The Insurance Regulatory and Development Authority of India has issued the final regulations pertaining to Bima Sugam—Insurance Electronic Marketplace, which will pose as a one-stop solution for all insurance stakeholders, viz., customers, insurers, insurance intermediaries, and agents.
This is in line with the draft regulations released on Feb 13.
The objective is to promote transparency, efficiency, and collaboration across the entire insurance value chain, technological innovation in the insurance sector, universalize and democratize insurance, and to achieve the vision of “Insurance for all by 2047”, as per the Gazette notification dated March 20.
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Key points under the final regulations:
Bima Sugam shall be established by a not-for-profit company formed under Section 8 of the Companies Act, 2013.
The company shall establish, facilitate, develop, operate, and maintain the marketplace for providing various services to the insurance stakeholders.
Shareholding in the company will be widely held among life, general, and health insurers.
No single entity has a controlling stake.
Shareholders shall contribute to capital as and when required.
IRDAI would nominate up to two members on the board of the company.
The board shall constitute a risk management committee to mitigate various risks.
The company shall seek prior approval of authority for the appointment of the chairperson and CEO of the company.
Consent-based architecture for the services.
The Company shall have a Board approved policy on a self-sustainable revenue model.
Consumers shall not be charged for availing services from Bima Sugam.
The regulations also prescribe functions, responsibilities of the company and marketplace, duties and responsibilities of insurers for facilitating the availability of their insurance products for sale, and other services like settlement of insurance claims and grievance redressal in the marketplace on an ongoing basis.
Further, the regulations lay down the power to issue circulars, and guidelines and lays down the power to carry out inspections and penalise for violations.
The regulations, as per the notification, state that they "shall come into force from the date of their publication in the official gazette" which was March 22, 2024.
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