Bima Sugam platform will solve insurance mis-selling: Debasish Panda

A day after Finance Minister Nirmala Sitharaman flagged ‘forced selling’ of insurance products by banks, chairperson of the Insurance Regulatory and Development Authority of India (IRDAI) Debasish Panda said that the Bima Sugam platform would help resolve the issue to an extent.

Mr. Panda, however, maintained that selling insurance through banks was a “useful system”. “Banks, with a longstanding and continuous relationship with customers, offer a unique opportunity to build trust and enhance distribution efficiency, creating a robust ecosystem for inclusion,” he said on the second day of the SBI Banking and Economics Conclave 2024, here on Tuesday.

He, however, admitted that there were snags in the system that needed attention and work.

“I believe that there is merit in this system, but we have to do it with care and caution so that you don’t forget your activity and only start selling insurance,” he said.

Bima Sugam, a company backed by IRDAI, is a digital platform showcasing insurance products for the customers to choose from.

The IRDAI chief said that the sector was growing at a compound annual growth rate (CAGR) of above 10% over the last 10 years. n In 2023-24, the sector grew at a rate of 13% and Assets Under Management (AUM) of over ₹70 lakh.

He forecast premiums to grow at 7.1% in real terms in the next five years, and asserted that it would be more than the global growth which would be at 2.4%.

Besides talking about the glitches in the insurance system and the outlook for the sector, Mr. Panda underlined the role of the sector in India’s economic growth for the quarter century.

“Insurance sector is a significant contributor to the economy in its role as a provider of patient long-term capital, supporting economic infrastructure, offering stability to the markets, and facilitating sustainable growth. This sector also generates substantial employment from agents on the ground to analysts, actuaries, and professionals working on innovative products and technologies,” he said.