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ANNUAL REPORT 2007-08

2007 stating the Guidelines on File and Use procedures in respect of general insurance products as detailed in the Authority’s circular no. 021/IRDA/F&U/Sep-06 dated 28th September 2006 will continue to apply and insurers shall continue to file the rates and terms that they wish to offer for various products including the products covered by the erstwhile tariffs. The CEOs assured the Authority that the high standards of underwriting and market conduct will be maintained by all insurers even after the price controls are removed. On the basis of these assurances, the Authority decided the following:

1.

Except for Motor Third Party risks, for all other new insurances and renewals effective on or after January 1, 2008 , insurers shall be free to quote rates of premium in accordance with the rate schedules and rating guidelines that have been filed with the Authority.

2.

The premium rates for Motor Third Party risks will continue to be regulated by the Authority.

3.

Risks qualifying as large risks under paragraph 19(v) of the circular no. 021/ IRDA/ F&U/ Sep-06 dated September 28, 2006 shall be insured at the rates, terms and conditions and basis of insurance exactly as the rates, terms etc. as developed from the reinsurers with no variation.

4.

Insurers may file a fresh schedule of rates and rating guidelines with the Authority or may maintain the schedules and rating guidelines that have already been filed.

5.

The requirements of the circular no. 021/IRDA/F&U/ Sep-06 dated September 2006 with regard to the filing of products and rates schedules and rating guides and manuals shall continue to apply as amended from time to time.

6.

The Authority will accept the rate schedules and rating guides as filed by the insurer on the stipulation that these are in compliance with the underwriting policy as approved by the respective Boards of Directors and on the condition that they are designed so as to produce an operating ratio [incurred claims plus commission and expenses of management] not exceeding 100 per

53

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insurance products of which 13 are individual products and the remaining 13 are group micro-products.

The Authority had issued a Circular in December dated 18,

Private

79

341

2

418

LIC

1232

2934

-

4166

Total

1311

3275

2

4584

Further, on October 15, 2007 – Circular No. 42/IRDA/Agency/ OCT/2007 was issued informing amount the reduction inAgent Training Hours to Insurers.

IRDA (Licensing of Corporate Agents) (Amendment) Regulations, 2007.

TABLE 42 MICRO-INSURANCE AGENTS – LIFE INSURERS

With the notification of IRDA (Micro-insurance) Regulations 2005 by the Authority, there has been a steady growth in the design of products catering to the needs of the poor. The flexibilities provided in the Regulations allow the insurers for composite covers or package products. This has generated a trend with the insurance companies offering already approved general products as Micro-insurance products with the approval of the Authority if the sum assured for the product is within the range prescribed for Micro-insurance.

During the year following regulation was notified on October 9, 2007:

Insurer

As on

April 1, 2007

Additions

Corporate Agents

Deletions

As on

March 31, 2008

IRDA (Licensing of Insurance Agents) (Amendment) Regulations, 2007.

During the year following regulation was notified on October 9, 2007:

x) Directions, orders and regulations issued by the Authority

Insurance Agents

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