In 2005, the Insurance Regulatory and Development Authority of India (IRDAI) has introduced a new distributor type known as Point of Sale (PoS) person, intending to increase penetration in the business.
What is a POSP?
A Point of Sale Person (POSP) is a type of insurance agent who can sell insurance products across various companies and various categories too – life plans, term plans, health plans, and more. He is employed by insurers or corporate agents or brokers. He usually sells over-the-counter (OTC) products which are pre-underwritten and authorized by IRDAI. Such products need not require any further explanation or discussion with clients at the time of the sale.
What are the difficulties faced as a POSP?
A POSP can market only insurance products, that is, they could not offer claim consultancy, risk management services, and so on. They could not explain and sell complex insurance products. They are dependent on insurance brokers or firm to offer service to clients. They need to put extra efforts to deliver the best customer experience as they are less trained.
Why is POSP the best career?
- While normal insurance agents sell can sell the insurance products of their companies alone, POSP can sell policies of multiple insurance companies and across both life and non-life categories.
- POSP can issue the insurance policies straightway without underwriting.
- POSP are provided with easy-to-use and efficient technology platforms to deliver instant service to clients.
- POSP can sell basic and transparent insurance plans which provide entire protection and tax benefits.
- POSP can gain more trust and improve customer relationships as they are locally available for them.
How to become a POSP?
A POSP should be 18 years of age at least and a class 10th pass with a Aadhaar card.
As per IRDAI Regulations, Insurer or any intermediaries will conduct a 14 hours in-house training session and an examination following that. Then they will issue a certificate and maintain the records for at least 5 years.
What are the products that can be sold by POSP?
The policies sold via POSP should be identified separately and pre-fixed by the format ‘POS –(name of product)’. Significantly, they can solicit and market only the below-said pre-underwritten product.
- Motor comprehensive insurance package policy for two-wheeler, private cars, and commercial vehicles.
- Home insurance policy
- Travel insurance policy
- Personal accident policy
- Third party liability policy (for act) for two-wheeler, private car, and commercial vehicles.
- Any other policy which is approved by the authority specifically.
Guidelines on Proposal Form and Insurance Policy to POSP
- In order to tag the policy to POSP who is selling the same, the Aadhaar card number or the PAN card number should be attached in every proposal form (in paper or in paperless form), insurance policy and other related documents.
- The insurance company is responsible to record the Aadhaar number or the PAN number of POSP in proposal form and insurance policy. They shall represent POSP and be responsible for. If there is any misconduct, the insurance company shall make it accountable to a penalty based on provisions of Section 102 of the Act.
- If the sales are effected through an insurance intermediary, they shall record the Aadhaar card number or the PAN card number in the proposal form and makes the insurance company to do the same in insurance policy. As said in the (2) point, the insurance intermediary is responsible for the conduct and POSP and if there is any misconduct, the intermediary shall make it accountable to a penalty based on provisions of Section 102 of the Act.
- While renewing the registration certificate of insurance intermediary, the conduct of the POSP shall also be considered on the rolls of insurance intermediary.
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