Insurance Regulatory and Development Authority (IRDA) was set up as autonomous body under the IRDA Act, 1999. IRDA’s Mission is to protect the interests of policyholders and to regulate and develop the insurance industry. It has its headquarters at Hyderabad, Telangana where it shifted from Delhi in 2001.
Insurance Regulatory and Development Authority (IRDA) has been renamed as ‘Insurance Regulatory and Development Authority of India’ after the promulgation of Insurance Laws (Amendment) Ordinance, 2014, by the President of India on December 26, 2014.
The Authority is a ten member team consisting of
- a Chairman;
- five whole-time members;
- four part-time members,
All are appointed by the Government of India.
Functions and Duties of IRDAI
Section 14 of the IRDA Act, 1999 lays down the following duties, powers and functions of IRDA.
- Registering and regulating insurance companies
- Protecting policyholders’ interests
- Licensing and establishing norms for insurance intermediaries
- Promoting professional organisations in insurance
- Regulating and overseeing premium rates and terms of non-life insurance covers
- Specifying financial reporting norms of insurance companies
- Regulating investment of policyholders’ funds by insurance companies
- Ensuring the maintenance of solvency margin by insurance companies
- Ensuring insurance coverage in rural areas and of vulnerable sections of society
Objectives of IRDAI
- To provide policyholders with a secure and fair policies;
- To bring about speedy and orderly growth of the insurance industry, for the benefit of the common man, and to provide long term funds for accelerating growth of the economy;
- To ensure speedy settlement of genuine claims, to prevent insurance frauds and provide an effective grievance redressal mechanism;
- To provide a reliable management information system to enforce high standards of financial soundness amongst market players.
- The institution of Insurance Ombudsman was created by a Government of India Notification dated 11th November, 1998 with the purpose of quick disposal of the grievances of the insured customers and to mitigate their problems involved in redressal of those grievances.
- Ombudsman are drawn from Insurance Industry, Civil Services and Judicial Services.
- An insurance Ombudsman is appointed for a term of three years or till the incumbent attains the age of sixty five years, whichever is earlier.
- Re-appointment is not permitted.