IRDA issues trade logo norms for insurers

India Infoline News Service | Mumbai |

The insurers have been asked to disclose that the trade logo belongs to the particular company and is used by the concerned insurance company.

The Insurance Regulatory and Development Authority (IRDA) said that where an insurer adopts the trade logo of any of its promoting partners, there shall be a prominent disclosure in all the insurance advertisements.
While adopting the ‘Trade Logo’ of their choice is the business prerogative of the Insurers, keeping in view the risks associated with trade logo and the long term interests of policyholders and insurance business, all Insurers may consider developing a distinct trade logo of their own, IRDA said in a notification on Monday.
Further when insurers use the trade logo of their promoting partners, it is desired that they observe certain risk mitigation norms to ensure that the interests of the policyholders are completely protected.
Where an Insurer uses the trade logo of any of its partners, there shall be in place a written agreement setting forth the underlying terms and conditions. There shall also be a specific caveat that the agreements entered shall be subject to the jurisdictions of Indian courts, it added.
The insurers have been asked to disclose that the trade logo belongs to the particular company and is used by the concerned insurance company.
The parties to the agreement shall specify the consideration, leaving no scope for any arbitrary payments. Where the consideration is not mentioned as an absolute amount, but referred to as a percentage of any variable elements, specific ceiling in absolute amount shall be mentioned leaving no scope for any disproportionate windfall gains to the other party, IRDA further said.
The consideration agreed shall be reasonable and according to sound business principles.
Where there is no monetary consideration involved, there shall be a specific mention of the same in unambiguous terms.
Any pay-out towards compensation made, on account of alleged damages owing to usage of trade logo of the promoting partner shall be remitted from the Shareholders’ Account.
The agreements entered into in accordance with these guidelines shall be filed with the Authority within 30 days from the effective date of the circular.
Any changes / modifications to the terms and conditions shall also be filed, within 30 days from the date of effecting the changes. The guidelines will come into force with effect from 01st October, 2014.
 

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