Now Reading: Insurance seller register won’t fix mis-selling, says Value Research chief
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Insurance seller register won’t fix mis-selling, says Value Research chief
Insurance seller register won’t fix mis-selling, says Value Research chief
Insurance regulator Irdai chairman Ajay Seth has proposed a public register to trace every policy to the person who sold it, so a seller's record follows him across employers. Speaking at the…
The Story in Brief
Insurance regulator Irdai chairman Ajay Seth has proposed a public register to trace every policy to the person who sold it, so a seller's record follows him across employers. Speaking at the insurance brokers' association silver jubilee in Delhi, Seth said this would improve accountability for mis-selling. But Dhirendra Kumar, founder of Value Research, writes in Mint that the register will fail to stop the misuse.
Kumar argues that a register captures frontline sellers while ignoring those who set sales targets and commission structures. He notes that more than one in five complaints against life insurers concerns how a policy was sold, calling it a system working as designed. The real fix, he says, lies in making unsuitable sales unprofitable, not in tracing them after the fact.
The Indian Opinion
The register idea is easy to sell but hard to deliver. It names the agent at the desk while the people who design commissions and targets stay anonymous. That is a convenient sleight of hand for the industry. The real test is whether Irdai cuts commissions that make pushing high-cost endowment plans so lucrative. If the regulator's next move is only a database, and not an incentive overhaul, the machine keeps humming. Watch whether Seth follows the register with stricter commission rules.
Source: livemint.com
This story was synthesised by AI from the source linked above.
