Within a month of taking over as the chairman of the Insurance Regulatory and Development Authority (Irda), C S Rao has reversed a decision of his predecessor N Rangachary.
Irda has decided to reintroduce the special 5 per cent discount on premium where the business has been placed directly with insurance companies.
The reversal in the decision spells good news for corporate India, which otherwise would have taken a financial hit.
The insurance broking community, however, will be deprived of their remuneration since companies would prefer to do business directly with insurance companies and get a direct discount on the premium payable.
Representations received from insurers, insured and the various chambers of commerce, have led the regulator to keep the notification of May 30 in abeyance with immediate effect, Rao added.
Just days prior to his retirement, Rangachary after consultation with the industry, decided to dispense with the said facility with respect to non pubic sector entities.
The regulator has now stated,
