SUB-COMMITTEE REPORTS

AGENCY MATTERS

Association Membership

The number of agency units registered under the General Insurance Agents Registration Regulations (GIARR) as at 31^st December 2007 and 2008 are as below:-

As at 31^st December 2008, the number of registered general insurance agents was 38,766 representing a decrease of 1% compared to 39,165 in 2007. 49% (i.e. 18,864) of the registered agents transact business with only one Principal.

The distribution of agents in the respective states in Malaysia and Singapore are as below:-

Online Agency Registration System (OARS)
The agency registration exercise was first introduced in 1988 under the Inter-Company Agreement on Agencies. Applications were submitted and processed on manual basis and payments were made using postal/money order for each agency application.

Taking advantage of IT, an online agency registration for agents was implemented in June 2005. Under the OARS, the processing time for registration of agents had been reduced tremendously from 10-14 days under the manual system to 1-2 days under the online system. The mode of payment was also replaced with a monthly billing through the OARS for ease of administration of the processing fees payable by agents.

Since the implementation of the OARS, a total of about 26,000 applications were handled through the system.

The existing OARS application underwent further upgrading with new and improved features and facilities for the various modules in the OARS and the upgraded OARS was rolled-out on 20^th November 2008.

1. Printing of Policies by Agents
   
   
2. Internet Access Fee for Agents
   

Following the approval of Bank Negara Malaysia, the following supplementary rules on payments to agents were implemented with effect from 1^st September 2008:-

1. Printing of Policies by Agents
   Agents are allowed to be reimbursed by insurers the cost of policy printing not exceeding RM5.00 per policy (which is inclusive of all consumables, stationery and labour i.e. all related works done on data-entry) and is applicable to all new and renewal policies.
   
   
2. Internet Access Fee for Agents
   Internet access fee not exceeding RM100.00 per month is allowed to be paid by insurers to their agents.
   
   

Website Advertisement by Agents
With advancements in information technology (IT), it is recognized that agents may wish to promote and advertise the products and services offered by their agency through internet websites.

To ensure that the interest of the general public and insurers are protected, a set of guidelines covering the responsibilities of agents in respect of any advertisements placed by Registered Agents through any websites in the internet on any insurance-related products and/or services offered by the Agents (including parties exempted from registration in the Second Schedule) was implemented from 13^th November 2008.

Guidelines on CBC Requirements
To further strengthen agents compliance with the Guidelines on CBC Requirements, the rules on Suspension and Termination for Non-Compliance with the CBC Requirement were revised as follows from 1^st October, 2008:-

1. the suspension penalty would be applicable on per agent basis i.e suspension would apply to both the Principals if an agent has breached the CBC Requirements for any 3 reporting quarters within a two-calendar year period. (Previously the suspension penalty was applicable only on the Principal whose agent(s) had breached the CBC Requirements for 3 reporting quarters).
   
   

2. upon expiry of the suspension and if the same agent is again in breach of the CBC Requirements for any subsequent reporting quarter with any one Principal, the agent's certificate of registration would be cancelled and the agent barred from registration for 12 months for both Principals.

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