Presented By:Presented By:Sai ReddySai ReddySravana KarthikSravana KarthikV.B.RaoV.B.Rao

INTRODUCTION OF IRDACONSTITUTION OF IRDA

MISSION STATEMENT OF IRDAOBJECTIVES OF IRDA

FUNCTIONS, DUTIES AND POWERS OF IRDA

LAWS AND REGULATIONSPROCEDURE OF ISSUE OR RENEWAL OF LICENSE

BY IRDAQUALIFICATION OF THE APPLICANT

In april 1993, the government of India appointed a committee of Reforms in insurance sector with Shri. R.N. Malhotra, a former governor of Reserve Bank Government of India in January 1994.In accordance with the recommendations of the committee, the government set up a regulatory body known as “Insurance Regulatory and Development Authority” and enacted the Act known as Insurance Regulatory and Development Act, 1999.

IRDA consists of:i. A chairmanii. Not more than 5 whole time membersiii. Not more than 4 part time members to be

appointed by central government.

To protect the interest of and secure fair treatment to policyholders.To bring about speedy and orderly growthTo set, promote monitor , and enforce high standards of integrity.To take actions where standards are inadequate or ineffectively enforced.To ensure speedy settlement of insured claims.

MISSION STATEMENT OF IRDAMISSION STATEMENT OF IRDA

i. Take care of the policyholders interest.ii. Open the insurance sector for private sector.

iii. Ensure continued financial soundness and solvency.iv. Regulate insurance and reinsurance companies.

v. Eliminate dishonesty and unhealthy competition.vi. Supervise the activities of intermediaries.

vii. Amend the insurance act 1938 ,the Life Insurance Corporation Act1956, and the General Business

Act1972.

OBJECTIVES OF IRDAOBJECTIVES OF IRDA

To issue certificate of registration.To protect the interests of the policyholders.

To specify requisite qualifications code of conduct and training for insurance

intermediaries and agents.To specify code of conduct for Surveyors/ Loss

Assessors.

FUNCTIONS, DUTIES & POWER OF IRDA

To promote efficiency in the conduct of insurance business.

To supervise the functioning of Tariff Advisory Committee.

To regulate investment of funds by the insurance companies.

To undertake inspection, conduct enquiries and investigations.

Functions Cont...

To specify the percentage of Life and General Insurance business.

To promote and regulate professional organizations connected with the

insurance and reinsurance. To specify the form and manner for maintenance of books of accounts.

Functions Cont…

To prescribe the manner and form in which accounts will be maintained and submitted by insurers and intermediaries.To regulate maintenance of margin of

solvency.

Functions Cont…

Functions Cont…

To levy fees & other charges for carrying out the purposes of this act.

To adjudication of disputes between insurers & intermediaries or insurance intermediaries.

To specify the percentage of premium income of the insurer financial schemes for promoting & regulating professional organization.

Insurance Act, 1938Life Insurance Corporation Act, 1956

Insurance Regulatory and Development Authority Act,1999

Consumer Protection Act, 1986Ombudsman

Income Tax ActMarriage Women’s Property Act, 1874

LAWS AND REGULATIONS

The Insurance Act,1938 came into effect from 1st July 1939, and was amended in1950 and in 1999.

It has the following provisions:Licensing of agents and their remunerations

Probhition of rebatesProtection of policyholder’s interests

Placing the limits on the expenses of insurers use of funds and patterns of investments

Maintaining solvency levels

INSURANCE ACT, 1938

•Constitution of Insurance Association and Insurance Councils and the Tariff Advisory Committee for General Insurance

Till 1999 the Controller of Insurance was responsible for the administration of Insurance Act.

Since 1999, the IRDA has replaced the Controller of Insurance. The Insurance Act vests the IRDA powers to:

Register insurance companies and also cancel their registrations

Insurance Act Cont…

Monitor and certify the soundness of the terms of life insurance business.

Make regulation relating to the conduct of the business of insurance.

Inspect documents of insurerAppoint additional directors

Issue directionsTakeover the management of an insurer and

appoint administrators.

Insurance Act Cont…

Adjudicate on disputes between insurers and intermediaries or between intermediaries.

Decide on disputes relating to settlement of claims of amounts not exceeding Rs.2000.

By the end of December 2006, the IRDA had issued more than 25 regulations and also issued

several guidelines to insurers on a variety of matters.

Insurance Act Cont…

Basis for the establishment of LIC:Members- not more than 16.

One of them being chairman, appointed by Central Government.

Section 30 gave LIC exclusive privilege to transact life insurance business in India and ceased as a

result of the amendments made in 1999.16 insurance companies were registered and had commenced life insurance business till 31.8.2007

LIFE INSURANCE ACT,1956

IRDA is a corporate body which is passed in December 1999

It was establisheda) to protect the interests to holders of insurance

policies, b)to regulate, promote and ensure orderly growth of

the insurance industry.It also sought to amend a) the Insurance Act 1938,

b) the Life Insurance Corporation Act 1956,c) the General Insurance Business Act,1972.

IRDA ACT, 1999

Members –not more than 25It replaces the ‘Controller of Insurance’ to administer the provisions of Insurance Act.

It includes:a)Registration

b)Licensingc)Laying down regulations

for proper conduct of business.

IRDA Act Cont…

A consumer can approach the various forums prescribed under the act for redress, in case he

is not satisfied with the goods and services provided.

Consumer redress forums are established in each district in each state.

CONSUMER PROTECTION ACT,1986

complaints upto the value of

At district level-Rs. 20 lakhAt state level-Rs. 1 crore

The national commission will attend matters beyond state level.

Consumer Protection Cont…

The governing body of the insurance council is authorized by law to appoint ombudsman for the

insurance industry.Function-

to resolve complaints.Acts as counsel and mediator in matters

Complaints may relate to:a)Partial or total repudiation of claims

b)Any dispute regarding premium paid or payable

OMBUDSMAN

Delay in settlement of claimsNon-issue of any insurance documents to

customers after receipts of premium.

Ombudsman Cont…

A complain can be made within one year after the insurer had rejected the representations.

Expected to make the recommendation within one month from the date of receipt of complains

Accepted-the insurer has to comply within 15 days.Not accepted:

it will pass a award in writing stated the amount awarded.Award has to be pass within 3 months.

intimate acceptance-should be within one month by a letter of acceptance to the insurer.

Not intimate the acceptance- award cannot be implemented.

HOW OMBUDSMAN DEALS WITH COMPLAINTS

relief from income tax liabilitiesSum received under a life insurance policy exempted from

income tax subjected to the premium not more than 20% of SA.The income of the assesses is reduced by aggregate amounts

paid towards insurance premiums , up to max. Rs. 1 lakh.Commuted values of pensions are exempt from income tax.

The wealth tax exempts life insurance policies:Premium more than 10 years or more

Less than 10 years- proportionate value is deducted.

INCOME TAX ACT 1961

PROCEDURE Of ISSUE OR RENEWAL OF LICENSE BY IRDA

Application through designate person.

Fees payable by the applicant to the Authority.

Designated Person Grant or Renew

License is Granted or Renewed within period of 3 Months

Reason for refusing

If delayed within 60 days of receipt of the application, inform the applicant for reason.

Yes

NoDelay

Qualifications of the applicant

Population 5,000 or more

Any other place

Pass in 12th Std. or equivalent examination.

Pass in 10th Std. or equivalent examination.

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