Selling of General Insurance policies through Kirana Stores

In order to take insurance products to the doorsteps of customers, the Insurance Regulatory and Development Authority is giving finishing touches to guidelines for “monoline” insurance agents — agents who will be authorised to sell only one simple insurance product. An Irda official said the idea was to improve the penetration levels of insurance and deepen financial inclusion. “Since the opening of the sector, the penetration of life insurance has risen from 1 per cent to 6 per cent. But for the general insurance industry, it has remained at 0.6 per cent, which is very low compared to other developing countries. These steps are the need of the hour,” said Gaurav D Garg, managing director & CEO, Tata AIG General Insurance Company. The guidelines will reduce the mandatory training hours as monoline agents will have to sell only one product. At present, Irda mandates a 25-hour training module, which covers every product under the general insurance industry starting from home and fire to marine hull and aviation. “The monoline agents will not have to understand the complex products. They will be trained only on the simplest of products which they will sell,” said the Irda official. Mr. Krishnamoorthy Rao, MD & CEO, Future Generali India Insurance Co Ltd said, “Such initiatives would be a welcome step to enhance distribution network for low cost General Insurance policies. Coupled with the Aadhaar number initiative this can help financial inclusion in a big way in the rural areas. The industry will have to come out with simpler, easy to understand insurance covers with policy literature in simple local languages so that the buyer can easily understand what he is buying. All this will help in increasing the penetration of general insurance. Along with this simplifying the procedure for mono-line insurance product distributors like travel agents or motor dealers would be helpful for the industry”.