The Reserve Bank of India (RBI) is reportedly planning to issue a suite of guidelines to enable banks to operate as an insurance brokerage firms.
The new initiative aims to boost the insurance penetration in the country leveraging the widespread branch networks of banks, who serves million of customers.
A senior central bank official was quoted by the PTI as saying, "RBI is likely to finalise the norms by next week. The notification will be issued thereafter."
As per the prevailing RBI policy for bancassurance, a bank can operate as a corporate agent and sell policies of one life insurer and one non-life insurance firm.
Banks in the country would be allowed to act as a broker and sell the insurance policies and services of various underwriting firms.
In his Budget speech (2013-14), Finance Minister P Chidambaram had said, "Banks will be permitted to act as insurance brokers so that the entire network of banks’ branches will be utilised to increase penetration of insurance."