Regulation is license raj with another name, it appears. India's insurance regulator has issues some rather stringent - and in our opinion, disastrous-for-the-industry - guidelines, applicable by February 2012, which significantly restrict the activities of online insurance aggregators - companies like Intel Capital and Info Edge backed PolicyBazaar, EasyPolicy.com, EasyInsurance, ApnaPaisa.com, among others. In a nutshell, here's what the guidelines force insurance aggregators to do: 1. Brings web aggregators under registration & Inspector Raj: Web aggregators will have to apply to receive an approval from the IRDA, in order to be allowed to offer web aggregation of insurance. There's an application fee of Rs 10,000, and a web aggregator needs to have a net worth of Rs 10 lakhs. The authority will approve the web aggregator for a period of three years, after which there will be a renewal. Note that the minimum-net-worth has been brought down from Rs 50 lakh in the draft guidelines. The authority is going appoint "one or more of its officers or a qualified chartered accountant as an inspecting authority to undertake inspection of the premises of the web aggregator to ascertain and see how activities are carried on, and also to inspect the books of account, records, and documents of the web aggregator". Our Take: well, not exactly licensing, but registration, but there's hardly a difference. Why create this layer of approvals for just aggregators? This is a regressive, bureaucratic move, and ensures that startup web aggregators need to get an approval from the IRDA…
