The web Insurance aggregation segment in India is headed for another disaster, if the insurance regulator IRDA goes through with a restrictive and regressive set of guidelines it has made public, as draft, for consultation. These guidelines essentially convert web aggregators into insurance agents and telemarketing firms, ignoring the efficiency that is inherent in an online lead generation and comparison business, and the fact that they are, well, aggregators of insurance products for comparison purposes, and not necessarily sales agents or telemarketing firms. Apart from there, there are limits on Foreign Direct Investment, no money from lead generation, guidelines for employee training, how comparison has to be done, number of websites that can be run, no use of Social Media...it goes on and on. There are even limitations on what insurers can and cannot pay web aggregators for. To say that these guidelines are restrictive is an understatement. They're calling them "Web Aggregators", but it is likely that, if these guidelines are implemented, stand-alone, web-only insurance aggregators will cease to exist. Remember that web aggregators like PolicyBazaar had been forced to enter the call center business after the last set of regressive guidelines from the IRDA, because the last set of guidelines had made their business unviable. We wonder if the mandate the IRDA has is to discourage competition and innovation in assisting consumers in buying insurance, or is it merely to put web insurance aggregators out of business. There is little in these guidelines that would encourage someone to set up a…
