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Run an E Commerce Platform for insurance policies

Times are changing. To keep up with the, the IRDAI has created provisions that companies or LLPs can use to establish an e commerce platform to sell insurance policies. Registrationwala can guide you in acquiring the mandatory permission you need to start an insurance e commerce platform.

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Insurance Self network Platform Process

Step 1
Documentation
Step 2
Application filing
Step 3
Application Assessment
Step 4
E commer portal's assessment
Step 5
Grant of permission to setup ISNP

Insurance Self-Network Platform in India

What is an ISNP?

Insurance Self Network Platform or an ISNP, is an e-commerce portal dedicated to dealing with insurance services in India. E-commerce is prevalent in all forms of products and services these days. It has provided the providers of those products and services with better reach and low costs of transactions. To ensure that the same goes for insurance services, IRDAI, or India's Insurance Regulatory Development Authority, has provided the E-Commerce Insurance Self-Network Platform registration.

If you're willing to adhere to the conditions set forth by the IRDA, you can run your e-commerce portal dedicated specifically to selling insurance policies. This portal will be called the Insurance Self Network Platform (ISNP).

Objective of an ISNP

Insurance Self-Network Platforms (ISNPs) are an effective medium to increase insurance penetration and enhance financial inclusion cost-effectively. Hence, the Authority, as part of its developmental mandate, issues these guidelines to promote e-commerce in the insurance space, which is expected to lower the cost of transacting insurance business and bring higher efficiencies and greater reach. 

Services offered by the ISNP

A registered ISNP can dispense the following services in an Insurance market:

  • Issue Insurance Policy documents or certificates to the consumers.
  • Assignment registration
  • Nominations enlistment
  • Nomination updations
  • Manage insurance surrender, maturity, withdrawals, free-look cancellations, and return benefits.
  • Payouts
  • Organizing medical check-ups and submitting medical reports to the insurer in case of medical or life insurance.
  • Issue insurance products endorsement
  • Providing loans against insurance policies
  • Fund Switching
  • Updating Terms and Conditions of an Insurance policy
  • Intimating changes in the Terms and Conditions of an Insurance policy to the policyholders.
  • Collecting renewed premiums and issuing remittances to the insurer(s)
  • Periodically updating customers' information.
  • Declaration of Updates
  • Extention of an insurance cover
  • Review or cancel an insurance policy like
    • Insurance Policy Transfer 
    • Duplicate Insurance Policy
    • Death and Maturity Claims

Any other service relating to insurance products and services.

 

ISNP vs. Web Aggregator

An ISNP and an insurance web aggregator provide an interface to sell insurance products online. The only difference between them lies in their scalability. An insurance company that is an ISNP can onboard multiple web aggregators on its platform. It can pool the insurance policies from each aggregator, thus providing an integrated platform that hosts the comparison modules of each insurance web aggregator along with other insurers on the platform. Also, Multiple Insurance Web Aggregators can showcase their insurance policies on a single Insurance Self Network Platform. An ISNP can aggregate many Insurance Web Aggregators.

Eligibility Criteria: before registering as an ISNP

If any business entity wants to become an Insurance Self-Network Platform, it must satisfy the following conditions before filing for the ISNP registration with the IRDAI. These regulations also inform of the role of the Authority in verifying someone's application and granting them the IRDA ISNP license.

  • The applicant must be 
    • an Incorporated Company or
    • a registered Limited Liability Partnership.
  • The applicant business entity must appoint a principal officer to oversee its Insurance Self-Network Platform business.
  • The applicant must conform to all the guidelines mentioned in the form ISNP-1.
  • The applicant must prove that the e-commerce portal can automate the process and maintain data privacy.
  • The applicant must not commence any activity related to insurance e-commerce without formally registering the  ISNP after obtaining permission from the Authority.
  • The applicant must pay the ISNP license processing fee of ten thousand rupees plus applicable taxes. This fee is non-refundable.
  • Existing ISNPs who have already set up their insurance portals for selling and servicing insurance products must continue to operate these portals. They must comply with the guidelines within three months and obtain the necessary permission from the Authority.
  • The applicant must complete its ISNP registration application within 15 days, after which the incompleted application will stand canceled.
  • The Authority must decide on a filed application within 60 days of submitting all documents.

Documents required for an ISNP Certification

To start an e-commerce website dedicated to selling insurance policies, you must attach the following documents to the ISNP registration application form:

  • Certificate of Incorporation of the applicant
  • Memorandum of Association of the applicant
  • Articles of Association of the applicant
  • Details of the directors and shareholders of the applicant business entity
  • A document containing the description of the business of the applicant
  • Details of the management personnel
  • Details of steps taken to prevent unauthorized access
  • Details of procedure implemented for disaster recovery
  • Details of the encryption implemented to safeguard customer information
  • Details of the Information Security management system
  • Source code of the e-commerce portal
  • CERT-in certification of the E-commerce portal

Process for IRDA ISNP registration

Following is the procedure that's to be implemented to start an ISNP:

  1. Prepare and compile the above-mentioned documents.
  2. File the online application for ISNP registration.
  3. Upload and submit the requisite documents in the proper format.
  4. Pay the ISNP license registration processing fee of ten thousand rupees.
  5. Submit the application to the authorities for assessment.
  6. The Authority will then assess the application along with the source code of the e-commerce portal.
  7. The applicant can be asked to correct some information or provide them during the assessment. The Authority can also issue summons to the applicant if discrepancy(s) arise during the application assessment.
  8. Applicant can check their application status regularly on the website.
  9. Upon successful verification, the Authority will issue the ISNP license to the applicant within 60 days of application filing.

ISNP certification fee

The license processing fee to register a firm as an Insurance Self-Network Platform is ten thousand rupees. This fee is non-refundable.

ISNP Compliances

Monitoring:

A registered ISNP must ensure: 

  • that the integrity of the automatic data processing systems is maintained at all times. 
  • Privacy of data is maintained for both insurance companies and consumers. 
  • Adequate internal mechanisms for reviewing, monitoring, and evaluating its controls, systems, procedures, and safeguards.

Review of operations: 

  • A registered ISNP must delegate the review of controls, systems, procedures, and safeguards atleast once a year to an external Certified Information System Auditor (CISA) or Chartered Accountants with DISA (lCAl) qualification or CERT-IN expert at their cost. The scope of such an external audit of the ISNP must be as prescribed by the Authority from time to time.
  • A registered ISNP must comply with the Information Security Management System Standards of the ISO (International Organization for Standardization) or the IETC (International Electro-Technical Commission) or its equivalent of the ISNP, at all times, by having an annual review of the systems.
  • The applicant shall place the report of the CISA auditor or DISA (ICAI) qualified expert or CERT-IN expert and the information security management system of the ISNP before the Board or its sub-committee for their observations.
  • Any adverse findings which are material to the operations of the ISNP of the applicant or which result in financial loss to the policyholders shall be reported to the Authority along with an action plan to address them.

ISNP Audit:

The Authority has the right to undertake by itself or through an external agency an independent inspection into the affairs of a registered ISNP at any time if it so desires. But it must notify the ISNP beforehand by issuing a notice. The Authority must also specify in the notice the documents to be furnished by the ISNP, which would be useful during the inspection.

Validity

An ISNP certification is valid till the certificate of incorporation of the ISNP is valid. In the case of insurance intermediaries such as an Insurance Broker or a Corporate Agent, the permit is valid until their license gets revoked or canceled.

ISNP License revocation 

  • A registered ISNP can dispense its designated duties in the market till its certificate of registration is valid.
  • In the case of an insurer, the validity of the certificate is valid unless it is revoked. 
  • The Authority may revoke the ISNP license granted at any time if it is of the view that the activities carried out on the ISNP is: 
  • not in the interest of the policyholders,
  • not conducive to the orderly growth of the industry,
  • violating the code of conduct issued by the Authority, 
  • not meeting the requirements as specified in the IRDA guidelines, or 
  • Violate the provisions of the 
    • Insurance Act of 1938, 
    • IRDA Act of 1999, 
    • lnsurance rules, regulations, guidelines, circulars, orders, notices, etc., issued by the Authority.

In any case, the ISNP must be given an opportunity of being heard by the Authority.

How can Registrationwala help you get ISNP setup permission in India?

When you take on the task of obtaining the ISNP registration, you'll realize that filing the application is merely the tip of the iceberg. There is a lot more depth to the process, and there are several nuances to it that can increase the time it takes to get the registration. Therefore, you should find consultants that can expedite the process for you. Registrationwala is one of those consultants. We can provide you services like:

  • Document drafting
  • Application filing
  • Department follow up

So, if you're in a hurry to start your own insurance e-commerce portal, reach out to Registrationwala.

Insurance Self Network Platform (Frequently Asked Questions)

Q. What is the full form of an ISNP?

A. The ISNP stands for Insurance Self-Network Platform.

Q. What is an ISNP?

A. Insurance Self Network Platform or an ISNP is an e-commerce portal dedicated to dealing with insurance services in India. E-commerce is prevalent in all forms of products and services these days. It has provided the providers of those products and services with better reach and low costs of transactions. To ensure that the same goes for insurance services, IRDAI or India's Insurance Regulatory Development Authority, has provided the E-Commerce Insurance Self-Network Platform registration.

Q. What is the purpose of setting up an ISNP?

A. Insurance Self-Network Platforms (ISNPs) are an effective medium to increase insurance penetration and enhance financial inclusion cost-effectively. Hence, the Authority as part of its developmental mandate, issues these guidelines to promote e-commerce in the insurance space, which is expected to lower the cost of transacting insurance business and bring higher efficiencies and greater reach. 

Q. What is the similarity between an ISNP and an Insurance web aggregator?

A. An ISNP and an insurance web aggregator provide an interface to sell insurance products online.

Q. What is the difference between an ISNP and an Insurance web aggregator?

A. The only difference between them lies in their scalability. An insurance company which is an ISNP can onboard multiple web aggregators on its platform. It can pool the insurance policies from each aggregator, thus providing an integrated platform that hosts the comparison modules of each insurance web aggregator along with other insurers on the platform. Also, Multiple Insurance Web Aggregators can showcase their insurance policies on a single Insurance Self Network Platform. An ISNP can aggregate many Insurance Web Aggregators.

Q. Who is eligible to become an ISNP?

A. Any business entity which is an insurance intermediary, agency, or insurance company can start its own Insurance Self-Network Platform.

Q. What are the pre-conditions for setting up an ISNP?

A. If any business entity wants to become an Insurance Self-Network Platform, it must satisfy the following conditions before filing for the ISNP registration with the IRDAI:

  • The applicant must be 
    • an Incorporated Company or
    • a registered Limited Liability Partnership.
  • The applicant business entity must appoint a principal officer to oversee its Insurance Self-Network Platform business.
  • The applicant must conform to all the guidelines mentioned in the form ISNP-1.
  • The applicant must prove that the e-commerce portal can automate the process and maintain data privacy.
  • The applicant must not commence any activity related to insurance e-commerce without formally registering the  ISNP after obtaining permission from the Authority.
  • The applicant must pay the ISNP license processing fee of ten thousand rupees plus applicable taxes. This fee is non-refundable.
  • Existing ISNPs who have already set up their own insurance portals for selling and servicing insurance products must continue to operate these portals. They must comply with the guidelines within three months and obtain the necessary permission from the Authority.
  • The applicant must complete its ISNP registration application within 15 days, after which the incompleted application will stand canceled.
  • The Authority must decide on a filed application within 60 days of submitting all documents.

Q. What are the required documents to submit with the ISNP certification application?

A. To start an e-commerce website dedicated to selling insurance policies, you must attach the following documents to the ISNP registration application form:

  • Certificate of Incorporation of the applicant
  • Memorandum of Association of the applicant
  • Articles of Association of the applicant
  • Details of the directors and shareholders of the applicant business entity
  • A document containing the description of the business of the applicant
  • Details of the management personnel
  • Details of steps taken to prevent unauthorized access
  • Details of procedure implemented for disaster recovery
  • Details of the encryption implemented to safeguard customer information
  • Details of the Information Security management system
  • Source code of the e-commerce portal
  • CERT-in certification of the E-commerce portal

Q. What are the services offered by an ISNP?

A. A registered ISNP can dispense the following services in an Insurance market:

  • Issue Insurance Policy documents or certificates to the consumers.
  • Assignment registration
  • Nominations enlistment
  • Nomination updations
  • Manage insurance surrender, maturity, withdrawals, free-look cancellations, and return benefits.
  • Payouts
  • Organizing medical check-ups and submitting medical reports to the insurer in case of medical or life insurance.
  • Issue insurance products endorsement
  • Providing loans against insurance policies
  • Fund Switching
  • Updating Terms and Conditions of an Insurance policy
  • Intimating changes in the Terms and Conditions of an Insurance policy to the policyholders.
  • Collecting renewed premiums and issuing remittances to the insurer(s)
  • Periodically updating customers' information.
  • Declaration of Updates
  • Extention of an insurance cover
  • Review or cancel an insurance policy like
    • Insurance Policy Transfer 
    • Duplicate Insurance Policy
    • Death and Maturity Claims

Any other service relating to insurance products and services.

Q. For how long an ISNP certificate is valid?

A. An ISNP certification is valid till the certificate of incorporation of the ISNP is valid. In the case of insurance intermediaries such as an Insurance Broker or a Corporate Agent, the permit is valid until their license gets revoked or canceled.

Q. What are the monitory compliances a registered ISNP must conform to?

A. A registered ISNP must ensure: 

  1. that the integrity of the automatic data processing systems is maintained at all times. 
  2. Privacy of data is maintained for both insurance companies and consumers. 
  3. Adequate internal mechanisms for reviewing, monitoring, and evaluating its controls, systems, procedures, and safeguards.

Q. How does the IRDA conduct inspection of a registered ISNP?

A. The Authority has the right to undertake by itself or through an external agency an independent inspection into the affairs of a registered ISNP at any time if it so desires. But it must notify the ISNP beforehand by issuing a notice. The Authority must also specify in the notice the documents to be furnished by the ISNP, which would be useful during the inspection.

Q. How to register an ISNP in India?

A. Following is the procedure that's to be implemented to start an ISNP:

  1. Prepare and compile the above-mentioned documents.
  2. File the online application for ISNP registration.
  3. Upload and submit the requisite documents in the proper format.
  4. Pay the ISNP license registration processing fee of ten thousand rupees.
  5. Submit the application to the authorities for assessment.
  6. The Authority will then assess the application along with the source code of the e-commerce portal.
  7. The applicant can be asked to correct some information or provide them during the assessment. The Authority can also issue summons to the applicant if discrepancy(s) arise during the application assessment.
  8. Applicant can check their application status regularly on the website.
  9. Upon successful verification, the Authority will issue the ISNP license to the applicant within 60 days of application filing.

Q. What is the application fee for ISNP certification?

A. The license processing fee to register a firm as an Insurance Self-Network Platform is ten thousand rupees. This fee is non-refundable.

 

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