The Insurance Regulatory and Development Authority of India (IRDAI) allowed special and privileged tie ups between insurance companies and banks. Tie-up would result in better sales for insurers as they can extend their network and catch hold on extended population. Banks played a role as agents till yesterday, can take up the role of promoters or partners now on. Banks to enter into the business were picked up based on their risk of weighted assets and non performing assets. But this news has aged out, now corporate agents can even join their hands with insurers to expand network. This is regulated with strict boundaries in both the network size and also quality. Corporate agents can enter into agreement with 3 insurers one in life insurance, non – life insurance and health insurance. Corporate agent should not hold more than 90% of each insurer for first year which will further be reduced to 75%, 60% and 50% in upcoming years. So which means that every corporate should have a tie up with more than one insurer for each category. Tie-ups are into action to implement “Insurance for all” scheme by 2020.
JAM ( Jan dhan, Aadhar, Mobile) represents the insurance for all scheme in India 2015-2016. Aadhar and mobile used as identification to ensure non-leakage environment. Jan dhan yojana scheme happened recently which gave birth to millions of bank accounts for rural people, insurance amount will be deducted and matured amount will be paid back through it. Life of citizens is expected by GOI and RBI to move safely with these implementations.