Page 50 - Insurance Times August 2021

Circular

IRDAI Circular

Insurance Regulatory and Development “Requirement of Resident Indian citizenship for
Authority of India (Indian Insurance Directors, Key Management Persons, etc.
5A. In an Indian Insurance Company having foreign
Companies) (Amendment) Regulations,
investment, —
2021 (a) a majority of its directors,

IRDAI/ Reg/6/178 /2021 (b) a majority of its Key Management Persons, and
7th July, 2021 (c) at least one among the chairperson of its Board,
its managing director and its Chief Executive
In exercise of the powers conferred by clauses (a), (db) and Officer, shall be Resident Indian Citizens.
(zd) of sub-section 2 of section 114A read with Section 3 and
6A of the Insurance Act, 1938 (4 of 1938) and sections 14 Explanation: For the purpose of this regulation, the
and 26 of the Insurance Regulatory and Development expression “Resident Indian Citizen” shall have the same
Authority Act, 1999 (41 of 1999), the Authority hereby meaning as assigned to it in clause (o) of sub-rule (1) of rule
makes the following regulations, namely: - 2 of Indian Insurance Companies (Foreign Investment) Rules,
2015.
Objective: The objective of these regulations is to harmonise
the provisions of various regulations applicable to insurance Requirements for foreign investment exceeding forty-
companies with Insurance (Amendment) Act, 2021 read nine percent
with Indian Insurance Companies (Foreign Investment) Rules, 5B. In an Indian Insurance Company having foreign
2015 by amending the corresponding regulations which are investment exceeding forty-nine per cent. ,—
mentioned herein. (a) for a financial year for which dividend is paid on
1. Short Title and commencement: equity shares and for which at any time the solvency
i. These regulations may be called the Insurance margin is less than 1.2 times the control level of
Regulatory and Development Authority of India solvency, not less than fifty percent of the net profit
(Indian Insurance Companies) (Amendment) for the financial year shall be retained in general
Regulations, 2021. reserve; and
ii. These Regulations shall come into force on the date (b) not less than fifty per cent of its directors shall be
of their publication in the Official Gazette. independent directors, unless the chairperson of its
Board is an independent director, in which case at
CHAPTER I least one-third of its Board shall comprise of
Amendment to Insurance Regulatory and independent directors.”.
Development Authority (Registration of Indian 3. In Regulation 10,
Insurance Companies) Regulations, 2000 a. In clause (e) of sub-regulation (2), the words “forty-
2. After regulation 5, the following regulations shall be nine percent” shall be substituted with words
inserted, namely: - “seventy-four percent”.

50 The Insurance Times, August 2021