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Unit 7: Insurance Regulatory and Development Authority Act (IRDA Act)

Self Assessment Notes

Fill in the blanks:
5. The IRDA Act received the assent of the ………………………….. of India on 29 December
1999.

6. An Indian ……………………………. company is a company registered under the Companies
Act, 1956.
7. Insurance companies will deposit ` 10 crore as ………………………… deposit before
starting their business.
8. For ………………………………. policies the bonus is linked to the performance of the fund
and is not declared or guaranteed before.

7.4 Provisions of IRDA Act

You must remember the provisions of IRDA Act. To provide for the establishment of an Authority
to protect the interests of holders of insurance policies, to regulate, promote and ensure orderly
growth of the insurance industry and for matters connected therewith or incidental thereto and
further to amend the Insurance Act, 1938, the Life Insurance Corporation Act, 1956 and the
General Insurance Business (Nationalisation) Act, 1972.
Be it enacted by Parliament in Fiftieth Year of Republic of India as follows:–

7.4.1 Chapter I – Preliminary

1. Short Title, Extent and Commencement - (1) This Act may be called the Insurance Regulatory
and Development Authority Act, 1999.
(2) It extends to the whole of India.
(3) It shall come into force on such date as the Central Government may, by notification in the
Official Gazette, appoint:
Provided that different dates may be appointed for different provisions of this Act and any
reference in any such provision to the commencement of this Act shall be construed as a reference
to the coming into force of that provision.

2. Definitions - (1) In this Act, unless the context otherwise requires, –
(a) ”appointed day” means the date on which the Authority is established under sub-section
(1) of section 3;

(b) “Authority” means the Insurance Regulatory and Development Authority established
under sub-section (1) of section 3;
(c) “Chairperson” means the Chairperson of the Authority;

(d) “Fund” means the Insurance Regulatory and Development Authority Fund constituted
under sub-section (1) of section 16;
(e) “Interim Insurance Regulatory Authority” means the Insurance Regulatory Authority set
up by the Central Government through Resolution No. 17(2)/94-Ins-V, dated the 23rd
January, 1996;
(f) “intermediary or insurance intermediary” includes insurance brokers, reinsurance brokers,
insurance consultants, surveyors and loss assessors;

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