Indian Bank in talks with insurers to become a broker
Indian Bank is in talks with a couple of insurance companies to sell their policies, T.M. Bhasin, chairman and managing director of the lender, said Thursday.
He said the bank would sell the insurance polices through specialised branches instead of leveraging its entire distribution network.
"Insurance broking model is better. We can sell policies of more than one insurer. We will be looking at a basket of products," Bhasin told reporters here.
He said that in order to avoid the risk of mis-selling of policies, the bank would train sufficient personnel and sell the insurance products through specialised branches.
According to Bhasin, the bank currently sells products of United India Insurance Company and Life Insurance Corporation of India through all its branches.
The bank had 2,139 branches at the end of 2013 and plans to open 108 branches next month.
The Insurance Regulatory and Development Authority (IRDA) has issued regulations governing banks becoming insurance brokers.
The Reserve Bank of India (RBI) too has issued its draft guidelines on the subject.
As an insurance agent, a bank can sell products of only one insurer, but as a broker it can sell products of all the insurers.
An insurance broker represents the policyholder and is hence liable for damages in case of mis-selling.
(Posted on 23-01-2014)