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APPOINTMENT OF AGENTS,LICENSING OF AGENTS AND IRDA

REGULATIONS

A presentation by : Sanjay Singh,

Assistant Secretary (Mktg)

CENTRAL OFFICE

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RECRUITMENT STATISTICS INDUSTRY

CALENDAR YEAR

NO. OF AGENTS RECRUITED BY LIC

NO. OF AGENTS RECRUITED BY PVT COMPANIES

2004 142190 (72 %) 54857 (28 %)

2005 153707 (62 %) 93169 (38 %)

2006 141735 (23 %) 476494 (77 %)

2007 235640 (23 %) 800439 (77 %)

2008 276356 (26 %) 794497 (74 %)

2009 265732 (36 %) 473225 (64 %)

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AGENT’S STATISTICS

FINANCIAL YEAR

RECRUITMENTS AND REINSTATEMENTS

TERMINATIONS

2003-04 264934 154382

2004-05 164132 221305

2005-06 206779 196233

2006-07 197963 147199

2007-08 234842 144145

2008-09 345729 194617

2009-10 312547 254596

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STATISTICS FOR INDUSTRY 2009-10

NAME OF THE COMPANY TOTAL

AEGON RELIGARE LIFE INS. CO. LTD. 900

ALLIANZ BAJAJ LIFE INS. CO. LTD 34318

AVIVA LIFE INS. CO. LTD. 6952

BHARTI AXA LIFE INS. CO. LTD. 7610

BIRLA SUNLIFE INS. CO. LTD 41997

DLF PRAMERICA LIFE INSURANCE COMPANY LTD 312

FUTURE GENERALI INDIA LIFE INS. CO. LD. 11832

HDFC STANDARD LIFE INS. CO. LTD 20652

ICICI PRUDENTIAL LIFE INS. CO. LD. 50922

IDBI FORTIS LIFE INS. CO. LTD. 1621

ING VYSYA LIFE INS. CO. LTD. 15421

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STATISTICS FOR THE INDUSTRY 2009-10

NAME OF THE COMPANY TOTAL

KOTAK MAHINDRA OLD MUTUAL LIFE INS. CO.LTD. 3209

MAX NEWYORK LIFE INS. CO. LTD. 11750

MET LIFE INDIA INS. CO. LTD. 7747

RELIANCE LIFE INS. CO. LTD. 59816

SAHARA LIFE INS. CO. LTD. 703

SBI LIFE INS. CO. LTD. 26287

SHRIRAM LIFE INS. CO. LTD. 1769

TATA AIG LIFE INS. CO. LTD. 42880

TOTAL PVT. COMPANIES 346698

LIFE INSURANCE CORPORATION OF INDIA 192627

TOTAL 539325

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APPOINTMENT OF AGENTS GOVERNED BY

• AGENTS (RULES), 1972- NOTIFIED BY THE GOVT.

• IRDA (LICENCING OF INSURANCE AGENTS) REG. 2000

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IRDA REGULATIONS

• IRDA (LICENSING OF INSURANCE AGENTS REGULATIONS, 2000 notified on 14th July 2000

• IRDA (LICENSING OF INSURANCE AGENTS) AMENDMENT REGULATIONS, 2002 notified on 16th October 2002

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PROCESS

• MINIMUM EDUCATIONAL QUALIFICATIONS FOR GRANT OF FRESH AGENCY LICENCES

RURAL URBAN

• PRE RECRUITMENT TRAINING– OFF LINE TRAINING– ONLINE TRAINING– DURATION OF TRAINING

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STANDARD INSTRUCTIONS/GUIDELINES

• NO PRODUCT TRAINING

• ATTENDANCE RECORD TO BE MAINTAINED

• FACULTY- ASSOCIATE/FELLOW

• PAYMENT DETAILS

• CERTIFICATE OF ACCREDIATION

• IN CASE OF DP CHANGE, AUTHORISATION BY CORPORATE DP

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PRE RECRUITMENT TEST

- ON LINE AND OFF LINE- DATA- NO. OF ATTEMPTS - TIME FRAME- FEES- DURATION

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NEW LICENSING PORTAL

W.e.f. 05.01.2010, IRDA has launched a new licensing portal:

Integration with all stakeholders, viz. IRDA, Insurers, Agent Training Institutes, Examination Bodies and Insurance Agents

Agency Licensing Portal would be entry point in the licensing process with Registration

Unique Reference Number would be generated and used throughout agent licensing process

Data corrections can be directly made by Designated Persons

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Process flow

• Sponsorship form – Ensure all fields are correctly filled.

• Scanned photograph size should not exceed 50KB.

• Scanned signature size should not exceed 10KB.

• Select ATI• ATI will log in and key in Training slot to be

allocated.

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Process Flow ( Contd.)

• ATI will then register the candidate for examination.

• After the candidate undergoes training, the ATI will fill in training details.

• Examining Body shall upload the result.

• Interview.

• Issue licence.

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ISSUE OF LICENCE

• FORM

• DESIGNATED PERSON

• FEES

• TIME FRAME TO ISSUE LICENCE

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RENEWAL OF LICENCE ( CONTD)

• Go to renew Licence option on the Licensing Menu.

• Key in transaction password and PAN Number.

• Renew Licence

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RENEWAL OF LICENCES

• PROCEDURE

• GRACE PERIOD

• TIME FRAME

• RENEWAL OF LICENCE OF TERMINATED AGENTS

• ISSUE OF NOC

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RENEWAL OF LICENCE

• PROCESS FLOW– VA form to be filled by the agent– If Post IRDA agent, then 25 hours training

shall be required.– Before undergoing training, request for

licence renewal.– Select ATI.– ATI will key in training slot– After training, ATI will key in training Details

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RENEW OF LICENCE AFTER DATE OF EXPIRY

• Same procedure to be followed as mentioned in earlier slide.

• Annexure “A”, DD for Rs.1000 drawn in favour of LIC of India payable at Mumbai to be sent to Central office Marketing Department.

• Licence renewal shall be approved by Corporate DP.

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RECONCILIATION OF WEB WALLET ACCOUNT

• WEB WALLET ACCOUNT

• RECONCILIATION PROCESS

• PRINTING OF LICENCES

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COMPOSITE LICENCEConversion of Individual to Composite

Request for Composite Licence on portal

Upload photo and signature

Enter Training details ( 25 hours)

Register for examination

Examining body will upload result

Issue Licence

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COMPOSITE LICENCE

Conversion of Composite to Individual

Obtain NOC from the other insurer.

Go to Withdraw Composite Licence option on the Licensing Menu.

Select which part you wish to withdraw.

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CRITICAL ISSUES IN LICENCING

• CANCELLATION OF LICENCE

• ISSUE OF DUPLICATE LICENCE

• LICENCES NOT RENEWED FOR MORE THAN ONE OCCASION

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CRITICAL ISSUES IN LICENCES

• SIGNING OF LICENCES WHEN DP IS ON LEAVE

• COMPOSITE LICENCES NOT TO BE ISSUED WITHOUT NOC

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Reinstatement Objects:

Arrest high termination of Agents.

Conserve Agency force that has been already created.

Support PDOs during initial period.

Develop existing Direct Agents to much higher level of performance.

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PURPOSE for revised Reinstatement rules:• To ensure Continuance of agency in the

Competitive scenario.

• To offset the impact of temporary under performance of potential agents and get them back in field.

• To liberalise the process of Reinstatement after an agent becomes eligible for Renewal Commission as we get the agent back in our fold without any extra cost.

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PURPOSE

• To decentralize the authority further for effective implementation & effective resource enhancement.

• Advantage to PDOs as he can use cases of reinstatement beyond one year & reappointment as his resource.

• Facilitate Development Officers who are working for this purpose by their being appropriately rewarded.

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Background

• Recruitment process:

• Time Consuming

• Costly

• Difficult

• Number of agents of Competitors is increasing very fast.

• Terminated agents are easy targets for our competitors.

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WHO CAN BE REINSTATED

• AGENTS TERMINATED DUE TO NON FULLFILMENT OF MBG

• AGENTS TERMINATED DUE TO EXPIRY OF LICENCE

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WHO CANNOT BE REINSTATED

• Agents terminated on grounds of a vigilance Enquiry,Disciplinary action, early claim etc.

• Agents who have resigned.

• Agents whose date of termination beyond 24 months.

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REINSTATEMENT OF AGENCY DURING FIRST FIVE YEARS OF AGENCY

• Marketing Manager is the competent Authority for reinstating the agency of a terminated agent if the date of reinstatement of agency is within 12 months from date of termination.

• Marketing Manager is the Competent Authority to reinstate agency within 12 months from date of termination of agency maximum on two occasions.

• Senior Divisional Manager is the competent Authority for reinstating the agency of a terminated agent if the date of termination is beyond 12 months but within 24 months from the date of termination. Such type of reinstatement is allowed only where the termination is for the first time. Such cases are treated as “Second Reinstatement Cases”.

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REINSTATEMENT OF AGENCY DURING FIRST FIVE YEARS OF AGENCY ( Contd.)

• Senior Divisional Manager is the competent Authority for reinstating the agency of a terminated agent on third occasion.

• Regional Manager ( Marketing) is the Competent Authority for reinstatement in 5th agency year even if it is First reinstatement.

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REINSTATEMENT OF AGENCY BEYOND FIVE AGENCY YEARS

• Once an agent becomes entitled for Renewal Commission, there is no limit on the number of occasions such agent to be reinstated provided the agency is reinstated within 24 months of date of termination of agency.

• On first three occasions, the competent authority for reinstatement shall be the Marketing Manager.

• Such reinstatements beyond three occasions shall be done by Senior Divisional Manager I/c.

• Care to be taken that reinstatement is not being done only to avail the Gratuity benefits.

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ATTACHMENT ON REINSTATEMENT

• Reinstatement within 12 months from Date of termination of agency – Attached to same Development Officer.

• Reinstatement after 12 months but before 24 months from Date of termination of agency – Attached to the Development Officer who motivates the agent for reinstatement.

• Agents who appointed as Direct, shall be Direct only on reinstatement .

• No Urban Career agent on reinstatement shall be attached to any Development Officer

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REAPPOINTMENT

• Agents who are not reinstated within 24 months from date of termination will be reappointed.

• Senior Divisional Manager I/c is the competent Authority for re-appointment.

• Agents who have been terminated on account of vigilance enquiry, disciplinary action, early claim etc., should not be reappointed.

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REAPPOINTMENT

• The agent on re-appointment shall be attached to the Development Officer who motivates him/her for re-appointment.

• Direct agents on reinstatement shall be Direct only.

• No Urban Career agent on reinstatement shall be attached to any Development Officer

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Reinstatement Data

Data of Agents terminated during last four years:

Year No. of Agents Recruited

No. of agents Reinstated

No. of Agents Terminated

% of agents reinstated to terminated

2005-06 154934 51845 196233 26.42

2006-07 159426 37921 146583 25.87

2007-08 206429 28413 144145 19.71

2008-09 300541 45188 194617 23.22

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Activities Expected at Branch and Division Level

• Generate list of Agents terminated more than 12 months back whose agency is presently not reinstated.

• Provide such lists to Development Officers/ PDOs.

• Communicate to such agents that they have an opportunity for reinstatement/reappointment as the case may be.

• Survey may be conducted to ascertain the reasons of their termination and their need of support structure.

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THANK YOU