Low insurance penetration in India is compelling the regulator to work on guidelines for “monoline” insurance agents selling only one product.
These insurance agents will be authorized to sell one simple insurance product and will undergo training. Post training these agents will get policy documents that are very simple and easy to understand. The forms will be pre-underwritten and preferably a one page document.
Insurance agents selling monoline products will not have to undergo a detailed training as they will not be selling complex products. For instance a car dealer having knowledge about cars and basics about car insurance may be allowed to sell car insurance policies. Similarly, it will not take much effort for small general stores to keep forms of very basic insurance policies like a cheap term plan as it has standard benefits.
More number of people may be interested in becoming a monoline insurance agent because of the ease and flexibility of earning extra income by way of commission. Once the guidelines are in place, insurance companies will stand a much better chance at widening the reach of their products to remote and untapped areas.
The penetration of life insurance products in India is much higher than that of general insurance products. General insurance products include health insurance plans, car insurance, personal accident insurance etc. Because of the spiraling costs of hospitalisation expenses and medical care, there is a serious need for increasing the awareness of good health insurance products that will take care of unforeseen medical expenses. If such products are easily made available and simple enough for the common man to understand, people will not hesitate in buying them.
