Panel for doing away with insurance commission
The expert committee examining the way financial products are sold, which is chaired by Pension Fund Regulatory and Development Authority Chairman D Swarup, will stick to its earlier proposal of banning payment of upfront commission by insurance policyholders. - Pension regulator seeks funds from Finance Ministry - PFRDA to seek tax exemption on withdrawals under NPS - Regulator defers launch of pension scheme - PFRDA appoints 23 entities as Points of Presence - Panel moots 100% equity investment for pension - LIC still eager to manage pension funds of unorganised sector The panel, constituted last year, is giving its report to the government tomorrow. It was also asked, among other things, to suggest how to stop mis-selling of products and how to help raise financial literacy among citizens. The upfront commission decision comes despite severe opposition to the proposal from the insurance industry, which was opposed to the idea of bearing the distribution cost. The Insurance Regulatory & Development Authority and the Life Insurance Council, the industry lobby group, had both opposed the proposal after the committee released a consultation paper in early September. The committee had said upfront commissions embedded in the premium paid be reduced to no more than 15 per cent of the latter immediately, from the current 16.25 per cent. In 2010, this should be brought down to 7 per cent and a zero-commission structure should be in place by April 2011, it had suggested. The committee, after receiving inputs from various industry players, has decided to stick to its position and leave it for the government to decide if the recommendations should be accepted or not, sources familiar with the development told Business Standard. The committee, which had representatives from the insurance industry, was of the opinion that an end to the existing commission structure is needed to stop mis-selling of products, as agents and financial advisors often pushed products where they could earn more. On its part, the insurance industry felt the move would stop companies from pushing policies, as they would have to bear the cost, which would have an impact on their financials. Besides, the industry argued, there was no way to recover the expenses incurred if there was no upfront payment of commission by the policyholder. In recent months, the Securities and Exchange Board of India has barred mutual funds from charging an entry load, forcing fund houses to bear the cost of distribution, despite protests.Quick Loan commented:
The panel is good and hope that they will perform better
19.08.2011
Payday Loans commented:
Panel is well qualified hope they will give the right decisions in the future and bring some good results
05.09.2011
Online loans commented:
The committee, after receiving inputs from various industry players, has decided to stick to its position and leave it for the government to decide if the recommendations should be accepted or not, sources familiar with the development told Business Standard.
23.09.2011
Australian Finance commented:
The group following receiving inputs from a variety of industry players has determined to attach to its position and leave it for the government to choose if the advice must be established or not.
10.10.2011
quickquid commented:
There is a plan for the insurance companies to do away with insurance commissions. This will greatly help in making more investment in insurance
18.10.2011
Wealth Transfer Asia commented:
Its good that the expert committee is examining the way the insurance policy is sold to customer so by doing this they will control the investment of the companies.
21.11.2011
Same Day Loans commented:
Such proposal of banning payment of upfront commission by insurance policyholders is really nice and in my opinion it should be approved.
26.11.2011
Quick Quid commented:
In my opinion,.their sticking attitude to their earlier proposal of banning payment of upfront commission by insurance policyholders is completely fair and reasonable in today\'s circumstances.
09.12.2011
Goa Escorts commented:
You are right. Little spending is needed for earning. Thanks for such sharing.
10.12.2011
QuickQuid commented:
Such abolishment of commission is a good encouragement to sell insurance policy to customers with full truth. Commission was the matter of greed for agents and they use to divert the customers to sell insurance plans to earn such commissions.
12.12.2011
Escort In Delhi commented:
One should be particular about these details.
22.12.2011
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13.01.2012
Family Offices Hong Kong commented:
The pannel is really taking the right decision and it can save the insurance companies in future and also the trust factor in it .Insurance commission has really abolished the honesty factor from insurance industry at some extent.I hope it will be abolished soon.
20.01.2012
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20.02.2012
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28.02.2012
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15.05.2012