IRDA is a statutory body which regulates the Insurance Industry in India. It was set up in 2000 and was initially known as Insurance Regulatory Authority and subsequently renamed as Insurance Regulatory and Development Authority. The main objective of setting up IRDA was to promote market efficiency and ensure consumer protection.
It was constituted by a Parliament of India act called Insurance Regulatory and Development Authority Act, 1999 and duly passed by the Government of India.Â
The Headquarters of IRDA is located at Hyderabad and the members of IRDA are appointed by Government of India.
Composition of Authority of IRDA
The Authority is a ten member team ofÂ
- A Chairman and every other whole-time member – 5 years (Maximum age is 60 years).Â
- Five whole-time members (Maximum age is 62 years).
- Four part-time members (not more than 5 years)
The current Chairman of IRDA is Mr.T.S.Vijayan.
Duties and Responsibilities of IRDA
- To regulate, promote and ensure orderly growth of the insurance business and re-insurance business.
- To issue a certificate of registration and powers to renew, modify, withdraw, suspend or cancel the registration.
- Protection of the interests of the policy holders.
- To specify qualifications, code of conduct and practical training for intermediaries.
- To specify the code of conduct for surveyors and loss assessors.
- To promote the efficiency in the conduct of insurance business.
- To promote and regulate the organizations connected with the insurance and re-insurance business.
- Levying fees and other charges for carrying out the purposes of this Act.
- To conduct enquiries and investigations for insurers, intermediaries, insurance intermediaries and other organizations connected with the insurance business.
- To control and regulate the rates, advantages, terms and conditions that may be offered by insurers.
- To specify the form and manner in which books of account shall be maintained.
- To regulate the investment of funds by insurance companies.
To regulate the maintenance of margin of solvency. - Adjudication of disputes between insurers and intermediaries and supervising the functioning of the Tariff Advisory Committee.
- To specify the percentage of premium income of the insurer to finance schemes.
- To specify the percentage of life insurance business and general insurance business to be undertaken by the insurer in the rural or social sector.
Functions of IRDA
- Ensure orderly growth of Insurance industry.
- Protection of interest of policy holders.
- Issue consumer protection guidelines to insurance companies.
- Grant, modify, and suspend license for insurance companies.
- Lay down procedure for accounting policies to be adopted by the Insurance companies.
- Inspect and audit of Insurance companies and other related agencies.
- Regulation of capital adequacy, solvency, and prudential requirements of Insurance business.
- Regulation of product development and their pricing including free pricing of products.
- Promote and regular self regulating organizations in the insurance industry.
- Re-insurance limit monitoring.
- Monitor investments.
- Vetting of accounting standards, transparency requirements, in reporting.
- Ensure the health of the industry by preventing sickness through appropriate action.
- Publish information about the industry.
- Prescribe qualification and training needs of agent.
- Monitor the charges for various services by Insurance companies.
- Regulating intermediaries like;
Agents, Brokers, Surveyors, TPA Health services.
Source IRDA Official Website
