Mr. Kulbhushan Nandwani, AVP, NJ Group
Mr. Kulbhushan Nandwani, face of the NJIB, has a very rich experience in financial advisory and distribution of financial products of over 15 years. In past, he has worked in various capacities with NJ India Invest Pvt. Ltd. as Head - Investment Products & Zonal Sales Head. He has been also very actively engaged in setting Insurance Business and Estate Planning services at NJ Group.
As we all are aware that Wealth Protection is the base of any financial planning, we can not think of any Financial Plan keeping Insurance aside.
Insurance provides us with the protection to the different uncertain risks associated with our Life, Wealth and health.
If we talk about the risk associated with human life, it is the risk of early death, hospitalisation due to any disease or accident, damage to our property and any physical disability due to any external event. So it becomes very important to plan for these uncertain risks in our lives by opting for various insurance covers. There are many insurane products available in the market like Term life insurance, Health insurance, Motor insurance, Critcal Illness insurance, Personal Accident insurance, Householder insurance, Travel insurance etc. etc.
There are 24 life insurers, 27 general insurers and 7 stand alone health insurers are operating in the Indian market now.
Inspite of having big industry span, penetration in indian insurance market is very low as compared to developed countries like UK and USA.
As per the industry overview of 2017-18, out of the total fresh premium collected of Rs 66,918 Cr in life insurance, term plan which is a pure protection plans only comprises 1,200 Cr which is only 2% of total premium.
If we compare top 10 life insurance market in the world, the contribution of pure protection premium is 76% and saving premium is 24%, while we have pure protection premium of only 5% against the saving premium of 95% in totality.
Health insurance industry has recorded maximum growth of 26% last year. This shows the awarness generated among the indian people about their health. Subsequently, motor industry has grown by 19%, general insurance industy by 18% and life insurance industry by 13% last year.
In India, the insurance products are distributed majorly by four players, Brokers, Corporate Agents, Tied Agents and Bank. Looking at the demographic features in India, this intermediaries have not been able to dive deeply to serve the Indian market. This is the reason why we have this much lower penetration in Indian market inspite of having huge potential for the insurance market.
With a view to increase the penetration in the insurance sector and to reach up to the last person of India to serve them insurance products, IRDAI has allowed insurance companies and insurance intermediateries to recruit Point of Sales Person, who can solicit the pre-underwritten Insurance products approved by IRDAI.
What is POSP?
It is the insurance intermediary approved by IRDAI to sell the personal line of insurance products which are pre-underwritten in nature and available on a single click.
Who can become POSP?
Following are the citeria to become the POSP.
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He should be minimum 18 yerar of age
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He should be 10th Standard pass
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He should have undergone for the training of 15 hours followed by the Examination.
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He should not have any other agency with any insurer or intermediatery.
Process to become POSP.
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You have to register yourself with your basic KYC.
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You need to undergo Online training of 15 hours for each stream
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After completing the online training, you need to appear for a simple examination held by the particular insurer or broker.
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After passing the exam, your code will be automatically generated which will be universal for that particular body.
The limit of POSP products are defined by the regulator as these are pre-underwritten products. For example, POSP can sell term insurance plan with sum assured (SA) subject to Non Medical Limits, health insurance maximum up to 5 lac of SA and car insurance up to 50 lac of SA only. By this way the liability created by selling these products are kept limited to avoid the misuse of these products against the principals of insurance. It also covers overseas mediclaim, critical illness and personal accident insurance, also with limited sum assured.
For a advisor, who is already into distribution of other Financial products like Mutual fund, FD, Bonds etc, it becomes very logical for him to get associate as a POSP to an intermediary and hence solicit retail insurance products to his set of clients.