Cracking its whip on insurance web aggregators, the Insurance Regulatory and Development Authority (IRDA) has issued tough new rules that could drive many of the operators out of business.
IRDA has stipulated that the aggregator, besides having a minimum net worth of Rs10 lakh, should register with the regulator.
It was not mandatory for aggregators to register with IRDA. But now they will have to shell out Rs10,000 for a three-year registration.
Aggregators put up dedicated sites or portals that offer information on insurance products, highlight their salient features and the premiums on various schemes. Many of them also provide comparisons between the schemes of different insurance companies, tempting visitors to their site to choose insurers.
When a visitor ultimately buys an insurance product, after searching for it on the aggregator's site, the latter gets a substantial commission from the broker or the insurer, and a smaller one for the lead.
Aggregators will now not be allowed to feature sponsored content on their websites, nor can they use any ratings, rankings, endorsements or feature best-seller insurance products.
''Web aggregators shall not display ratings, rankings, endorsements or bestsellers of insurance products on their website,'' says the IRDA. ''The content of the websites of the web aggregators shall be unbiased and factual in nature; they shall desist from commenting on insurers or their products in their editorials or at any other location in their websites.''