Impact of FY 2013 budget on Insurance

The Union budget of FY 2013/14 had a few interesting updates for the Insurance industry.

  • All towns with a population in excess of 10,000 will have a LIC branch, and also of one of the PSU general insurers. By 31st March 2014.
  • No prior approval is needed to open up a branch in Tier II town by any Life Insurance or General Insurance company
  • Bank KYC will suffice for a new Insurance policy sale
  • Banking Correspondents will now be allowed to sell micro-insurance in rural areas
  • Banks will now have the option of taking up a broking license. This would mean that Bancassurance which has been the 2nd largest channel for most private Insurers will see a significant disruption.