IRDA notifies amendments to the Advertisement Regulations

The Insurance Regulatory and Development Authority (Insurance Advertisements and Disclosure) Regulations, 2000 (“Advertisement Regulations”) governs the advertising and promotion by insurance companies. IRDA has, vide its notification dated July 1, 2010, carried out the following amendments to the Advertisement Regulations:

1. The definition of ‘intermediary or insurance intermediary’ earlier provided under regulation 2(c) has been removed.

The definition of the ‘intermediary or insurance intermediary’ already exists under the Insurance Regulatory and Development Act, 1999. This has most likely been done to remove any confusion arising out of multiple definitions of the same term.

2. The second proviso to regulation 10(1)(vi) has been deleted. Second proviso to regulation 10(1)(vi) entitled a third party, group or association to collect compensation from an insurance company from the sale undertaken on the basis of the information provided by such group or association of its membership. This was the provision relied upon for most referral arrangements in the insurance industry.

This deletion seems to have been made in the light of Database Regulations. The Database Regulation is expected to take care of the matters relating to sharing of databases.