New RBI Grade B 2025 Notification will come Soon! Enroll Here

    Question

    What is the restriction imposed on insurance agents or

    intermediaries regarding commission or remuneration under the Insurance Act?
    A They can receive commission for any policy issued in India without restrictions Correct Answer Incorrect Answer
    B They can receive remuneration only from policyholders Correct Answer Incorrect Answer
    C They are prohibited from receiving any form of commission or remuneration Correct Answer Incorrect Answer
    D They can receive commission or remuneration only as per regulations specified by the insurer Correct Answer Incorrect Answer
    E They can freely negotiate commission amounts with insurers for policies issued in India Correct Answer Incorrect Answer

    Solution

    Section 40. Prohibition of payment by way of commission or otherwise for procuring business: (2) No insurance agent or intermediary or insurance intermediary shall receive or contract to receive commission or remuneration in any form in respect of policies issued in India, by an insurer in any form in respect of policies issued in India, by an insurer except in accordance with the regulations specified in this regard: Provided that the Authority, while making regulations under sub-sections (1) and (2), shall take into consideration the nature and tenure of the policy and in particular the interest of the agents and other intermediaries concerned.

    Practice Next