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IRDAI Approved 8 Regulations for Insurance Products, Policyholders

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IRDAI board gives nod to 8 regulations for insurance products, policyholders

The Insurance Regulatory and Development Authority of India (IRDAI) has approved eight principle-based consolidated regulations during its 125th Authority meeting held on 19th March 2024, at IRDAI headquarters in Hyderabad, Telangana.

  • These rules cover important areas like protecting policyholders, serving rural and social needs, managing electronic insurance markets, foreign reinsurance branches, registration, finance, investments, and corporate governance.
  • They aim to make the Indian insurance industry more efficient and effective, moving closer to the goal of providing insurance to everyone by 2047.

Regulations approved by IRDAI:

IRDAI (Rural, Social Sector and Motor Third Party Obligations) Regulations, 2024:

It merges two regulations concerning insurers’ minimum business commitments in rural, social sector, and motor third-party sectors under the Insurance Act, 1938.

  • Changes include measuring rural obligations by Gram Panchayat, extending social sector coverage to scheme cardholders and beneficiaries, and measuring Motor Third Party Obligations by insurance renewal for goods carrying vehicles, passenger carrying vehicles, and tractors.

IRDAI (Bima Sugam – Insurance Electronic Marketplace) Regulations, 2024:The IRDAI (Bima Sugam – Insurance Electronic Marketplace) Regulations, 2024, aims to establish a Digital Public Infrastructure named Bima Sugam towards universalization and democratization of insurance as well as empowering and safeguarding policyholders’ interests.

About Bima Sugam:

i.Bima Sugam functions like an online marketplace for insurance, offering both life and non-life policies from various companies.

ii.It streamlines the insurance process, from purchasing policies to renewals, claims, and grievance redressal, providing a seamless digital experience for policyholders.

iii.Serving as a central hub, Bima Sugam enables customers, intermediaries, and agents to access and transact with multiple insurers easily.

iv.Unlike traditional methods involving paperwork and physical documents, Bima Sugam digitizes the entire insurance process.

IRDAI (Registration, Capital Structure, Transfer of Shares and Amalgamation of Insurers) Regulations, 2024

It combines seven regulations into one framework. Its goal is to boost the insurance sector’s growth by simplifying processes like insurer registration, share transfer, capital structure, amalgamation, and stock exchange listing. These streamlined rules aim to make insurance business easier, fostering smoother operations and sectoral expansion.

IRDAI (Corporate Governance for Insurers) Regulations, 2024

It establishes a robust governance framework for insurers. They define roles and responsibilities of the board and management, prioritizing transparency, accountability, and ethical conduct.

  • These are the first formal regulations highlighting the importance of governance in insurance.
  • The regulations aim to enhance trust and confidence among stakeholders.

IRDAI (Insurance Products) Regulations, 2024

It consolidates six regulations into a single framework. It is aimed at enabling insurers to swiftly adapt to market demands, enhancing business ease, and increasing insurance penetration.

  • It will ensure insurers adopt sound management practices for oversight and due diligence.
  • It encourage the development of innovative insurance products catering to various societal segments.

IRDAI (Registration and Operations of Foreign Reinsurers Branches & Lloyd’s India) Regulations, 2024

It merges two regulations. It aims to systematically develop the reinsurance sector in India by promoting orderly growth and harmonizing legal and regulatory frameworks.

  • It streamlines operations of entities engaged in reinsurance, and promote transparency and stability, creating a conducive environment for sector growth.

IRDAI (Actuarial, Finance and Investment Functions of Insurers) Regulations, 2024

It merges nine regulations into one framework. They aim to improve the efficiency and responsiveness of insurers’ actuarial, finance, and investment functions. They also stress the importance of preparing and reporting regulatory returns accurately and transparently to assess insurers’ status, thereby benefiting policyholders and facilitating smoother operations in the insurance sector.

IRDAI (Protection of Policyholders’ Interests and Allied Matters of Insurers) Regulations, 2024

It merges eight regulations into one cohesive framework. They focus on ensuring fair treatment of prospects during insurance policy solicitation and sale, as well as safeguarding policyholders’ interests throughout their engagement with insurers and distribution channels.

  • It promotes prudent risk management practices related to outsourcing activities and prioritize policyholders’ interests in the opening or closing of insurers’ business locations, both domestically and internationally.

Galaxy Health gets nod to launch Health Insurance Business

During the meeting, IRDAI also granted certificate of registration (CoR) to a new health insurer, Galaxy Health and Allied Insurance Company Limited to carry health insurance business in India.

With this, the number of insurers operating in health insurance segment has increased to seven. This marks the sixth registration issued by the regulator in the past year across life, non-life, and health insurance sectors.

Recent Related News:

i.IRDAI has issued guidelines mandating general and health insurance companies to coverAyurveda, Yoga & Naturopathy, Unani, Siddha, Sowa Rigpa and Homoeopathy (AYUSH)treatments in their health insurance policies with effect from 1st April 2024.

ii.IRDAI has granted in-principle approval to Gurugram (Haryana) based Policybazaar Insurance Brokers Private Limited (Policybazaar) to upgrade its license from a direct insurance broker (Life and General) to a composite insurance broker.

About Insurance Regulatory and Development Authority of India (IRDAI):
IRDAI was constituted in 1999 and was incorporated as a statutory body in April, 2000.
Chairperson – Debasish Panda
Headquarters – Hyderabad, Telangana