Insurance Regulatory & Developmental Authority of India

1. IRDA
(Insurance Regulatory &
Developmental Authority)
Presented By:
RN Ankita Ashok Kadam
PGDHA 2019-20
Roll No. 04
Garware Institute Of Career Education &
Medico-legal Framework

2. INTRODUCTION
The Insurance Regulatory and Development
Authority of India (IRDAI) is an
autonomous, statutory body tasked with regulating
and promoting the insurance and re-
insurance industries in India. It was constituted by
the Insurance Regulatory and Development
Authority Act, 1999, an Act of Parliament passed
by the Government of India. The agency's
headquarters are in Hyderabad, Telangana, where it
moved from Delhi in 2001.

3. INSURANCE
• Insurance in law and economics is a form of risk
management primarily used to hedge against the risk of
contingent loss.
• Insurance is defined as the equitable transfer of the risk of
a potential loss from one entity to another, in exchange to
premium.
• INSURER- An insurer, or insurance carrier, is a company
selling the insurance.
• INSURED- The insured, or policyholder, is the person or
entity buying the insurance policy.

4. INSURANCE EVOLUTION
 1818-Oriental Life Insurance Company-1st Insurance company.
 1870-Bombay Mutual life Assurance society-1st life insurance company.
 1912-The Indian life assurance Companies act enacted the 1st law to
regulate the Life insurance Business
 1928-The Indian life assurance Companies act enacted to enable the
Government to collect statistical information about both Life and Non-Life
insurance businesses.
 1938-Earlier legislation consolidated and amended the Insurance act with
the objective of protecting the interests of the insuring public.
 1956-245 Indian and foreign Insurers and provident societies are taken
over by Central Government and Nationalized.
 LIC formed by an act of parliament , viz .LIC act,1956with a capital
contribution of Rs.5 crore from GOI.

5. MISSIONSTATEMENTOFTHEAUTHORITY
• To protect the interest of and secure fair treatment to
policyholders;
• To bring about speedy and orderly growth of the insurance
industry (including annuity and superannuation payments),
for the benefit of the common man, and to provide long term
funds for accelerating growth of the economy;
• To set, promote, monitor and enforce high standards of
integrity, financial soundness, fair dealing and competence of
those it regulates;
• To ensure speedy settlement of genuine claims, to prevent
insurance frauds and other malpractices and put in place
effective grievance redressal machinery;

6. Mission Statement Of The Authority ( Cont.)
• To promote fairness, transparency and orderly conduct in
financial markets dealing with insurance and build a
reliable management information system to enforce high
standards of financial soundness amongst market players;
• To take action where such standards are inadequate or
ineffectively enforced;
• To bring about optimum amount of self-regulation in day-
to-day working of the industry consistent with the
requirements of prudential regulation

7. INSURANCEREGULATORYAND
DEVELOPMENTAUTHORITYACT,1999
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 there to and
further to amdend the Insurance
Act, 1938, the Life Insurance
Corporation Act, 1956 and the
General Insurance
Business(Nationalisation) Act,
1972.

8. 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.

9. DEFINITIONS
In this Act, unless the context otherwise requires, -
• "appointed day" means the date on which the Authority is established
under sub-section (1) of section 3;
• "Authority" means the Insurance Regulatory and Development Authority
established under sub-section (1) of section 3;
• "Chairperson" means the Chairperson of the Authority;
• "Fund" means the Insurance Regulatory and Development Authority
Fund constituted under sub-section (1) of section 16;
• "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;

10. • "intermediary or insurance intermediary" includes insurance
brokers, reinsurance brokers, insurance consultants, surveyors and
loss assessors;
• "member" means a whole time or a part time member of the
Authority and includes the Chairperson;
• "notification" means a notification published in the Official Gazette;
• "prescribed" means prescribed by rules made under this Act;
• "regulations" means the regulations made by the Authority.
Words and expressions used and not defined in this Act but defined in the
Insurance Act, 1938 (4 of 1938) or the Life Insurance Corporation Act,
1956 (31 of 1956) or the General Insurance Business (Nationalization)
Act, 1972 (57 of 1972) shall have the meanings respectively assigned to
Definitions( Cont.)

11. COMPOSITIONOFAUTHORITY
As per the section 4 of IRDAI Act' 1999, Insurance Regulatory and
Development Authority of India (IRDAI, which was constituted by
an act of parliament) specify the composition of Authority
The Authority is a ten member team consisting of
(a) a Chairman;
(b) five whole-time members;
(c) four part-time members,
(all appointed by the Government of India)
At present ( 1 Sept, 2018 ), the authority is chaired by Dr. Subhash C. Khuntia
and its full-time members are Mrs T.L.Alamelu, K.Ganesh, Pournima Gupte,
Praveen Kutumbe and Sujay Banarji.

12. DUTIES,POWERSANDFUNCTIONSOFIRDAI
Section 14 of IRDAI Act, 1999 lays down the duties, powers and functions of
IRDAI..
Subject to the provisions of this Act and any other law for the time being in
force, the Authority shall have the duty to regulate, promote and ensure orderly
growth of the insurance business and re-insurance business.
Without prejudice to the generality of the provisions contained in sub-
section (1), the powers and functions of the Authority shall include, -
• issue to the applicant a certificate of registration, renew, modify, withdraw,
suspend or cancel such registration;
• protection of the interests of the policy holders in matters concerning
assigning of policy, nomination by policy holders, insurable interest,
settlement of insurance claim, surrender value of policy and other terms and
conditions of contracts of insurance;

13. • specifying requisite qualifications, code of conduct and practical training for
intermediary or insurance intermediaries and agents
• specifying the code of conduct for surveyors and loss assessors;
• promoting efficiency in the conduct of insurance business;
• promoting and regulating professional organisations connected with the
insurance and re-insurance business;
• levying fees and other charges for carrying out the purposes of this Act;
• calling for information from, undertaking inspection of, conducting enquiries
and investigations including audit of the insurers, intermediaries, insurance
intermediaries and other organisations connected with the insurance business;
• 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);
Duties, Powers And Functions ( Cont.)

14. • specifying the form and manner in which books of account shall be
maintained and statement of accounts shall be rendered by insurers and
other insurance intermediaries;
• regulating investment of funds by insurance companies;
• regulating maintenance of margin of solvency;
• adjudication of disputes between insurers and intermediaries or
insurance intermediaries;
• supervising the functioning of the Tariff Advisory Committee;
• specifying the percentage of premium income of the insurer to finance
schemes for promoting and regulating professional organisations
referred to in clause (f);
• specifying the percentage of life insurance business and general
insurance business to be undertaken by the insurer in the rural or social
sector; and
• exercising such other powers as may be prescribed
Duties, Powers And Functions ( Cont.)

16. TENUREOFOFFICEOFCHAIRPERSONANDOTHER
MEMBERS
(1) 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:
Provided that no person shall hold office as a Chairperson after he has attained the
age of sixty-five years:
Provided further that no person shall hold office as a whole-time member after he has
attained the age of sixty-two years.
(2) A part-time member shall hold office for a term not exceeding five years from the
date on which he enters upon his office.
(3) Notwithstanding anything contained in sub-section (1) or sub-section (2), a member
may -
(a) relinquish his office by giving in writing to the Central Government
notice of not less than three months; or
(b) be removed from his office in accordance with the provisions of section

17. OBLIGATIONSOFIRDAIUNDERTHERTI
ACT2005
• The RTI ACT, 2005 :- The Government of India has enacted the Right to
Information Act, 2005 which has come into effect from October 13, 2005. The
Right to Information under this Act is meant to give to the citizens of India access
to information under control of public authorities to promote transparency and
accountability in these organizations.
• Obligations of IRDAI :- The Insurance Regulatory and Development Authority
of India (IRDAI) is a public authority as defined in the Right to Information Act,
2005. As such, the Insurance Regulatory and Development Authority of India is
obliged to provide information to members of public in accordance with the
provisions of the said Act. The right to information includes access to the
information which is held by or under the control of any public authority and
includes the right to inspect the work, document, records, taking notes, extracts or
certified copies of documents / records and certified samples of the materials and
obtaining information which is also stored in electronic form.

18. OMBUDSMAN
The institution of Insurance Ombudsman was created by
Government of India Notification dated 11thNovember, 1998
• Purpose is to quick disposal of the grievances of the insured
• The institution helps to generate and sustain the faith and
confidence amongst the consumers and insurers.
The appointment has to be done with the recommendations
of the committee comprising of Chairman, IRDA, Chairman, LIC,
Chairman, GIC and a representative of the Central Government.

19. COMPLAINTSMAYRELATETO
• Any partial or total repudiation of
claims by the insurance companies.
• Dispute with regard to premium paid
or payable in terms of the policy.
• Delay in settlement of claims.
• Non- issuance of any insurance
document to customers after receipt
of premium.

20. CAUTION
IRDA is not involved in any
direct or indirect selling of
insurance and strictly does not
promote any company and its
policy of Insurance selling.
IRDA is a regulatory body to
keep a check on the insurance
issuing companies.