IRDA advised to study, relax norms for rural branches

Friday 27, April, 2012 The government has asked the insurance sector regulator to examine and relax the branch opening norms for the smaller cities, hoping increased presence of insurance companies will boost penetration of insurance products. There are 23 life and 24 non-life insurers in the country but the penetration of life policies is only 4.4% while non-life is even lower at 0.7%. Insurance firms need prior approval from the Insurance Regulatory and Development Authority, or IRDA, before opening any branch. In a letter to Insurance Regulatory and Development Authority or IRDA, the finance ministry has argued that banking sector regulator the Reserve Bank of India has also eased the norms on branch opening and the IRDA needs to do the same.

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