IRDAI (Insurance Regulatory and Development Authority of India)
IRDAI (Insurance Regulatory and Development Authority of India) set up as an autonomous body under IRDA Act, 1999 an Act of Parliament passed by the Government of India.
IRDA Act, 1999 spells out the mission of IRDAI as:
"to protect the interests of the policyholders, to regulate, promote and ensure orderly growth of the insurance industry and for matters connected therewith or incidental thereto"
1991: At the time when Narsimha Rao was the Prime Minister of India, the Government of India begins the economic reforms
1993: Committee on Reforms in the Insurance Sector headed by Mr. R. N. Malhotra, (Retired Governor, Reserve Bank of India) set up to recommend reforms.
1994: The Malhotra Committee recommends certain reforms having studied the sector and hearing out the stakeholders Below are some recommended reforms,
Private sector companies should be allowed to promote insurance companies
Foreign promoters should also be allowed
Government to vest its regulatory powers on an independent regulatory body answerable to Parliament
Functions and Duties of IRDAI
The duties, powers, and functions of IRDAI are defined under Section 14 of the IRDA Act, 1999:
Registering and regulating insurance companies
Protecting policyholders’ interests
To specify the qualifications, the code of conduct, and training for intermediaries and individual agents.
Promoting proficiency in the conduct of every line of insurance business.
Promoting professional organizations in insurance
Regulating and overseeing premium rates and terms of non-life insurance covers.
Inspecting and investigating insurers, intermediaries, Corporate Agencies, and Agents.
Specifying financial reporting norms of insurance companies
Setting up a margin of solvency for insurance companies
Regulating investment of policyholders’ funds by insurance companies
Ensuring the coverage of insurance in rural areas.
Supervising the Tariff Advisory Committee.