Insurance Web aggregators24th April 2021 1 By indiafreenotes
- “Act” means the Insurance Act, 1938 (4 of 1938), as amended from time to time.
- “Agreement” for the purpose of these regulations means an agreement entered into between a web aggregator and an Insurer;
- “Authority” means the Insurance Regulatory and Development Authority established under the provisions of Section 3 of the Insurance Regulatory and Development Authority Act, 1999 (41 of 1999);
- “Distance Marketing” for the purpose of these regulations refers to the process of solicitation or sale of insurance products or services where the consumer is physically not present at the point of solicitation or sale or the conclusion of the sale, and the process is accomplished through telephone or Short Messaging Service (SMS) or e-mail or Internet or web services;
- “Lead” for the purpose of these regulations means information pertaining to a person who has accessed the website of a web aggregator and has submitted contact information of any kind, for obtaining information on prices or features/benefits of insurance products;
- “Lead Generation” for the purpose of these Regulations, is the process of collecting the details of the prospects to ascertain their intention to purchase insurance, before proceeding with solicitation of insurance products;
- “Lead Management System” (LMS) for the purpose of these Regulations refers to the Software implemented by the Web Aggregator for recording, filtering, validating, grading, distribution, follow up and closure of leads from the enquiries received on the website of the Web Aggregator;
- “Outsourcing”: for the purpose of these Regulations means activities which can be carried out by the Web Aggregators to the extent as specified by the Authority.
- “Person” means
- A company formed under the Companies Act, 1956 (1 of 1956); or
- A limited liability partnership formed under the Limited Liability Partnership Act, 2008 (6 of 2009) with no partner being a non-resident entity/person resident outside India as defined in clause (w) of section 2 of the Foreign Exchange Management Act, 1999 (42 of 1999) FEMA, and not being a foreign limited liability partnership registered there under; or
- Any other person recognized by the Authority to act as a Web Aggregator;
j. “Principal Officer” means
- A director / partner, who is responsible for the activities of the Web Aggregator in the case of a body corporate; or
- The chief executive officer appointed exclusively to carry out the functions of a Web Aggregator;
- “Solicitation” for the purpose of these Regulations is defined as the approach of a Prospect by an insurer or an intermediary with a view to convince the Prospect to purchase an insurance policy;
- “Tele caller” for the purpose of these Regulations is a person engaged by a Telemarketer for carrying out the Telemarketing and Distance Marketing related work;
- “Telemarketer” for the purpose of these Regulations, is an entity registered with Telecom Regulatory Authority of India under Chapter III of The Telecom Commercial Communications Customer Preference Regulations, 2010 (as amended from time to time);
- “Web Aggregator” for the purpose of these regulations is a person licensed by the Authority under these Regulations;
- “Website” is a set of related web pages served from a single web domain. A website is hosted on at least one web server, accessible via a network such as the Internet or a private local area network through an Internet address known as a Uniform resource locator. The word ―website‖ includes a web portal and/or a mobile site for the purpose of these regulations;
- “Designated Website” for the purpose of these regulations is a website(s) with domain name(s) registered, owned by and used exclusively for the functions of the Web Aggregator;
- Words and expressions used and not defined in these Regulations but defined in the Insurance Act, 1938 (4 of 1938), the Insurance Regulatory and Development Authority Act, 1999 or in any of the Regulations made there under shall have the meanings respectively assigned to them in those Acts or Regulations.
Eligibility criteria for License of the Web Aggregator:
- For the grant of License / Renewal of license of the web aggregator, the applicant shall ensure the fulfilment of the conditions including but not limited to the following:
- The applicant is a person as defined under regulation 1 (i).
- The Memorandum of Association of the company or such other documents of applicants shall have the business of web aggregation of Insurance Products only as its main object.
- The applicant is not engaged in any other business other than the main object (Web Aggregation of Insurance Products) of the applicant;
- The applicant shall not be licensed / registered as an insurance agent, corporate agent, micro-insurance agent, TPA, surveyor, Loss assessor or any other Insurance Intermediary under the relevant Regulations framed by the Authority.
- The applicant shall not have a referral arrangement with an Insurer.
The applicant shall not be a related party of an insurer, insurance broker, corporate agent, micro-insurance agent, TPA, Surveyor or a loss assessor or other insurance intermediary at any time.
- The Principal Officer shall possess the required qualification as specified by the regulator
- The Principal Officer of the Web Aggregator should have undergone 50 hours of training initially and 25 hours of renewal training at the end of every three years thereafter.
- The Principal Officer / Directors / Promoter(s) / Shareholders / Partners / Key Management Personnel should fulfil the conditions in the FIT and PROPER criteria notified by the authority from time to time.
- The web aggregator should not have violated the obligations and the code of conduct as specified by the regulator.
- The Authority is of the opinion that the grant of license will be in the interest of policyholders.
Application seeking Grant of License.
- An applicant, seeking grant of License as Web Aggregator shall make an application to the Authority in the specified application Form.
- The application shall be accompanied by a non-refundable fee of rupees ten thousand paid by way of a bank draft drawn in favour of ‗Insurance Regulatory and Development Authority‘ payable at Hyderabad.
- Applicants seeking permission for Outsourcing and Telemarketing functions/facility shall mention the same specifically in the application Form.
- The applicant seeking grant of license as Web Aggregator shall fulfil all the eligibility conditions as specified under the relevant sections of these regulations and fulfil the conditions mentioned in these Regulations.
- The application for grant of license as Web Aggregator shall be dealt by the authority as per the applicable provisions and under these Regulations.
- On the applicant fulfilling all the eligibility criteria and requirements mentioned in these Regulations; the authority shall grant License to the applicant to function as a Web aggregator
- A license once issued shall be valid for a period of three years from the date of its issue, unless the same is suspended or cancelled pursuant to these Regulations.
- An application, which is not complete in all respects, shall be liable to be rejected.
- Application seeking Renewal of License:
- Web Aggregators interested in continuing in the business shall apply with the Authority for renewal of the License at least THIRTY DAYS before expiry of the previous License. The application for renewal of license should be accompanied by a fee of rupees ten thousand Applicants seeking permission for Outsourcing and Telemarketing functions / facility shall mention the same specifically in the application Form.
- No Web Aggregator shall be allowed to carry out the functions of the Web Aggregator, after expiry of the license.
The application for renewal of license as Web Aggregator shall be dealt with by the authority as per the applicable provisions and under these Regulations.
- A Web Aggregator, before seeking a renewal of license, shall ensure that their Principal Officer has received at least twenty-five hours of theoretical and practical training from an institution recognized by the Authority from time to time.
- The Authority, on being satisfied that the applicant fulfils all the conditions specified for renewal of a license, shall renew the license for a period of three years and send intimation to that effect to the applicant.
- Wherever it is found that the Web Aggregator is not doing any amount of business during the entire/part of the previous licensed period, the Authority may refuse to renew the license.
- Employees of the Web Aggregator:
- The employees of the Web Aggregator involved in insurance solicitation and verification should have completed the fifty hours of theoretical and practical training on insurance from an institution recognized by the Authority from time to time and passed an examination, at the end of the period of training mentioned above, conducted by the National Insurance Academy, Pune or any other examining body recognized by the Authority.
- Tele-callers deployed by Web Aggregators to solicit business should be employees on the rolls of the Web aggregator and should have undergone training as prescribed by Authority.
- Web Aggregators shall be responsible for all acts of commission and omission of the employees deployed on their behalf.
- The capital of the web aggregator shall be issued and subscribed in the form of Equity Shares where the web aggregator is a company registered under Companies Act, 1956.
- The web aggregator shall have a net worth not less than Rupees ten lakh at all times.
- The Web Aggregator shall submit to the Authority a net worth certificate duly certified by a Chartered Accountant every year after finalisation of books of accounts.
Duties and Functions of web Aggregators.
- a) The Web Aggregator shall
- Display Information pertaining to the Insurers who have signed agreement with the Web Aggregators.
- Carryout the activities for the purpose of Lead Generation for insurers.
- Ensure that the information systems, (both hardware and software) including the aggregation website(s) / portals, Lead Management System and the Data Centers hosting the website(s) / Portal(s) / Lead Management System are in compliance with the generally accepted information security standards and procedures in force in India from time to time.
- Ensure that the leads and other data is transmitted to the insurers and others using secured layer data encryption technologies like 128 bit encryption.
- Use only RBI licensed payment gateways for collection and transfer of premium to insurers when the web aggregator is authorized by the insurer to collect the premium on behalf of the insurer.
- Ensure to get the information systems (both hardware and software) including the aggregation website(s) / portals, Lead Management System and the Data Centers hosting the website(s) / Portal(s) / Lead Management System Audited by CERT-In empanelled Information Security Auditing organisations once in a financial year and submit a copy of the Audit Certificate/Report to IRDA and the insurers with whom the web aggregator has entered into an agreement, within 15 days from the date of receipt of the same.
b) The Web Aggregators shall not:
- Display any information pertaining to products or services of other financial institutions / FMCG or any product or service on the website
- Display advertising of any sort, either pertaining to any product or service including insurance product or service, other financial products or service / or any other product or service in the Web Aggregators Website.
- Operate multiple websites or tie up with other approved/unapproved/unlicensed entities/websites for lead generation / comparison of product etc. subject to few exceptions.
- Operate the websites of other Financial / Commercial / marketing or sales or service entities or use other Social Media sites etc. for comparison of products etc.
- Operate in any other manner for the purpose of transmitting leads to any entity engaged in insurance business except these following regulations.
Nomenclature of Web Aggregators
i) All Web Aggregators shall have the word `Insurance Web Aggregator‘ or Insurance Web Aggregators` in the name of the Insurance Broking Company to reflect its line of activity and to enable the public to differentiate IRDA licensed insurance Web Aggregator from other non-licensed insurance related entities. The application of the new applicant companies making an application to seek the license to act as web aggregator shall not be considered in the absence of the compliance of the nomenclature requirement.
ii) Every licensed insurance Web Aggregator shall display in all its correspondences with all stakeholders its name registered with the Authority, address of the Registered and Corporate Office, IRDA license number and validity period of the license.
iii) Insurance web aggregators are not permitted to use any other name in their correspondence/literature/letter heads without the prior approval of the Authority.
- Agreement of Insurer with a Web Aggregator:
- An Insurer desirous of obtaining leads from web aggregator shall enter into an “agreement” with the web aggregator approved by the Authority which shall necessarily include details relating to, though not limited to, the following:
i) Time-frame and mode of transmission of leads to be shared
ii) Onus of complying with regulatory and other legal requirements on both the parties to the agreement.
iii) Identifying the different data elements to be shared (viz., name of prospect / client (visitor of the web site), contact details etc)
iv) The timeframe for providing the premium and feature tables of the agreed products to the Web Aggregator after concluding the agreement and keeping them up to date.
- The agreement between an insurer and web aggregator shall be valid for a period of three years from its date, subject to the validity of license of web aggregator.
- The web aggregator shall file the agreement with the Authority within fifteen days from the date of entering the agreement.