III IC-14 flashcards

32 cards. Read the term and the definition here. The deck at the top of this page is optional.

Union List Entry 47

Entry 47 of the Union List in the Seventh Schedule gives Parliament exclusive power to legislate on insurance, which is why central statutes such as the Insurance Act govern the sector.

IRDAI

The Insurance Regulatory and Development Authority of India is the statutory apex regulator created by the IRDA Act, 1999 to regulate, promote and ensure orderly growth of the insurance sector.

Insurance Laws Amendment Act 2015

A central amendment that changed the Insurance Act, IRDA Act, LIC Act and GIC Act, strengthening policyholder protection, penalties and enabling higher foreign investment in insurers.

FDI limit in insurance

The Insurance (Amendment) Act, 2021 raised the foreign direct investment limit in Indian insurance companies from 49% to 74%, subject to Indian ownership and control conditions.

Section 64VB

Section 64VB of the Insurance Act, 1938 prohibits an insurer from assuming risk unless the premium is received in advance or is guaranteed, making premium payment a condition precedent to cover.

Section 45 life policy

Under Section 45 of the Insurance Act, a life insurance policy cannot be called in question after three years on grounds of misstatement or suppression, except in cases of fraud.

Section 41 rebates

Section 41 of the Insurance Act, 1938 prohibits insurers, agents and intermediaries from offering rebates of premium or commission as an inducement to take or renew a policy.

Minimum insurer capital

The Insurance Act requires minimum paid-up capital of ₹100 crore for life and general insurers and ₹200 crore for reinsurers, unless IRDAI prescribes a higher amount.

IRDA Act Section 14

Section 14 of the IRDA Act, 1999 lists IRDAI's functions, including registering insurers, regulating investments, specifying conduct standards and protecting policyholders' interests.

Section 114A regulations

Section 114A of the Insurance Act, 1938 empowers IRDAI to make regulations consistent with the Act to carry out its regulatory functions and implement insurance law.

PPI Regulations 2017

The IRDAI (Protection of Policyholders' Interests) Regulations, 2017 set standards for proposal disclosure, policy documents, claim settlement and grievance redressal by insurers.

Insurance Products Regulations 2024

IRDAI's 2024 product regulations govern design, approval and file-and-use procedures for insurance products, requiring fair terms and clear disclosure to policyholders.

LIC Act 1956

The Life Insurance Corporation Act, 1956 nationalised life insurance in India and created LIC as a statutory corporation owned by the Central Government.

GIC Act 1972

The General Insurance Corporation Act, 1972 nationalised general insurance and established GIC along with four subsidiaries to carry on non-life insurance business.

LIC capital

Under the LIC Act, 1956, LIC's authorised and paid-up capital is ₹5 crore, fully subscribed by the Government of India, which owns the corporation.

GIC Re

GIC Re, or General Insurance Corporation of India, is the national reinsurer registered with IRDAI and governed by the GIC Act, 1972 and insurance regulations.

Marine Insurance Act 1963

The Marine Insurance Act, 1963 codifies Indian marine insurance law, covering insurable interest, utmost good faith, warranties, losses and abandonment of insured property.

Section 146 Motor Vehicles Act

Section 146 of the Motor Vehicles Act, 1988 requires every motor vehicle used in a public place to have third-party insurance, and driving without it attracts penalties.

No-fault compensation

Under Section 164 of the Motor Vehicles Act, 1988, no-fault compensation is ₹5 lakh for death and ₹2.5 lakh for grievous hurt, without proving negligence.

Consumer Protection Act 2019

The Consumer Protection Act, 2019 treats insurance as a service and allows policyholders to complain against deficiency in service before district, state or national commissions.

Insurance broker

An insurance broker is an IRDAI-licensed intermediary who advises clients and places their insurance with insurers for a fee, acting as the client's representative.

Corporate agent

A corporate agent is a company, bank or firm licensed by IRDAI to solicit and service insurance business for one or more insurers under prescribed conditions.

Web aggregator

A web aggregator is an IRDAI-registered online intermediary that displays and compares insurance products of different insurers and facilitates customer enquiries or purchases.

Section 42 agent licence

Section 42 of the Insurance Act, 1938 requires insurance agents to hold a licence, satisfy qualifications and training, and comply with IRDAI's appointment and conduct rules.

PMLA reporting entity

Under the Prevention of Money Laundering Act, 2002, insurers are reporting entities required to conduct KYC, maintain records and report suspicious transactions to FIU-IND.

Suspicious Transaction Report

An STR is a report filed with FIU-IND by an insurer when it suspects that a transaction may involve proceeds of crime or terrorist financing.

Fraud Monitoring Framework

IRDAI's fraud monitoring framework requires insurers to establish a fraud monitoring committee, assess fraud risks and report detected frauds to the regulator.

Fit and proper criteria

Fit and proper criteria are IRDAI standards used to assess the integrity, competence and financial soundness of insurers' directors, key management persons and statutory auditors.

Insurance Ombudsman

The Insurance Ombudsman is a free grievance redressal forum under the Insurance Ombudsman Rules, 2017 that conciliates or passes awards on complaints against insurers.

Ombudsman award limit

Under the Insurance Ombudsman Rules, 2017, an Ombudsman award cannot exceed ₹30 lakh per complaint, and the award is binding on the insurer.

Free look period

A free look period of 30 days lets a policyholder return a newly issued life insurance policy and receive a refund after proportionate risk premium and expenses are deducted.

Grievance Redressal Officer

An insurer must appoint a Grievance Redressal Officer who receives and resolves policyholder complaints within 14 days under IRDAI's policyholder protection regulations.