Government propose to amend the Insurance Act 1938

You all are aware that the Government and IRDA propose to amend the Insurance Act 1938 in the coming session of Parliament. These proposed amendments in the act will:


1. Stop payment of balance commission and gratuity to the widow of an agent, means the hereditary commission goes,


2. Powers of the Parliament to decide the rates at which commission to a life insurance agent of LIC as well as that of a private insurer have to be paid, will be transferred to IRDA. Means the rates of commission will be decided by IRDA.


3. Delete the provision of prohibition of stopping of payment of commission to insurance agents.


These amendments will dismantle the agency structure in India prepared after years of hard work and after spending hundreds of crores.


This will cause lakhs of crore loss to the Government in the form of premium not received which is being utilized for long term investment in the infrastructure development of the country. The story of mutual fund, PPF and General insurance is before us where in business has been badly reduced due to neglect of insurance advisors/agents.


Please recall the recent draconian suggestions made by Devendra Swaroop committee to stop payment of commission to us.


In the light of the above we have decided to launch nation wide agitation against these proposed amendments in the Insurance Act.


vinay mohanty