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An Insurance Marketing Firm is an IRDAI-registered business entity that solicits, procures and services insurance products from multiple insurers (life, general and health). It can also distribute financial products after obtaining due approval from concerned authorities. In this blog post, we shall provide you with the lists of insurance and financial products an IMF entity can offer.
The lists include insurance products like insurance for non-loanee farmers and combi products and financial products like SEBI-regulated mutual funds and PFRDA-regulated pension funds.
An IMF can tie up with multiple insurance companies, i.e., up to six insurers in each line of business (life, general and health insurance). Because of this, it can offer a wide range of insurance products.
According to Regulation 3(a) of Insurance Regulatory and Development Authority of India (Registration of Insurance Marketing Firm) Regulations, 2015, an IMF can offer the following products :-
All types of products sold on an individual and/or retail basis, including crop insurance for non-loanee farmers and combi products.
Property, group personal accident, group health, Guaranteed Surrender Value Insurance (GSLI) and term insurance policies for Micro, Small and Medium Enterprises (MSME). Please note that the IMF is not permitted to solicit or procure commercial lines of business for any segment other than MSMEs.
An IMF can market the following financial products through Financial Service Executives (FSEs), according to Regulation 3(c) of the IRDAI (Registration of IMF) Regulations, 2015 :-
Mutual funds of mutual fund companies regulated by Securities and Exchange Board of India (SEBI).
Pension products regulated by Pension Fund Regulatory and Development Authority (PFRDA).
Other financial products distributed by SEBI Registered Investment Advisors.
Banking / financial products of banks/ NBFC regulated by the Reserve Bank of India (RBI).
Non-insurance products offered by the Department of Posts, Government of India.
Any other financial product / activity allowed by the Authority from time to time.
The IRDAI-registered IMF must enter into formal tie-ups with insurers before soliciting and procuring their insurance products through insurance sales persons. Additionally, if the firm wants to market financial products, it must appoint Financial Service Executives (FSEs) holding valid licenses from the relevant financial regulators.
During business operations, the IMF must ensure adherence to the prescribed limits on the number of insurers per line of business. In addition to this, the IMF registration must be renewed in a timely manner to continue the IMF business smoothly in a legally compliant manner.
An IMF can offer a wide range of insurance and financial products. Insurance products it can solicit and procure are specified in Regulation 3(a) of IRDAI IMF Regulations 2015. They include property, group personal accident, group health, guaranteed surrender value insurance (GSLI) and term insurance policies for Micro, Small and Medium Enterprises. The financial products an IMF can market are specified in Regulation 3(c). They include mutual funds regulated by SEBI, pension products regulated by PFRDA and non-insurance products offered by the Department of Posts.
Want to register an insurance marketing firm in India? Check out the following link to learn about eligibility criteria, documentation and process for insurance marketing firm registration → https://www.registrationwala.com/insurance-marketing-firm.
Q1. Can an IMF market mutual funds of mutual fund companies regulated by the Securities and Exchange Board of India?
A. Yes, an IMF can market mutual fund products of mutual fund companies regulated by the Securities and Exchange Board of India through the authorized Financial Service Executives (FSEs).
Q2. Can an IMF market pension products regulated by the Pension Fund Regulatory and Development Authority?
A. Yes, an IMF can market pension products regulated by the Pension Fund Regulatory and Development Authority through the authorized Financial Service Executives (FSEs).
Q3. How many insurers can an IMF tie up with?
A. An IMF can tie up with multiple insurers to distribute insurance products. It can partner with up to six insurers in each line of business (life, general and health insurance).
Q4. Who is a Financial Service Executive (FSE)?
A. According to IRDAI IMF Regulations, 2015, an FSE is an individual employed by an Insurance Marketing Firm, who holds a valid license issued by the respective financial regulators, other than IRDAI, to market the products specified in Regulation 3(c).
Q5. Can an IMF market banking products of RBI-regulated banks?
A. Yes, an IMF can market banking products of RBI-regulated banks through the authorized Financial Service Executives (FSEs).
Don't let regulatory hurdles slow down your business growth. Whether it's tie-ups with 6 different insurers or appointing Financial Service Executives (FSEs), we provide end-to-end support for your IMF setup.
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Hi, I'm Sachin Chawla. I’m a commerce graduate from Agra University and a Chartered Accountant (2015) with DISA certification. I focus on helping businesses with formation, management, tax and FEMA matters, IP advisory, risk management and auditing. Through my articles, I aim to share my expertise and provide practical guidance in these areas.
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