III IC-14 study guide
III IC-14 · Work through your exam, one topic at a time.
IC 14, Regulations of Insurance Business, is one of the subject papers in the professional examination programme of the Insurance Institute of India (III). It is written for people who need a working knowledge of the statutes and regulators that govern how insurance business is actually transacted in India: insurer and intermediary staff, agents, brokers, surveyors, compliance and audit teams, and candidates working towards III's certificate, diploma and associateship stages. The III IC-14 study guide has 7 sections and about 2,344 words.
01Indian Insurance Legislation and the Regulatory Framework
The exam tests whether you can place any given rule in the correct instrument. Insurance is a Union subject (Entry 47, List I), so Parliament alone legislates on insurance business - there is no state licensing of insurers.
327 words, about 2 min02Insurance Act, 1938, IRDA Act, 1999 and IRDAI Regulations
Section 3 : registration by IRDAI before carrying on insurance business. Section 6 : minimum paid-up equity capital ₹100 crore for life, general and reinsurance.
346 words, about 2 min03Public Sector Insurers: LIC Act, 1956 and GIC Act, 1972
Nationalisation merged 245 Indian and foreign insurers and provident societies into a single corporation with effect from 1 September 1956 . The LIC Act gave the Corporation the exclusive privilege of life insurance business, with capital subscribed by the Government of India, and made it subject to Central Government directions on policy matters.
341 words, about 2 min04Other Statutes Affecting Insurance: Marine Insurance Act, Motor Vehicles Act, Consumer Protection Act
Codifies marine insurance (hull, cargo, freight) along the lines of the English Marine Insurance Act, 1906: insurable interest, utmost good faith, warranties, voyage and deviation, particular and general average, constructive total loss, abandonment, sue and labour and subrogation. It does not govern inland transit, which is general insurance under the Insurance Act.
319 words, about 2 min05Regulation of Insurance Intermediaries and Distribution Channels
IRDAI licenses and regulates each channel separately: Individual agents - licensed and trained, appointed by insurers. Corporate agents - may tie up with up to three life, three general and three health insurers.
318 words, about 2 min06Corporate Governance, Anti-Money Laundering and Fraud Risk Management
IRDAI's Corporate Governance Regulations, 2016 require a board with independent directors, "fit and proper" certification, and mandatory committees: Audit, Risk Management, Investment, Policyholder Protection, and Nomination & Remuneration . Every insurer must appoint an Appointed Actuary and a Chief Risk Officer , maintain a compliance function, and adopt board-approved related-party transaction, whistleblower and internal-controls policies.
330 words, about 2 min07Policyholder Protection, Grievance Redressal and the Insurance Ombudsman
IRDAI's Protection of Policyholders' Interests Regulations, 2017 set the service standards examiners test: Free look period : 15 days from receipt of the policy, 30 days for distance marketing and electronic policies. A Most Important Terms and Conditions document must be supplied with the policy.
363 words, about 2 min