Page 9 - Insurance Times July 2022

mission in Jaipur, which ruled in favour dend for the preceding two years, ex-
IRDAI sets up committees
of the consumer. cept in cases where the bank is a pro-
to suggest industry over- moter entity of the insurer. AT-1 bonds
The apex consumer commission said
haul offer higher return to the investors, and
suppression of facts in the proposal
presently insurance companies are not
form in this case vitiated the case of To overhaul the insurance sector, the
allowed to invest in such instruments.
the complainant. IRDAI has formed various committees
through the General Insurance Council The committee comprised Anjan Dey,
"The appeal is allowed and the order of
(GIC) to suggest reforms in several ar- Chairman And Managing Director
the state commission is set aside. We
eas of general, reinsurance and life in- (CMD) of Oriental Insurance; Ritesh
also advise the Insurance Regulatory
surance such as regulation, product, Kumar, MD of HDFC ERGO General In-
and Development Authority of lndia
distribution, among others. surance; Anuj Gulati MD of Care Health
(IRDAI) to issue fresh guidelines on the
Insurance; V. Suryanarayanan MD of
conduct and responsibilities of the in- These panels include heads of private
Cholamandalam MS General Insurance;
surance agent when dealing with life and public sector insurance companies,
A. Ramana Rao, General Manager of
insurance policy on the need for full dis- members of IRDAI and representatives
IRDAI; and Y. Srinivasa Rao, Deputy
closure of all diseases suffered by the from the council, said an official.
General Manager at IRDAI.
customer in the proposal form and im-
To overhaul the insurance sector, the
plications of non-disclosure. The pro-
IRDAI has formed various committees
posal form can also be suitably modi- IRDAI reduces solvency
through the General Insurance Council
fied to this effect," the NCDRC said.
to suggest reforms in several areas of margin requirement for
general, reinsurance and life insurance
crop business
PMJJBY: IRDAI cases capi- such as regulation, product, distribu-
IRDAI has reduced the solvency margin
tion, among others.
tal requirement to attract
requirement for general insurers doing
These panels include heads of private
insurers crop business. The decision can free up
and public sector insurance companies,
After the recent hike in the premium a capital of Rs 1,400 crore, which IRDAI
members of IRDAI and representatives
expects will increase the capacity of
rate, theIRDAI relaxed capital require-
from the Council, said an official.
general insurers to underwrite more
ment norms significantly for insurers to
business.
encourage their participation in the
IRDAI working group sug-
government's flagship programme "It is expected that the effect of this re-
Pradhan Mantri Jeevan Jyoti Bima gests relaxing investment laxation will be positive on the Industry
Yojana (PMJJBY). as it will free up the capital, which can
norms for insurers
be utilised for underwriting more busi-
The regulator has reduced the capital
A panel formed to suggest overhaul of ness," the regulator said in a statement.
required to be held by insurers offering
the general insurance industry has rec-
PMJJBY by almost 50 per cent. IRDAI has been relaxing the period of
ommended that insurers relax invest-
admissibility of premiums due from
This move will enable life insurers to ment rules, such as permitting invest-
state governments for solvency pur-
offer more policies under the scheme, ment in Additional Tier-1 (AT-1) bonds of
poses from 180 days to 365 days since
and provide financial security to the
banks, removing the criteria of equity
2017-18. It has now decided to extend
bottom of the pyramid of the Indian investments only in dividend yielding
this relaxation from FY23 onwards until
population through life insurance, companies, and increasing investments
further orders. "This move will improve
IRDAI said in a statement. The easing
in infrastructure sector through banks.
the solvency status of the general in-
of capital requirements by IRDAI will
The panel's report has been submitted surance industry as a whole," it said.
accelerate the penetration of life insur-
to the IRDAI, and is being reviewed by
ance in India and will support the life In a circular, the regulator has stated
the regulator, said an official. The panel
insurers in achieving the target set by that premium receivables related to
included representatives from IRDAI and
the government. The government has state- and central government-spon-
chiefs of non-life insurance companies.
recently hiked the premium rates for sored schemes for all quarters of the FY23
the two flagship schemes, PMJJBY and The committee has suggested allowing and onward to the extent that they are
Pradhan Mantri Suraksha Bima Yojana, insurers to invest in AT-1 perpetual not realised within a period of 365 days
to make these schemes viable. bonds of banks that have declared divi- will be placed with value zero.
The Insurance Times, July 2022 9