Page 126 - DCOM309_INSURANCE_LAWS_AND_PRACTICES

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

The Insurance Regulatory and Development Authority (IRDA) has notified changes made Notes
to the guidelines on design of life insurance products in the gazette in February 2013. All
existing group products will stand withdrawn from 1 July 2013 and all individual products
from 1 October 2013.

In case of non-participating policies, the return on the policy is disclosed in the beginning
of the policy itself. In both cases, a policyholder should calculate the net return to assess
the total costs.

The IRDA in February 2013 has also issued guidelines to standardize health insurance in
India. Now, all health insurance policies would be renewable for lifetime and will have an
entry age of at least 65 years. All policies except customised ones will be renewable for life
time. Insurers have to settle claims within 30 days after the receipt of all the documents.

The Chairperson and every other whole-time member shall hold office for a term of five
years from the date on which he enters upon his office and shall be eligible for
reappointment:

Control and regulation of the rates, advantages, terms and conditions that may be offered
by insurers in respect of general insurance business not so controlled and regulated by the
Tariff Advisory Committee under section 64U of the Insurance Act, 1938 (4 of 1938);
The accounts of the Authority shall be audited by the Comptroller and Auditor-General of
India at such intervals as may be specified by him and any expenditure incurred in
connection with such audit shall be payable by the Authority to the Comptroller and
Auditor-General.

7.6 Keywords

Appointed Day: It means the date on which the Authority is established under sub-section (1) of
section 3.

Intermediary: Intermediary or insurance intermediary includes insurance brokers, reinsurance
brokers, insurance consultants, surveyors and loss assessors.
Member: Member means a whole time or a part time member of the Authority and includes the
Chairperson.
Notification: Notification means a notification published in the Official Gazette.
Regulations: Regulations mean the regulations made by the Authority.

7.7 Review Questions

1. What is IRDA Act made for?
2. Discuss the history of IRDA Act in detail.
3. Give an overview of IRDA Act in your own words.
4. Discuss the salient features of IRDA Act.
5. Briefly explain the delegation of powers by the concerned authority.

6. Discuss the roles and functions of IRDA.
7. Describe the purpose of establishment of Insurance advisory committee.
8. Give any five definitions mentioned in the IRDA Act.

LOVELY PROFESSIONAL UNIVERSITY 121