Insurers flout norms, use pyramid selling schemes
Pyramid schemes, where recruiting more sellers is more important than selling, aren’t new in India. An investigation by ‘Outlook Money’ magazine, the content partner for Mint’s personal finance coverage in the Business of Life section, reveals that such schemes are now being used by corporate insurance agents -- in violation of norms laid down by the Irda
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I would like to draw the attention of IRDA, how partcularly some of the pvt players' corporate agents selling product through MLM marketing system.Basically I would tell about Guwahati city, where more than a dozen firms of diferent names selling Birla sunlife, Reliance life, Tata AIG etc... policy under MLM marketing method. Interetingly those person doesnot have a valid IRDA licence. moreover they basically sells only one single plan indiscriminating the customer need & promising a return of lakh rupees in a year by investing only Rs.6000 or Rs.12000.This is totally unlawful activities violating all the criteria set by our Regulator for the safety of the policy holders' interest.By this activities only the insurers are being benefited & belive it or not those firms by the name of corporate agency,are earning some crores of Rupees just by misselling & violating all rules of IRDA.Even the local branches of those insurer knows the facts & even encouraging the same to fullfill their target.If this are results of regulation, I would tell that we were safer in the non regulation regime
kalyan