While opening bank accounts or availing other banking services, bank customers have sometimes been forced to buy insurance products. This will be stopped by the insurance regulator, Insurance Regulatory and Development Authority of India (IRDAI). IRDAI has said that no customer can be asked to buy insurance mandatorily by corporate agents.
“Where the insurance is sold as an ancillary product along with a principal business product, the corporate agent or its shareholder or its associates shall not compel the buyer of the principal business product to necessarily buy the insurance product through it,” IRDAI said. It added that the chief executive officer and the chief financial officer of the bank will have to give a declaration saying that they have not forced customers to buy insurance through them alone.
IRDAI has permitted corporate agents, including banks, to tie up with up to three life, three non-life and three standalone health insurers.