Health Insurance is among the fastest-growing markets as very few Indian people have health insurance. In its efforts to enhance insurance adoption, IRDAI permitted the development of a distribution mechanism known as Point of Sale Persons (POSP).
This coverage distribution approach was not designed to contend with conventional Insurance Agents rather reach consumers who weren't really served by companies for one purpose or the other. Therefore, what exactly do POSP agents do, and how are they different from insurance agents? Let’s have a closer look.
An insurance representative is someone who operates for an insurer's business and distributes the firm's insurance services. Working using a broker is vital since he or she exclusively sells insurance policies from one firm and is therefore unable and unwilling to evaluate the costs and characteristics of other policies in the industry.
Consultants should never be confused as brokerage (or even insurance suppliers), who may often compare policies from many insurance providers.
A POSP is an insurance provider with the power to engage locally and provide their consumers with possibilities they have never had before. Unlike traditional insurance agents, who can only market insurance policies from their own company, a POSP can offer insurance products from other companies and insurance categories, such as term strategy, life goals, health insurers, etc.
A POSP agent mostly serves first-time consumers seeking simple and basic coverage plans. To service clients, they can grow across geographies such as metropolitan, urban, moderately, and rural locations. Because the things they offer are simple, they sell many of them to make a profit. A POSP has been better adapted to increasing the net scope of insurance and is connected with online sales equipment.
Teaching and Accreditation
A healthcare insurance agent must have completed the 12th grade. They must satisfy the IRDAI exams and complete more than 50 hours of instruction to obtain their certification, which is applicable for three years. The POSP, on either hand, must be a class ten pass. They must also complete a test, although they just need to complete a 14-hour practice session to receive an active certificate for 5 yrs.
What are they able to sell?
A healthcare insurance salesperson can only offer health insurance plans from one provider he is linked with. The POSP agent, contrarily, can offer policies from a variety of insurance providers both in existence and non-life sectors. A POSP, amongst other factors, can sell auto insurance, house insurance, breakdown cover, and personal injury policies.
The distinction between them is in the type of insurance being offered. A health policy representative can both sell and advise policyholders. They can market complicated health goods to individuals, enterprises, and corporations. They can assist them in tailoring policies to match their specific needs and providing policy advice to customers. They may offer high-risk items and typically earn larger commissions.
A POSP agent could only market insurance products that are straightforward and comprehensive, giving complete protection and tax advantages. They sell OTC goods that have been pre-underwritten and authorized by IRDAI. These items are so simple that they have clear and set benefits that do not require complex descriptions for the consumer.
They need not sell difficult or high-risk items thus their commissions are reduced. POSP, unlike the insurance providers, relies on insurance brokers/companies to meet the needs of its consumers.
Where can you find them?
Nowadays, insurance brokers work in big cities and regions based on the needs of the insurance firms. Certainly, they can grow into other sectors and even offer insurance online; however, because their items earn greater commissions, they may concentrate on marketing high-quality commodities rather than a large quantity of simple items to earn extra money.
A POSP agent and an insurance agent are very different people, even though their line of duty is somehow similar. The above are the major differences between an Insurance agent and POSP.