Irdai clears the air on remuneration for insurance web aggregators

The Insurance Regulatory and Development Authority of India (Irdai) made it clear that the remuneration made to the insurance web aggregators will be in line with what is listed for insurance intermediaries.

Irdai was clarifying on the queries of the insurance companies on outsourcing activities undertaken by insurance web aggregators and remuneration payable to them.

In a circular in 2017, Irdai included the web aggregators in the category of insurance intermediaries.

The job of an insurance web aggregator is to provide information on insurance policies of various companies on their website.

Renumeration will be paid to the aggrregators only in case of a lead being converted into policies that are bought by policyholders. However, “no charges shall be paid to the aggregators for transmission of leads to the insurers”.

Moreover, the insurance companies will pay them the same commission that is paid to an intermediary for the post sale operation of a policy that the aggregator will indulge in.

“Insurance web aggregators can get remuneration & rewards for the leads converted into insurance policies. They can also undertake outsourcing functions to provide insurance services in respect of the policies procured through them,” said the Irdai circular.

The payment of commission /remuneration / reward to insurance agents and insurance intermediaries regualtions of 2016 of the Irdai describes the maximum remuneration that can be payable to the intermediaries under which the web aggregators also come in.

Moreover, the web aggregator also charge an annual fee from the insurance companies to display the products their product on their websites.