The Reserve Bank of India today released on its website, ‘Draft Guidelines on Entry of Banks into Insurance Business –Insurance Broking Business’ for comments and feedback. Comments / feedback on the draft guidelines may be sent by email latest by December 31, 2013 to the Chief General Manager, Department of Banking Operations and Development, Reserve Bank of India, Central Office Building, 13th Floor, S.B. Singh Marg, Mumbai –400001.

It has been decided to permit banks to undertake insurance broking business departmentally. Since Insurance Broking is a knowledge intensive activity which requires professional expertise, this will be permitted subject to the certain conditions. Banks desirous of offering insurance broking services should seek specific prior approval of Reserve Bank of India. Validity period for the approval granted for insurance broking will be three years subject to review thereafter.

Alpana Killawala

Principal Chief General Manager

Bank insurance broking entry requires specific prior regulatory approval and adherence to prescribed professional and operational conditions. Banks may undertake insurance broking departmentally only with specific prior approval from the Reserve Bank, subject to prescribed conditions and demonstration of professional expertise; approvals are granted for a three year validity period subject to subsequent review, and the Reserve Bank has invited comments on the draft guidelines before finalisation.