members in addition to the Brokers Code of Conduct under the IRDAI (Insurance Brokers) Regulations, 2018.
· Reinsurance Placements – Recent requirement of IRDAI for reinsurance / composite brokers to get reinsurance premium payment confirmation directly from the reinsurers has added some serious practical challenges. However, IRDAI expects that the broking community does every possible effort to comply with the same. We are certain all broker members are doing their best to meet with this new requirement which seems to be somewhat unique in the international market.
IRDAI expects that all the broker members should comply with the same fully. However, inspite of our best attempts if we have challenges which are beyond our control, then we should highlight this to the Authority. We are believe the goal of the Authority is to create one more reliable and strong method which gives assurance to all the stakeholders. If there are any alternate solutions which meet the purpose of the regulator and are at the same time practical to implement, then we should deliberate on the same and present it to the Authority for its consideration.
In the meantime all of us should commit to comply with this new requirement which will instill greater confidence in the stakeholders.
· How to stimulate growth in MSME sector due to situation caused by COVID-19 – Authority has asked IBAI to share a write-up on the same. Request broker members to please share their suggestions on the subject with us at firstname.lastname@example.org
We will continue to engage with Authority on matters of interest for the broking community. We look forward to inputs from broker members on the above and on other IBAI initiatives.