THE INSURANCE REGULATORY AND DEVELOPMENT AUTHORITY ACT, 1999 
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ARRANGEMENT OF SECTIONS 
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CHAPTER I 

PRELIMINARY 

SECTIONS 

1.  Short title, extent and commencement. 
2.  Definitions. 

CHAPTER II 

INSURANCE REGULATORY AND DEVELOPMENT AUTHORITY 

3.  Establishment and incorporation of Authority. 
4.  Composition of Authority. 
5.  Tenure of office of Chairperson and other members. 
6.  Removal from office. 
7.  Salary and allowances of Chairperson and members. 
8.  Bar on future employment of members. 
9.  Administrative powers of Chairperson. 
10.  Meetings of Authority. 
11.  Vacancies, etc., not to invalidate proceedings of Authority. 
12.  Officers and employees of Authority. 

TRANSFER OF ASSETS, LIABILITIES, ETC., OF INTERIM INSURANCE REGULATORY AUTHORITY 

13.  Transfer of assets, liabilities, etc., of Interim Insurance Regulatory Authority. 

CHAPTER III 

CHAPTER IV 

DUTIES, POWERS AND FUNCTIONS OF AUTHORITY 

14.  Duties, powers and functions of Authority. 

CHAPTER V 

FINANCE, ACCOUNTS AND AUDIT 

15.  Grants by Central Government. 
16.  Constitution of Fund. 
17.  Accounts and audit. 

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SECTIONS 

CHAPTER VI 

MISCELLANEOUS 

18.  Power of Central Government to issued directions. 
19.  Power of Central Government to supersede Authority. 
20.  Furnishing of returns, etc., to Central Government. 
21.  Chairperson, members, officers and other employees of Authority to be public servants. 
22.  Protection of action taken in good faith. 
23.  Delegation of powers. 
23A. Powers of Authority not to apply to International Financial Services Centre. 
24.  Power to make rules. 
25.  Establishment of Insurance Advisory Committee. 
26.  Power to make regulations. 
27.  Rules and regulations to be laid before Parliament. 
28.  Application of other laws not barred. 
29.  Power to remove difficulties. 
30.  Amendment of Act 4 of 1938. 
31.  Amendment of Act 31 of 1956. 
32.  Amendment of Act 57 of 1972. 
THE FIRST SCHEDULE. 
THE SECOND SCHEDULE. 
THE THIRD SCHEDULE. 

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THE INSURANCE REGULATORY AND DEVELOPMENT AUTHORITY 
ACT, 1999 

ACT NO. 41 OF 1999 

An  Act  to  provide  for  the  establishment  of  an  Authority  to  protect  the  interests  of  holders  of 
insurance policies, to regulate, promote and ensure orderly growth of the insurance industry 
and for matters connected therewith or incidental thereto and further to amend the Insurance 
Act,  1938,  the  Life  Insurance  Corporation  Act,  1956  and  the  General  Insurance  Business 
(Nationalisation) Act, 1972. 

BE it enacted by Parliament in the Fiftieth Year of the Republic of India as follows:— 

[29th December, 1999.]  

CHAPTER I 

PRELIMINARY 

1.  Short  title,  extent  and commencement.—(1)  This  Act  may  be  called the  Insurance  Regulatory 

and Development Authority Act, 1999. 

(2) It extends to the whole of India. 
(3)  It  shall  come  into  force  on  such  date1  as  the  Central  Government  may,  by  notification  in  the 

Official Gazette, appoint: 

Provided that different dates may be appointed for different provisions of this Act and any reference 
in any such provision to the commencement of this Act shall be construed as a reference to the coming 
into force of that provision. 

2. Definitions.—(1) In this Act, unless the context otherwise requires,— 

 (a) “appointed day” means the date on which the Authority is established under sub-section (1) 

of section 3; 

(b)  “Authority”  means  the  Insurance  Regulatory  and  Development  Authority  2[of  India] 

established under sub-section (1) of section 3; 

(c) “Chairperson” means the Chairperson of the Authority; 

(d) “Fund” means the Insurance Regulatory and Development Authority Fund constituted under 

sub-section (1) of section 16; 

(e) “Interim Insurance Regulatory Authority” means the Insurance Regulatory Authority set up by 

the Central Government through Resolution No. 17(2)/94-Ins.-V, dated the 23rd January, 1996; 

3[(f) “intermediary” or “insurance intermediary” includes insurance brokers, re-insurance brokers, 
insurance  consultants,  corporate  agents,  third  party  administrator,  surveyors  and  loss  assessors  and 
such other entities, as may be notified by the Authority from time to time;] 

(g)  “member”  means  a  whole-time  or  a  part-time  member  of  the  Authority  and  includes  the 

Chairperson; 

(h) “notification” means a notification published in the Official Gazette; 

(i) “prescribed” means prescribed by rules made under this Act; 

(j) “regulations” means the regulations made by the Authority. 

1.19th  April,  2000,  vide  notification  No.  S.O.  397(E),  dated  19th  April,  2000,  see  Gazette  of  India,  Extraordinary,  Part  II,  

sec. 3(ii). 

2. Ins. by Act 5 of 2015, s. 105 (w.e.f. 26-12-2014). 
3. Subs. by s. 105, ibid., for clause (f) (w.e.f. 26-12-2014). 

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(2) Words and expressions used and not defined in this Act but defined in the Insurance Act, 1938 
(4 of 1938) or the Life Insurance Corporation Act, 1956 (31 of 1956) or the General Insurance Business 
(Nationalisation) Act, 1972 (57 of 1972) shall have the meanings respectively assigned to them in those 
Acts. 

CHAPTER II 

INSURANCE REGULATORY AND DEVELOPMENT AUTHORITY 

3. Establishment and incorporation of Authority.—(1) With effect from such date as the Central 
Government  may,  by  notification,  appoint,  there  shall  be  established,  for  the  purposes  of  this  Act,  an 
Authority to be called “the Insurance Regulatory and Development Authority 1[of India]”.  

(2) The Authority shall be a body corporate by the name aforesaid having perpetual succession and a 
common seal with power, subject to the provisions of this Act, to acquire, hold and dispose of property, 
both movable and immovable, and to contract and shall, by the said name, sue or be sued. 

(3) The  head  office  of  the  Authority  shall  be  at  such  place  as  the  Central  Government  may  decide 

from time to time.  

(4) The Authority may establish offices at other places in India. 

4. Composition of Authority.—The Authority shall consist of the following members, namely:—  

(a) a Chairperson;  

(b) not more than five whole-time members; 

(c) not more than four part-time members, 

to be appointed by the Central Government from amongst persons of ability, integrity and standing who 
have knowledge or experience in life insurance, general insurance, actuarial science, finance, economics, 
law,  accountancy,  administration  or  any  other  discipline  which  would,  in  the  opinion  of  the  Central 
Government, be useful to the Authority:  

Provided  that  the  Central  Government  shall,  while  appointing  the  Chairperson  and  the  whole-time 
members,  ensure  that  at  least  one  person  each  is  a  person  having  knowledge  or  experience  in  life 
insurance, general insurance or actuarial science, respectively. 

5.  Tenure  of  office  of  Chairperson  and  other  members.—(1)  The  Chairperson  and  every  other 
whole-time member shall hold office for a term of five years from the date on which he enters upon his 
office and shall be eligible for reappointment: 

Provided that no person shall hold office as a Chairperson after he has attained the age of sixty-five 

years:  

Provided further that no person shall hold office as a whole-time member after he has attained the age 

of sixty-two years. 

(2) A part-time member shall hold office for a term not exceeding five years from the date on which 

he enters upon his office. 

(3) Notwithstanding anything contained in sub-section (1) or sub-section (2), a member may— 

(a) relinquish his office by giving in writing to the Central Government notice of not less than 

three months; or 

(b) be removed from his office in accordance with the provisions of section 6.  

6. Removal from office.—(1) The Central Government may remove from office any member who— 

(a) is, or at any time has been, adjudged as an insolvent; or 

(b) has become physically or mentally incapable of acting as a member; or 

1. Ins. by Act 5 of 2015, s. 106 (w.e.f. 26-12-2014). 

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(c) has been convicted of any offence which, in the opinion of the Central Government, involves 

moral turpitude; or 

(d) has acquired such financial or other interest as is likely to affect prejudicially his functions as 

a member; or  

(e)  has  so  abused  his  position  as  to  render  his  continuation  in  office  detrimental  to  the  public 

interest. 

(2) No such member shall be removed under clause (d) or clause (e) of sub-section (1) unless he has 

been given a reasonable opportunity of being heard in the matter. 

7. Salary and allowances of Chairperson and members.—(1) The salary and allowances payable 
to, and other terms and conditions of service of, the members other than part-time members shall be such 
as may be prescribed. 

(2) The part-time members shall receive such allowances as may be prescribed. 

(3)  The  salary,  allowances  and  other  conditions  of  service  of  a  member  shall  not  be  varied  to  his 

disadvantage after appointment.  

8.  Bar  on future  employment  of members.—The Chairperson  and  the  whole-time  members  shall 
not, for a period of two years from the date on which they cease to hold office as such, except with the 
previous approval of the Central Government, accept— 

(a) any employment either under the Central Government or under any State Government; or 

(b) any appointment in any company in the insurance sector. 

9.  Administrative  powers  of  Chairperson.—The  Chairperson  shall  have  the  powers  of  general 

superintendence and direction in respect of all administrative matters of the Authority. 

10. Meetings of Authority.—(1) The Authority shall meet at such time and places and shall observe 
such rules and procedures in regard to transaction of business at its meetings (including quorum at such 
meetings) as may be determined by the regulations. 

(2) The Chairperson, or if for any reason he is unable to attend a meeting of the Authority, any other 
member  chosen  by  the  members  present  from  amongst  themselves  at  the  meeting  shall  preside  at  the 
meeting. 

(3) All questions which come up before any meeting of the Authority shall be decided by a majority 
of votes by the members present and voting, and in the event of an equality of votes, the Chairperson, or 
in his absence, the person presiding shall have a second or casting vote. 

(4) The Authority may make regulations for the transaction of business at its meetings. 

11.  Vacancies,  etc.,  not  to  invalidate  proceedings  of  Authority.—No  act  or  proceeding  of  the 

Authority shall be invalid merely by reason of— 

(a) any vacancy in, or any defect in the constitution of, the Authority; or 

(b) any defect in the appointment of a person acting as a member of the Authority; or 

(c) any irregularity in the procedure of the Authority not affecting the merits of the case. 

12. Officers and employees of Authority.—(1) The Authority may appoint officers and such other 

employees as it considers necessary for the efficient discharge of its functions under this Act. 

(2)  The  terms  and  other  conditions  of  service  of  officers  and  other  employees  of  the  Authority 

appointed under sub-section (1) shall be governed by the regulations made under this Act. 

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CHAPTER III 

TRANSFER OF ASSETS, LIABILITIES, ETC., OF INTERIM INSURANCE REGULATORY AUTHORITY 

13.  Transfer  of  assets,  liabilities,  etc.,  of  Interim  Insurance  Regulatory  Authority.—On  the 

appointed day,— 

(a)  all  the  assets  and  liabilities  of  the  Interim  Insurance  Regulatory  Authority  shall  stand 

transferred to, and vested in, the Authority. 

Explanation.—The  assets  of  the  Interim  Insurance  Regulatory  Authority  shall  be  deemed  to 
include  all  rights  and  powers,  and  all  properties,  whether  movable  or  immovable,  including,  in 
particular,  cash  balances,  deposits  and  all  other  interests  and  rights  in,  or  arising  out  of,  such 
properties as may be in the possession of the Interim Insurance Regulatory Authority and all books of 
account and other documents relating to the same; and liabilities shall be deemed to include all debts, 
liabilities and obligations of whatever kind; 

(b) without prejudice to the provisions of clause (a), all debts, obligations and liabilities incurred, 
all contracts entered into and all matters and things engaged to be done by, with or for the Interim 
Insurance Regulatory Authority immediately before that day, for or in connection with the purpose of 
the said Regulatory Authority, shall be deemed to have been incurred, entered into or engaged to be 
done by, with or for, the Authority; 

(c) all sums of money due to the Interim Insurance Regulatory Authority immediately before that 

day shall be deemed to be due to the Authority; and 

(d)  all  suits  and  other  legal  proceedings  instituted  or  which  could  have  been  instituted  by  or 
against the Interim Insurance Regulatory Authority immediately before that day may be continued or 
may be instituted by or against the Authority. 

CHAPTER IV 

DUTIES, POWERS AND FUNCTIONS OF AUTHORITY 

14. Duties, powers and functions of Authority.—(1) Subject to the provisions of this Act and any 
other law for the time being in force, the Authority shall have the duty to regulate, promote and ensure 
orderly growth of the insurance business and re-insurance business. 

(2) Without prejudice to the generality of the provisions contained in sub-section (1), the powers and 

functions of the Authority shall include,— 

(a) issue to the applicant a certificate of registration, renew, modify, withdraw, suspend or cancel 

such registration; 

(b)  protection  of  the  interests  of  the  policy-holders  in  matters  concerning  assigning  of  policy, 
nomination  by  policy-holders,  insurable  interest,  settlement  of  insurance  claim,  surrender  value  of 
policy and other terms and conditions of contracts of insurance; 

(c) specifying requisite qualifications, code of conduct and practical training for intermediary or 

insurance intermediaries and agents; 

(d) specifying the code of conduct for surveyors and loss assessors; 

(e) promoting efficiency in the conduct of insurance business; 

(f)  promoting  and  regulating  professional  organisations  connected  with  the  insurance  and  

re-insurance business; 

(g) levying fees and other charges for carrying out the purposes of this Act; 

(h)  calling  for  information  from,  undertaking  inspection  of,  conducting  enquiries  and 
investigations  including  audit  of  the  insurers,  intermediaries,  insurance  intermediaries  and  other 
organisations connected with the insurance business; 

(i) control and regulation of the rates, advantages, terms and conditions that may be offered by 
insurers  in  respect  of  general  insurance  business  not  so  controlled  and  regulated  by  the  Tariff 
Advisory Committee under section 64U of the Insurance Act, 1938 (4 of 1938); 

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(j) specifying the form and manner in which books of account shall be maintained and statement 

of accounts shall be rendered by insurers and other insurance intermediaries; 

(k) regulating investment of funds by insurance companies; 

(l) regulating maintenance of margin of solvency; 

(m) adjudication of disputes between insurers and intermediaries or insurance intermediaries; 

(n) supervising the functioning of the Tariff Advisory Committee;  

(o) specifying the percentage of premium income of the insurer to finance schemes for promoting 

and regulating professional organisations referred to in clause (f); 

(p)  specifying  the  percentage  of  life  insurance  business  and  general  insurance  business  to  be 

undertaken by the insurer in the rural or social sector; and 

(q) exercising such other powers as may be prescribed. 

CHAPTER V 

FINANCE, ACCOUNTS AND AUDIT 

15. Grants by Central Government.—The Central Government may, after due appropriation made 
by  Parliament  by  law  in  this  behalf,  make  to  the  Authority  grants  of  such  sums  of  money  as  the 
Government may think fit for being utilised for the purposes of this Act. 

16.  Constitution  of  Fund.—(1)  There  shall  be  constituted  a  fund  to  be  called  “the  Insurance 

Regulatory and Development Authority Fund” and there shall be credited thereto— 

(a) all Government grants, fees and charges received by the Authority; 

(b)  all  sums  received  by  the  Authority  from  such  other  source  as  may  be  decided  upon  by  the 

Central Government; 

1* 

* 

* 

* 

* 

(2) The Fund shall be applied for meeting— 

(a) the salaries, allowances and other remuneration of the members, officers and other employees 

of the Authority; 

(b) the other expenses of the Authority in connection with the discharge of its functions and for 

the purposes of this Act. 

17.  Accounts  and  audit.—(1)  The  Authority  shall  maintain  proper  accounts  and  other  relevant 
records and prepare an annual statement of accounts in such form as  may be prescribed by the Central 
Government in consultation with the Comptroller and Auditor-General of India. 

(2) The accounts of the Authority shall be audited by the Comptroller and Auditor-General of India at 
such  intervals  as  may  be  specified  by  him  and  any  expenditure  incurred  in  connection  with  such  audit 
shall be payable by the Authority to the Comptroller and Auditor-General. 

(3)  The  Comptroller  and  Auditor-General  of  India  and  any  other  person  appointed  by  him  in 
connection  with  the  audit  of  the  accounts  of  the  Authority  shall  have  the  same  rights,  privileges  and 
authority  in  connection  with  such  audit  as  the  Comptroller  and  Auditor-General  generally  has  in 
connection with the audit of the Government accounts and, in particular, shall have the right to demand 
the production of books of account, connected vouchers and other documents and papers and to inspect 
any of the offices of the Authority. 

(4) The accounts of the Authority as certified by the Comptroller and Auditor-General of India or any 
other  person  appointed  by  him  in  this  behalf  together  with  the  audit  report  thereon  shall  be  forwarded 
annually  to  the  Central  Government  and  that  Government  shall  cause  the  same  to  be  laid  before  each 
House of Parliament. 

1. Clause (c) omitted by Act 5 of 2015, s. 107 (w.e.f  26-12-2014). 

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CHAPTER VI 

MISCELLANEOUS 

18.  Power  of  Central  Government  to  issue  directions.—(1)  Without  prejudice  to  the  foregoing 
provisions of this Act, the Authority shall, in exercise of its powers or the performance of its functions 
under this Act, be bound by such directions on questions of policy, other than those relating to technical 
and administrative matters, as the Central Government may give in writing to it from time to time: 

Provided that the Authority shall, as far as practicable, be given an opportunity to express its views 

before any direction is given under this sub-section. 

(2) The decision of the Central Government, whether a question is one of policy or not, shall be final. 

19.  Power  of  Central  Government  to  supersede  Authority.—(1)  If,  at  any  time  the  Central 

Government is of the opinion,— 

(a) that, on account of circumstances beyond the control of the Authority, it is unable to discharge 

the functions or perform the duties imposed on it by or under the provisions of this Act; or 

(b)  that  the  Authority  has  persistently  defaulted  in  complying  with  any  direction  given  by  the 
Central Government under this Act or in the discharge of the functions or performance of the duties 
imposed  on  it  by  or  under  the  provisions  of  this  Act  and  as  a  result  of  such  default  the  financial 
position of the Authority or the administration of the Authority has suffered; or 

(c) that circumstances exist which render it necessary in the public interest so to do, 

the  Central  Government  may,  by  notification  and  for  reasons  to  be  specified  therein,  supersede  the 
Authority for such period, not exceeding six months, as may be specified in the notification and appoint a 
person to be the Controller of Insurance under section 2B of the Insurance Act, 1938 (4 of 1938), if not 
already done: 

Provided  that  before  issuing  any  such  notification,  the  Central  Government  shall  give  a  reasonable 
opportunity to the Authority to make representations against the proposed supersession and shall consider 
the representations, if any, of the Authority. 

(2) Upon the publication of a notification under sub-section (1) superseding the Authority,— 

(a) the Chairperson and other members shall, as from the date of supersession, vacate their offices 

as such; 

(b)  all  the  powers,  functions  and  duties  which  may,  by  or  under  the  provisions  of  this  Act,  be 
exercised  or  discharged  by  or  on  behalf  of  the  Authority  shall,  until  the  Authority  is  reconstituted 
under sub-section (3), be exercised and discharged by the Controller of Insurance; and 

(c) all properties owned or controlled by the Authority shall, until the Authority is reconstituted 

under sub-section (3), vest in the Central Government. 

(3) On or before the expiration of the period of supersession specified in the notification issued under 
sub-section  (1),  the  Central  Government  shall  reconstitute  the  Authority  by  a  fresh  appointment  of  its 
Chairperson and other members and in such case any person who had vacated his office under clause (a) 
of sub-section (2) shall not be deemed to be disqualified for reappointment. 

(4) The Central Government shall cause a copy of the notification issued under sub-section (1) and a 
full report of any action taken under this section and the circumstances leading to such action to be laid 
before each House of Parliament at the earliest. 

20.  Furnishing  of  returns,  etc.,  to  Central  Government.—(1)  The  Authority  shall  furnish  to  the 
Central Government at such time and in such form and manner as may be prescribed, or as the Central 
Government may direct to furnish such returns, statements and other particulars in regard to any proposed 
or  existing  programme  for  the  promotion  and  development  of  the  insurance  industry  as  the  Central 
Government may, from time to time, require. 

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(2)  Without  prejudice  to  the  provisions  of  sub-section  (1),  the  Authority  shall,  within  nine  months 
after the  close  of  each  financial  year,  submit to the  Central  Government  a report  giving  a  true and full 
account of its activities including the activities for promotion and development of the insurance business 
during the previous financial year. 

 (3) Copies of the reports received under sub-section (2) shall be laid, as soon as may be after they are 

received, before each House of Parliament. 

21. Chairperson, members, officers and other  employees of Authority to be public servants.—
The Chairperson, members, officers and other employees of the Authority shall be deemed, when acting 
or  purporting  to  act  in  pursuance  of  any  of  the  provisions  of  this  Act,  to  be  public  servants  within  the 
meaning of section 21 of the Indian Penal Code (45 of 1860). 

22. Protection of action taken in good faith.—No suit, prosecution or other legal proceedings shall 
lie against the Central Government or any officer of the Central Government or any member, officer or 
other employee of the Authority for anything which is in good faith done or intended to be done under 
this Act or the rules or regulations made thereunder: 

Provided that nothing in this Act shall exempt any person from any suit or other proceedings which 

might, apart from this Act, be brought against him. 

23. Delegation of powers.— (1) The Authority may, by general or special order in writing, delegate 
to the Chairperson or any other member or officer of the Authority subject to such conditions, if any, as 
may be specified in the order, such of its powers and functions under this Act as it may deem necessary. 

(2) The Authority may, by a general or special order in writing, also form committees of the members 

and delegate to them the powers and functions of the Authority as may be specified by the regulations.  

1[23A.  Powers  of  Authority  not  to  apply  to  International  Financial  Services  Centre.—
Notwithstanding anything contained in any other law for the time being in force, the powers exercisable 
by the Authority under this Act, — 

(a) shall not extend to an International Financial Services Centre set up under sub-section (1) of 

section 18 of the Special Economic Zones Act, 2005 (28 of 2005); 

(b)  shall  be  exercisable  by  the  International  Financial  Services  Centres  Authority  established 
under sub-section (1) of section 4 of the International Financial Services Centres Authority Act, 2019,  

in so far as regulation of financial products, financial services and financial institutions that are permitted 
in the International Financial Services Centres are concerned.] 

24.  Power  to  make  rules.—(1)  The  Central  Government  may,  by  notification,  make  rules  for 

carrying out the provisions of this Act. 

(2)  In  particular,  and  without  prejudice  to  the  generality  of  the  foregoing  power,  such  rules  may 

provide for all or any of the following matters, namely:— 

(a)  the  salary  and  allowances  payable  to,  and  other  terms  and  conditions  of  service  of,  the 

members other than part-time members under sub-section (1) of section 7; 

(b) the allowances to be paid to the part-time members under sub-section (2) of section 7; 

(c) such other powers that may be exercised by the Authority under clause (q) of sub-section (2) 

of section 14; 

(d)  the  form  of  annual  statement  of  accounts  to  be  maintained  by  the  Authority  under  

sub-section (1) of section 17; 

(e)  the  form  and  manner  in  which  and  the  time  within  which  returns  and  statements  and 

particulars are to be furnished to the Central Government under sub-section (1) of section 20; 

1. Ins. by Act 50 of 2019, s. 33 and the second Schedule (w.e.f. 1-10-2020). 

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(f) the matters under sub-section (5) of section 25 on which the Insurance Advisory Committee 

shall advise the Authority; 

(g)  any  other  matter  which  is  required  to  be,  or  may  be,  prescribed,  or  in  respect  of  which 

provision is to be or may be made by rules. 

25.  Establishment  of  Insurance  Advisory  Committee.—(1)  The  Authority  may,  by  notification, 
establish with effect from such date as it may specify in such notification, a Committee to be known as 
the Insurance Advisory Committee. 

(2) The Insurance Advisory Committee shall consist of not more than twenty-five members excluding 
ex officio members to represent the interests of commerce, industry, transport, agriculture, consumer fora, 
surveyors,  agents,  intermediaries,  organisations  engaged  in  safety  and  loss  prevention,  research  bodies 
and employees‟ association in the insurance sector. 

(3)  The  Chairperson  and  the  members  of  the  Authority  shall  be  the  ex  officio  Chairperson  and  

ex officio members of the Insurance Advisory Committee. 

(4)  The  objects  of  the  Insurance  Advisory  Committee  shall  be  to  advise  the  Authority  on  matters 

relating to the making of the regulations under section 26. 

(5)  Without  prejudice  to  the  provisions  of  sub-section  (4),  the  Insurance  Advisory  Committee  may 

advise the Authority on such other matters as may be prescribed. 

26.  Power  to  make  regulations.—(1)  The  Authority  may,  in  consultation  with  the  Insurance 
Advisory  Committee,  by  notification,  make  regulations  consistent  with  this  Act  and  the  rules  made 
thereunder to carry out the purposes of this Act. 

(2) In particular, and without prejudice to the generality of the foregoing power, such regulations may 

provide for all or any of the following matters, namely:— 

(a)  the  time  and  places  of  meetings  of  the  Authority  and  the  procedure  to  be  followed  at  such 
meetings  including  the  quorum  necessary  for  the  transaction  of  business  under  sub-section  (1)  of 
section 10; 

(b) the transaction of business at its meetings under sub-section (4) of section 10; 

(c)  the  terms  and  other  conditions  of  service  of  officers  and  other  employees  of  the  Authority 

under sub-section (2) of section 12; 

(d)  the  powers  and  functions  which  may  be  delegated  to  committees  of  the  members  under  

sub-section (2) of section 23; and 

(e) any other matter which is required to be, or may be, specified by regulations or in respect of 

which provision is to be or may be made by regulations. 

27.  Rules  and  regulations  to  be  laid  before  Parliament.—Every  rule  and  every  regulation  made 
under this Act shall be laid, as soon as may be after it is made, before each House of Parliament, while it 
is in session, for a total period of thirty days which may be comprised in one session or in two or more 
successive  sessions,  and  if,  before  the  expiry  of  the  session  immediately  following  the  session  or  the 
successive sessions aforesaid, both Houses agree in making any modification in the rule or regulation or 
both Houses agree that the rule or regulation should not be made, the rule or regulation shall thereafter 
have effect only in such modified form or be of no effect, as the case may be; so, however, that any such 
modification or annulment shall be without prejudice to the validity of anything previously done under 
that rule or regulation.  

28. Application of other laws not barred.—The provisions of this Act shall be in addition to, and 

not in derogation of, the provisions of any other law for the time being in force.  

29. Power to remove difficulties.—(1) If any difficulty arises in giving effect to the provisions of 
this Act, the Central Government may, by order published in the Official Gazette, make such provisions 
not inconsistent with the provisions of this Act as may appear to be necessary for removing the difficulty: 

10 

 
 Provided  that  no  order  shall  be  made  under  this  section  after  the  expiry  of  two  years  from  the 

appointed day. 

(2) Every order made under this section shall be laid, as soon as may be after it is made, before each 

House of Parliament. 

30.  Amendment  of  Act  4  of  1938.—The  Insurance  Act,  1938  shall  be  amended  in  the  manner 

specified in the First Schedule to this Act. 

31. Amendment of Act 31 of 1956.—The Life Insurance Corporation Act, 1956 shall be amended in 

the manner specified in the Second Schedule to this Act. 

32.  Amendment of  Act 57  of  1972.—The  General  Insurance  Business  (Nationalisation)  Act, 1972 

shall be amended in the manner specified in the Third Schedule to this Act. 

11 

 
 
THE FIRST SCHEDULE 

(See section 30) 

AMENDMENTS TO THE INSURANCE ACT, 1938 

(4 OF 1938) 

1. In the Act, except in clause (5B) of section 2 and section 2B, for “Controller” wherever it occurs, 
substitute “Authority” and such consequential changes as the rules of grammar may require shall also be 
made. 

2. In sections 27, 27A, 27B, 31, 32A, 40A, 48B, 64F, 64G, 64-I, 64J, 64L, 64R, 64UC, 64UM, 113 

and 115, for “Central Government” wherever they occur, substitute “Authority”. 

3. Section 2,— 

(a) after clause (1), insert the following:—  

„(1A)  “Authority”  means  the  Insurance  Regulatory  and  Development  Authority  established 
under sub-section (1) of section 3 of the Insurance Regulatory and Development Authority Act, 
1999;‟; 

(b) for clause (5B), substitute the following:— 

„(5B)  “Controller  of  Insurance”  means  the  officer  appointed  by  the  Central  Government 
under section 2B to exercise all the powers, discharge the functions and perform the duties of the 
Authority under this Act or the Life Insurance Corporation Act, 1956 (31 of 1956) or the General 
Insurance  Business  (Nationalisation)  Act,  1972  (57  of  1972)  or  the  Insurance  Regulatory  and 
Development Authority Act, 1999;‟; 

(c) after clause (7), insert the following:— 

„(7A) “Indian insurance company” means any insurer being a company— 

(a) which is formed and registered under the Companies Act, 1956 (1 of 1956); 

(b)  in  which  the  aggregate  holdings  of  equity  shares  by  a  foreign  company,  either  by 
itself or through its subsidiary companies or its nominees, do not exceed twenty-six per cent. 
paid-up equity capital of such Indian insurance company; 

(c) whose sole purpose is to carry on life insurance business or general insurance business 

or re-insurance business. 

Explanation.—For the purposes of this clause, the expression “foreign company” shall have 
the  meaning  assigned  to  it  under  clause  (23A)  of  section  2  of  the  Income-tax  Act,  1961 (43  of 
1961);‟; 

(d) in clause (14), for “section 114”, substitute “this Act”. 

4. After section 2, insert the following:— 

“2A.  Interpretation  of  certain  words  and  expressions.—Words  and  expressions  used  and  not 
defined in this Act but defined in the Life Insurance Corporation Act, 1956 (31 of 1956), the General 
Insurance  Business  (Nationalisation)  Act,  1972  (57  of  1972)  and  the  Insurance  Regulatory  and 
Development  Authority  Act,  1999  shall  have  the  meanings  respectively  assigned  to  them  in  those 
Acts.”. 

5. Section 2B, for sub-section (1), substitute the following:— 

“(1)  If  at  any  time,  the  Authority  is  superseded  under  sub-section  (1)  of  section  19  of  the 
Insurance  Regulatory  and  Development  Authority  Act,  1999,  the  Central  Government  may,  by 
notification in the Official Gazette, appoint a person to be the Controller of Insurance till such time 
the Authority is reconstituted under sub-section (3) of section 19 of that Act.”. 

12 

 
 
6. Section 2C, in sub-section (1), after the second proviso, insert the following:— 

“Provided also that no insurer other than an Indian insurance company shall begin to carry on any 
class  of insurance  business  in  India  under  this  Act  on  or  after  the  commencement  of the  Insurance 
Regulatory and Development Authority Act, 1999.”. 

7. Section 3,— 

(a) in sub-section (1), after the first proviso, insert the following:— 

“Provided  further  that  a  person  or  insurer,  as  the  case  may  be,  carrying  on  any  class  of 
insurance  business  in  India,  on  or  before  the  commencement  of  the  Insurance  Regulatory  and 
Development  Authority  Act,  1999,  for  which  no  registration  certificate  was  necessary  prior  to 
such  commencement,  may  continue  to  do  so  for  a  period  of  three  months  from  such 
commencement or, if he had made an application for such registration within the said period of 
three months, till the disposal of such application: 

Provided  also  that  any  certificate  of  registration,  obtained  immediately  before  the 
commencement  of  the  Insurance  Regulatory  and  Development  Authority  Act,  1999,  shall  be 
deemed to have been obtained from the Authority in accordance with the provisions of this Act.”; 

(b) in sub-section (2),— 

(i) in the opening portion, for “Every application for registration shall be accompanied by—”, 

substitute the following:— 

“Every application for registration shall be made in such manner as may be determined by the 

regulations made by the Authority and shall be accompanied by—”; 

 (ii)  in  clause  (d),  for  “working  capital”,  substitute  “paid-up  equity  capital  or  working 

capital”; 

(iii) in clause (f), in the proviso, omit “and” occurring at the end; 

(iv) for clause (g), substitute the following:— 

“(g) the receipt showing payment of fee as may be determined by the regulations which 
shall not exceed fifty thousand rupees for each class of business as may be specified by the 
regulations made by the Authority; 

(h) such other documents as may be specified by the regulations made by the Authority;”; 

(c) after sub-section (2A), insert— 

“(2AA)  The  Authority  shall  give  preference  to  register  the  applicant  and  grant  him  a 
certificate of registration if such applicant agrees, in the form and manner as may be specified by 
the regulations made by the Authority, to carry on the life insurance business or general insurance 
business for providing health cover to individuals or group of individuals.”; 

(d) in sub-section (4),— 

(i) in clause (f), for “of any rule or order made thereunder, or”, substitute the following:— 

“of any rule or any regulation or order made or, any direction issued thereunder, or”; 

(ii) in clause (h), insert “or” at the end; 

(iii) after clause (h), insert the following:— 

“(i) if the insurer makes a default in complying with any direction issued or order made, 
as  the  case  may  be,  by  the  Authority  under  the  Insurance  Regulatory  and  Development 
Authority Act, 1999, or 

(j)  if  the  insurer  makes  a  default  in  complying  with,  or  acts  in  contravention  of,  any 
requirement of the Companies Act, 1956 (1 of 1956) or the Life Insurance Corporation Act, 
1956 (31 of 1956) or the General Insurance Business (Nationalisation) Act, 1972 (57 of 1972) 
or the Foreign Exchange Regulation Act, 1973 (46 of 1973).”; 

13 

 
 
(e) in sub-section (5C),— 

(i) for “clause (h)”, substitute “clause (h) or clause (i) or clause (j)”; 

(ii) for “any requirement of this Act or of any rule or order made thereunder”, substitute the 

following:— 

“any  requirement  of  this  Act  or  the  Insurance  Regulatory  and  Development  Authority  Act, 
1999, or of any rule or any regulation, or any order made thereunder or any direction issued under 
those Acts”; 

(f) after sub-section (5D), insert the following:— 

“(5E) The Authority may, by order, suspend or cancel any registration in such manner as may 

be determined by the regulations made by it: 

Provided that no order under this sub-section shall be made unless the person concerned has 

been given a reasonable opportunity of being heard.”; 

(g) for sub-section (7), substitute the following:— 

“(7) The Authority may, on payment of such fee, not exceeding five thousand rupees, as may 
be  determined  by  the  regulations,  issue  a  duplicate  certificate  of  registration  to  replace  a 
certificate lost, destroyed or mutilated, or in any other case where the Authority is of opinion that 
the issue of duplicate certificate is necessary.”.  

8. Section 3A,— 

(a) in sub-section (1), for “the 31st day of December, 1941.”, substitute the following:— 

“the 31st day of March, after the commencement of the Insurance Regulatory and Development 

Authority Act, 1999.”; 

(b) in sub-section (2),— 

(i)  for  “prescribed  fee”,  substitute  “fee  as  determined  by  the  regulations  made  by  the 

Authority”; 

(ii) for clause (i), substitute the following:— 

“(i)  exceed  one-fourth  of  one  per  cent.  of  such  premium  income  or  rupees  five  crores, 

whichever is less,”; 

(iii) for clause (ii), substitute the following:— 

“(ii) be less, in any case, than fifty thousand rupees for each class of insurance business:”;  

(c) in sub-section (3), for “prescribed fee”, substitute “fee as determined by the regulations made 

by the Authority”; 

(d) in sub-section (4), for “prescribed fee”, substitute “fee as determined by the regulations made 

by the Authority, and”. 

9. For section 6, substitute the following:— 

“6.  Requirement  as  to  capital.—No  insurer  carrying  on  the  business  of  life  insurance,  general 
insurance  or  re-insurance  in  India  on  or  after  the  commencement  of  the  Insurance  Regulatory  and 
Development Authority Act, 1999, shall be registered unless he has,— 

(i) a paid-up equity capital of rupees one hundred crores, in case of a person carrying on the 

business of life insurance or general insurance; or 

(ii)  a  paid-up  equity  capital  of  rupees  two  hundred  crores,  in  case  of  a  person  carrying  on 

exclusively the business as a re-insurer: 

14 

 
 
Provided that in determining the paid-up equity capital specified under clause (i) or clause (ii), the 
deposit  to  be  made  under  section  7  and  any  preliminary  expenses  incurred  in  the  formation  and 
registration of the company shall be excluded: 

Provided  further  that  an  insurer  carrying  on  business of  life  insurance,  general  insurance  or  re-
insurance in India before the commencement of the Insurance Regulatory and Development Authority 
Act, 1999 and who is required to be registered under this Act, shall have a paid-up equity capital in 
accordance  with  clause  (i)  and  clause  (ii),  as  the  case  may  be,  within  six  months  of  the 
commencement of that Act.”.  

10. Section 6A,— 

(a) in sub-section (4), in clause (b),— 

(I) in sub-clause (i), omit “and” occurring at the end; 

(II)  in  sub-clause  (ii),  for  “sanction  of  the  Central  Government  has  been  obtained  to  the 

transfer.”, substitute “approval of the Authority has been obtained to the transfer;”; 

(III) after sub-clause (ii), insert the following:—  

„(iii) where, the nominal value of the shares intended to be transferred by any individual, 
firm, group, constituents of a group, or body corporate under the same management, jointly 
or  severally  exceeds  one  per  cent.  of  the  paid-up  equity  capital  of  the  insurer,  unless  the 
previous approval of the Authority has been obtained for the transfer. 

Explanation.—For  the  purposes  of  this  sub-clause,  the  expressions  “group”  and  “same 
management” shall have the same meanings respectively assigned to them in the Monopolies 
and Restrictive Trade Practices Act, 1969 (54 of 1969).‟; 

(b) in sub-section (11),— 

(i) for “Explanation 1”, substitute “Explanation”; 

(ii) omit Explanation 2. 

11. After section 6A, insert the following:— 

“6AA. Manner of divesting excess shareholding by promoter in certain cases.—(1) No promoter 
shall at any time hold more than twenty-six per cent. or such other percentage as may be prescribed, 
of the paid-up equity capital in an Indian insurance company: 

Provided that in a case where an Indian insurance company begins the business of life insurance, 
general insurance or re-insurance in which the promoters hold more than twenty-six per cent. of the 
paid-up  equity  capital  or  such  other  excess  percentage  as  may  be  prescribed,  the  promoters  shall 
divest in a phased manner the share capital in excess of the twenty-six per cent. of the paid-up equity 
capital or such excess paid-up equity capital as may be prescribed, after a period of ten years from the 
date  of  the  commencement  of  the  said  business  by  such  Indian  insurance  company  or  within  such 
period as may be prescribed by the Central Government. 

Explanation.—For  the  removal  of  doubts,  it  is  hereby  declared  that  nothing  contained  in  the 
proviso shall apply to the promoters being foreign company, referred to in sub-clause (b) of clause 
(7A) of section 2. 

(2) The manner and procedure for divesting the excess share capital under sub-section (1) shall be 

specified by the regulations made by the Authority.”. 

12. Section 7,— 

(a) in sub-section (1),— 

(i) omit “not being an insurer specified in sub-clause (c) of clause (9) of section 2”; 

15 

 
 
(ii) for clauses (a) and (b), substitute the following:— 

“(a) in the case of life insurance business, a sum equivalent to one per cent. of his total 
gross premium written in India in any financial year commencing after the 31st day of March, 
2000, not exceeding rupees ten crores; 

(b) in the case of general insurance business, a sum equivalent to three per cent. of his 
total gross premium written in India, in any financial year commencing after the 31st day of 
March, 2000, not exceeding rupees ten crores; 

(c) in the case of re-insurance business, a sum of rupees twenty crores:”; 

(b) omit sub-sections (1A), (1B), (1C), (1D) and (1E). 

13. Section 11,— 

(a) in sub-section (1), for “calendar year”, substitute “financial year”; 

(b) after sub-section (1), insert the following:— 

“(1A)  Notwithstanding  anything  contained  in  sub-section  (1),  every  insurer,  on  or  after  the 
commencement of the Insurance Regulatory and Development Authority Act, 1999, in respect of 
insurance  business  transacted  by  him  and  in  respect  of  his  shareholders‟  funds,  shall,  at  the 
expiration of each financial year, prepare with reference to that year, a balance-sheet, a profit and 
loss account, a separate account of receipts and payments, a revenue account in accordance with 
the regulations made by the Authority.  

(1B) Every insurer shall keep separate accounts relating to funds of shareholders and policy-

holders.”. 

14. Section 13,— 

(a) in sub-section (1), — 

(i) for “once at least in every three years”, substitute “every year”; 

(ii) in the first proviso, for “not later than four years”, substitute “not later than two years”; 

(iii) after the second proviso, insert the following:— 

“Provided  also  that  for  an  insurer  carrying  on  life  insurance  business  in  India 
immediately  before  the  commencement  of  the  Insurance  Regulatory  and  Development 
Authority Act, 1999, the last date as at which the first investigation after such commencement 
should be caused by an actuary, shall be the 31st day of March, 2001:”; 

(iv) after the third proviso, insert the following:— 

“Provided  also  that  every  insurer,  on  or  after  the  commencement  of  the  Insurance 
Regulatory and Development Authority Act, 1999, shall cause an abstract of the report of the 
actuary to be made in the manner specified by the regulations made by the Authority.”;  

(b) in sub-section (4), after the proviso, insert the following:—  

“Provided further that the statement referred to in sub-section (4) shall be appended in the 

form and in the manner specified by the regulations made by the Authority.”. 

15. After section 27B, insert the following:— 

“27C. Prohibition for investment of funds outside India.—No insurer shall directly or indirectly 

invest outside India the funds of the policy-holders. 

27D.  Manner  and  conditions  of  investment.—(1)  Without  prejudice  to  anything  contained  in 
sections  27,  27A and  27B,  the  Authority  may,  in  the  interests  of the policy-holders, specify  by  the 
regulations made by it, the time, manner and other conditions of investment of assets to be held by an 
insurer for the purposes of this Act. 

16 

 
 
(2) The Authority may give specific directions for the time, manner and other conditions subject 
to which the funds of policy-holders shall be invested in the infrastructure and social sector as may be 
specified by regulations made by the Authority and such regulations shall apply uniformly to all the 
insurers carrying on the business of life insurance, general insurance, or re-insurance in India on or 
after the commencement of the Insurance Regulatory and Development Authority Act, 1999. 

(3) The Authority may, after taking into account the nature of business and to protect the interests 
of  the  policy-holders,  issue  to  an  insurer  the  directions  relating  to  the  time,  manner  and  other 
conditions of investment of assets to be held by him: 

Provided that no direction under this sub-section shall be issued unless the insurer concerned has 

been given a reasonable opportunity of being heard.”. 

16. Section 28A, in sub-section (1), for “31st day of December”, substitute “31st day of March”. 

17. Section 28B, in sub-section (1), for “31st day of December”, substitute “31st day of March”. 

18. Section 31B,— 

(a) in sub-section (1), for “Central Government” at both the places where they occur, substitute 

“Authority”; 

(b)  in  sub-section  (2),  for  “a  statement  in  the  prescribed  form”,  substitute  “a  statement,  in  the 

form specified by the regulations made by the Authority,”; 

(c) after sub-section (3), insert the following:— 

“(4) Every direction under this section shall be issued by an order made by the Authority: 

 Provided that no order under this section shall be made unless the person concerned has been 

given an opportunity of being heard.”.  

19. After section 32A, insert the following:— 

“32B. Insurance business in rural or social sector.—Every insurer shall, after the commencement 
of  the  Insurance  Regulatory  and  Development  Authority  Act,  1999,  undertake  such  percentages  of 
life  insurance  business  and  general  insurance  business  in  the  rural  or  social  sector,  as  may  be 
specified, in the Official Gazette by the Authority, in this behalf.  

32C. Obligations of insurer  in respect of rural or unorganised sector and backward classes.—
Every insurer shall, after the commencement of the Insurance Regulatory and Development Authority 
Act, 1999, discharge the obligations specified under section 32B to provide life insurance or general 
insurance policies to the persons residing in the rural sector, workers in the unorganised or informal 
sector  or  for  economically  vulnerable  or  backward  classes  of  the  society  and  other  categories  of 
persons as may be specified by regulations made by the Authority and such insurance policies shall 
include insurance for crops.”.  

20. For section 33, substitute the following:— 

„INVESTIGATION 

33. Power of investigation and inspection by Authority.—(1) The Authority may, at any time, by 
order in writing, direct any person (hereafter in this section referred to as  “Investigating Authority”) 
specified in the order to investigate the affairs of  any insurer and to report to the Authority on any 
investigation made by such Investigating Authority: 

Provided  that  the  Investigating  Authority  may,  wherever  necessary,  employ  any  auditor  or 

actuary or both for the purpose of assisting him in any investigation under this section. 

(2)  Notwithstanding  anything  to  the  contrary  contained  in  section  235  of  the  Companies  Act, 
1956 (1 of 1956), the Investigating Authority may, at any time, and shall, on being directed so to do 
by the Authority, cause an inspection to be made by one or more of his officers of any insurer and his 
books of account; and the Investigating Authority shall supply to the insurer a copy of his report on 
such inspection. 

17 

 
 
(3)  It  shall  be  the  duty  of  every  manager,  managing  director  or  other  officer  of  the  insurer  to 
produce before the Investigating Authority directed to make the investigation under sub-section (1), 
or inspection under sub-section (2), all such books of account, registers and other documents in his 
custody or power and to furnish him with any statement and information relating to the affairs of the 
insurer  as  the  said  Investigating  Authority  may  require  of  him  within  such  time  as  the  said 
Investigating Authority may specify. 

(4)  Any  Investigating  Authority,  directed  to  make  an  investigation  under  sub-section  (1),  or 
inspection  under  sub-section  (2),  may  examine  on  oath,  any  manager,  managing  director  or  other 
officer of the insurer in relation to his business and may administer oaths accordingly. 

(5)  The  Investigating  Authority  shall,  if  he  has  been  directed  by  the  Authority  to  cause  an 
inspection to be made, and  may, in any other case, report to the Authority on any inspection made 
under this section. 

(6)  On  receipt  of  any  report  under  sub-section  (1)  or  sub-section  (5),  the  Authority  may,  after 
giving such opportunity to the insurer to make a representation in connection with the report as, in the 
opinion of the Authority, seems reasonable, by order in writing,— 

(a) require the insurer, to take such action in respect of any matter arising out of the report as 

the Authority may think fit; or 

(b) cancel the registration of the insurer; or 

(c) direct any person to apply to the court for the winding up of the insurer, if a company, 

whether the registration of the insurer has been cancelled under clause (b) or not. 

(7) The Authority may, after giving reasonable notice to the insurer, publish the report submitted 
by the Investigating Authority under sub-section (5) or such portion thereof as may appear to it to be 
necessary.  

(8)  The  Authority  may  by  the  regulations  made  by  it  specify  the  minimum  information  to  be 
maintained by insurers in their books, the manner in which such information shall be maintained, the 
checks  and  other  verifications  to  be  adopted  by  insurers  in  that  connection  and  all  other  matters 
incidental thereto as are, in its opinion, necessary to enable the Investigating Authority to discharge 
satisfactorily his functions under this section. 

Explanation.—For the purposes of this section, the expression “insurer” shall include in the case 

of an insurer incorporated in India— 

(a)  all  its  subsidiaries  formed  for  the  purpose  of  carrying  on  the  business  of  insurance 

exclusively outside India; and 

(b) all its branches whether situated in India or outside India. 

(9) No order made under this section other than an order made under clause (b) of sub-section (6) 

shall be capable of being called in question in any court. 

(10)  All  expenses  of,  and  incidental  to,  any  investigation  made  under  this  section  shall  be 
defrayed  by  the  insurer,  shall  have  priority  over  that  debts  due  from  the  insurer  and  shall  be 
recoverable as an arrear of land revenue.‟.  

21. Section 33A, omit “Central Government or the”.  

22. Section 34H,— 

(a) in sub-section (1),— 

(i) for “Controller”, substitute “Chairperson of the Authority”; 

(ii)  for  “an  Assistant  Controller  of  Insurance”,  substitute  “an  officer  authorised  by  the 

Authority”; 

(b) in sub-sections (5) and (7), for “Controller” wherever it occurs, substitute “Chairperson of 

the Authority”. 

18 

 
 
23. Section 35,— 

(a) in sub-section (1), for “sanctioned by the Controller”, substitute “approved by the Authority”; 

(b) in sub-section (3),— 

(i) in the first paragraph, for “to sanction any such scheme”, substitute “to approve any such 

scheme”; 

(ii) in the second paragraph, for “the amalgamation or transfer if sanctioned”, substitute “the 

amalgamation or transfer if approved”. 

24. Section 36,— 

(a)  in  sub-section  (1),  for  “may  sanction  the  arrangement”,  substitute  “may  approve  the 

arrangement”; 

(b) in sub-section (2),— 

(i) for “the insurers concerned in the amalgamation, the Controller may sanction”, substitute 

“the insurers concerned in the amalgamation, the Authority may approve”; 

(ii) for “contracts as sanctioned by the Controller”, substitute “contracts as approved by the 

Authority”.  

25. Section 37, in clause (c), for “scheme sanctioned”, substitute “scheme approved”. 

26.  In  section  40A,  in  sub-section  (3),  for  the  portion  beginning  with  the  words  “an  amount 
exceeding” and ending with the words  “ten per cent. of the premium payable on the policy”, substitute 
“an amount not exceeding fifteen per cent. of the premium payable on the policy where the policy relates 
to fire or marine insurance or miscellaneous insurance.”. 

27. Section 42,— 

(a) for sub-section (1), substitute the following:— 

“(1) The Authority or an officer authorised by it in this behalf shall, in the manner determined 
by  the  regulations  made  by  it  and  on  payment  of  the  fee  determined  by  the  regulations,  which 
shall not be more than two hundred and fifty rupees, issue to any person making an application in 
the manner determined by the regulations, a licence to act as an insurance agent for the purpose of 
soliciting or procuring insurance business: 

Provided that,— 

(i)  in  the  case  of  an  individual,  he  does  not  suffer  from  any  of  the  disqualifications 

mentioned in sub-section (4); and 

(ii) in the case of a company or firm, any of its directors or partners does not suffer from 

any of the said disqualifications: 

Provided  further  that  any  licence  issued  immediately  before  the  commencement  of  the 
Insurance Regulatory and Development Authority Act, 1999 shall be deemed to have been issued 
in accordance with the regulations which provide for such licence.”; 

(b) for sub-section (3), substitute the following:— 

“(3) A licence issued under this section, after the date of the commencement of the Insurance 
Regulatory  and  Development  Authority  Act,  1999,  shall  remain  in  force  for  a  period  of  three 
years only from the date of issue, but shall, if the applicant, being an individual does not, or being 
a  company  or  firm  any  of  its  directors  or  partners  does  not,  suffer  from  any  of  the 
disqualifications  mentioned  in  clauses  (b),  (c),  (d),  (e)  and  (f)  of  sub-section  (4)  and  the 
application for renewal of licence reaches the issuing authority at least thirty days before the date 
on the licence ceases to remain in force, be renewed for a period of three years at any one time on 
payment of the fee determined by the regulations made by the Authority which shall not be more 
than  rupees  two  hundred  and  fifty,  and  additional  fee  of  an  amount  determined  by  the               

19 

 
regulations not exceeding rupees one hundred by way of penalty, if the application for renewal of 
the licence does not reach the issuing authority at  least thirty days before the date on which the 
licence ceases to remain in force.”; 

(c) in sub-section (3A), for the proviso, substitute the following:—  

“Provided that the Authority may, if satisfied that undue hardship would be caused otherwise, 
accept  any  application  in  contravention  of  this  sub-section  on  payment  by  the  applicant  of  a 
penalty of seven hundred and fifty rupees.”; 

(d) in sub-section (4), after clause (d), insert the following:— 

“(e) that he does not possess the requisite qualifications and practical training for a period not 
exceeding twelve months, as may be specified by the regulations made by the Authority in this 
behalf; 

(f) that he has not passed such examination as may be specified by the regulations made by 

the Authority in this behalf: 

Provided that a person who had been issued a licence under sub-section (1) of this section or 
sub-section  (1)  of  section  64UM  shall  not  be  required  to  possess  the  requisite  qualifications, 
practical training and pass such examination as required by clauses (e) and (f); 

(g) that he violates the code of conduct as may be specified by the regulations made by the 

Authority.”; 

(e) for sub-section (6), substitute the following:— 

“(6)  The  Authority  may  issue  a  duplicate  licence  to  replace  a  licence  lost,  destroyed  or 
mutilated,  on  payment  of  such  fee  not  exceeding  fifty  rupees  as  may  be  determined  by  the 
regulations.”; 

(f) in sub-section (7),— 

(i) for “fifty rupees”, substitute “five hundred rupees”; 

(ii) for “one hundred rupees”, substitute “one thousand rupees”; 

(g) in sub-section (8), for “fifty rupees”, substitute “five thousand rupees”.  

28. Section 42A, in sub-section (1),— 

(a) for “Controller or an officer authorised by him”, substitute “Authority or an officer authorised 

by it”; 

(b) for “an application to him”, substitute “an application to it”.  

29. After section 42C, insert the following:— 

“42D.  Issue  of  licence  to  intermediary  or  insurance  intermediary.—(1)  The  Authority  or  an 
officer authorised by it in this behalf shall, in the manner determined by the regulations made by the 
Authority and on payment of the fees determined by the regulations made by the Authority, issue to 
any  person  making  an  application  in  the  manner  determined  by  the  regulations,  and  not  suffering 
from any of the disqualifications herein mentioned, a licence to act as an intermediary or an insurance 
intermediary under this Act: 

Provided that,— 

(a) in the case of an individual, he does not suffer from any of the disqualifications mentioned 

in sub-section (4) of section 42, or 

(b) in the case of a company or firm, any of its directors or partners does not suffer from any 

of the said disqualifications. 

(2) A licence issued under this section shall entitle the holder thereof to act as an intermediary or 

insurance intermediary. 

20 

 
 
(3) A licence issued under this section shall remain in force for a period of three years only from 
the date of issue, but shall, if the applicant, being an individual does not, or being a company or firm 
any of its directors or partners does not suffer from any of the disqualifications mentioned in clauses 
(b),  (c),  (d),  (e)  and  (f)  of  sub-section  (4)  of  section  42  and  the  application  for  renewal  of  licence 
reaches the issuing authority at least thirty days before the date on which the licence ceases to remain 
in force, be renewed for a period of three years at any one time on payment of the fee, determined by 
the regulations made by the Authority and additional fee for an amount determined by the regulations, 
not  exceeding  one  hundred  rupees  by  way  of  penalty,  if  the  application  for  renewal  of  the  licence 
does not reach the issuing authority at least thirty days before the date on which the licence ceases to 
remain in force. 

(4)  No  application  for  the  renewal  of  a  licence  under  this  section  shall  be  entertained  if  the 

application does not reach the issuing authority before the licence ceases to remain in force: 

Provided  that  the  Authority  may,  if  satisfied  that  undue  hardship  would  be  caused  otherwise, 
accept any application in contravention of this sub-section on payment by the applicant of a penalty 
of seven hundred and fifty rupees. 

(5) The disqualifications above referred to shall be the following:— 

(a) that the person is a minor; 

(b) that he is found to be of unsound mind by a court of competent jurisdiction; 

(c) that he has been found guilty of criminal misappropriation or criminal breach of trust or 
cheating  or  forgery  or  an  abetment  of  or  attempt  to  commit  any  such  offence  by  a  court  of 
competent jurisdiction: 

Provided  that,  where  at  least  five  years  have  elapsed  since  the  completion  of  the  sentence 
imposed on any person in respect of any such offence, the Authority shall ordinarily declare in 
respect of such person that his conviction shall cease to operate as a disqualification under this 
clause; 

(d)  that  in  the  course  of  any  judicial  proceeding  relating  to  any  policy  of  insurance  of  the 
winding  up  of  an  insurance  company  or  in  the  course  of  an  investigation  of  the  affairs  of  an 
insurer it has been found that he has been guilty of or has knowingly participated in or connived 
at any fraud dishonestly or misrepresentation against an insurer or an insured; 

(e) that he does not possess the requisite qualifications and practical training for a period not 
exceeding twelve months, as may be specified by the regulations made by the Authority in this 
behalf; 

(f) that he has not passed such examinations as may be specified by the regulations made by 

the Authority in this behalf; 

(g) that he violates the code of conduct as may be specified by the regulations made by the 

Authority. 

(6)  If  it  be  found  that  an  intermediary  or  an  insurance  intermediary  suffers  from  any  of  the 
foregoing  disqualifications,  without  prejudice  to  any  other  penalty  to  which  he  may  be  liable,  the 
Authority shall, and if the intermediary or an insurance intermediary has knowingly contravened any 
provision  of  this  Act  may  cancel  the  licence  issued  to  the  intermediary  or  insurance  intermediary 
under this section. 

(7) The Authority may issue a duplicate licence to replace a licence lost, destroyed or mutilated, 

on payment of such fee, as may be determined by the regulations made by the Authority. 

(8)  Any  person  who  acts  as  an  intermediary  or  an  insurance  intermediary  without  holding  a 
licence issued under this section to act as such, shall be punishable with fine, and any insurer or any 
person who appoints as an intermediary or an insurance intermediary or any person not licensed to act 
as such or transacts any insurance business in India through any such person, shall be punishable with 
fine. 

21 

 
(9) Where the person contravening sub-section (8) is a company or a firm, then, without prejudice 
to any other proceedings which may be taken against the company or firm, every director, manager, 
secretary or other officer of the company, and every partner of the firm who is knowingly a party to 
such contravention shall be punishable with fine.”. 

30.  Section  64UA,  in  sub-section  (1),  in  sub-clause  (a),  for  “Controller  of  Insurance”,  substitute 

“Chairperson of the Authority”.  

31. Section 64UB,— 

(a) for sub-section (1), substitute the following:— 

“(1) The Authority may, by notification in the Official Gazette, make regulations to carryout 

the purposes of this Part.”;  

(b) in sub-section (2), for “rules”, substitute “regulations”; 

(c)  in  sub-section  (3),  for  “Central  Government”  at  both  the  places  where  it  occur,  substitute 

“Authority”; 

(d) in sub-section (5), for “Controller of Insurance”, substitute “Chairperson of the Authority”.  

32. Section 64UC, in sub-section (1), in proviso, for “the Controller may, with the previous approval 

of the Central Government”, substitute “the Authority may”. 

33. Section 64UD, after sub-section (1), insert the following:— 

“Provided  that  the  Chairperson  of  the  Authority  shall  become  the  Chairman  of  the  Advisory 
Committee  with  effect  from  the  commencement  of  the  Insurance  Regulatory  and  Development 
Authority Act, 1999 and function as such, and any Chairman of the Tariff Committee holding office 
immediately before such commencement shall cease to be the Chairman.”. 

34.  Section  64UJ,  in  sub-section  (5),  for  “Central  Government”,  wherever  it  occurs,  substitute 

“Authority”. 

35. Section 64UM,— 

(a) in sub-section (1),— 

(i)  in  paragraph  (B),  after  “the  Insurance  (Amendment)  Act,  1968”,  insert  “but  before  the 

commencement of the Insurance Regulatory and Development Authority Act, 1999”; 

(ii) after paragraph (B), insert the following:—  

“(BA) Every person who intends to act as a surveyor or loss assessor after the expiry of a 
period  of  one  year  from  the  commencement  of  the  Insurance  Regulatory  and  Development 
Authority  Act,  1999,  shall  make  an  application  to  the  Authority  within  such  time,  in  such 
manner  and  on  payment  of  such  fee  as  may  be  determined  by  the  regulations made  by  the 
Authority: 

Provided that any licence issued immediately before the commencement of the Insurance 
Regulatory  and  Development  Authority  Act,  1999  shall  be  deemed  to  have  been  issued  in 
accordance with the regulations providing for such licence.”; 

(iii) in paragraph (C), for  “as may be prescribed”, substitute  “as may be determined by the 

regulations”; 

(iv) in paragraph (D), in clause (i),— 

(A) for item (a), substitute the following:— 

“(a) has been in practice as a surveyor or loss assessor on the date of commencement 

of the Insurance Regulatory and Development Authority Act, 1999, or”; 

(B)  in  item  (f),  for  “prescribed”,  substitute  “specified  by  the  regulations  made  by  the 

Authority”; 

22 

 
 
(b) after sub-section (1), insert— 

“(1A) Every surveyor and loss assessor shall comply with the code of conduct in respect of 
their  duties,  responsibilities  and  other  professional  requirements  as  may  be  specified  by  the 
regulations made by the Authority.”.  

36. Section 64V,— 

(a) in sub-section (1),— 

(i) in clause (i), after sub-clause (g), insert the following:— 

“(h)  such  other  asset  or  assets  as  may  be  specified  by  the  regulations  made  in  this 

behalf;”; 

(ii) in clause (ii),— 

(A) in sub-clause (b), in items (i) and (ii), for “40 per cent.”, substitute “50 per cent.”; 

(B) after sub-clause (f), insert the following:— 

“(g)  such  other  liability  which  may  be  made  in  this  behalf  to  be  included  for  the 

purpose of clause (ii).”; 

(b) for sub-section (2), substitute the following:— 

 “(2) Every insurer shall furnish to the Authority with his returns under section 15 or section 
16, as the case may be, a statement certified by an auditor approved by the Authority in respect of 
general insurance business, or an actuary approved by the Authority in respect of life insurance 
business, as the case may be, of his assets and liabilities assessed in the manner required by this 
section as on the 31st day of March of the preceding year. 

(3) Every insurer shall value his assets and liabilities in the manner required by this section 

and in accordance with the regulations which may be made by the Authority in this behalf.”. 

37. Section 64VA,— 

(a) in sub-section (1), for “at all times”, substitute “at all times before the commencement of the 

Insurance Regulatory and Development Authority Act, 1999”; 

(b) after sub-section (1), insert the following:— 

„(1A)  Every  insurer  shall,  at  all  times,  on  or  after  the  commencement  of  the  Insurance 
Regulatory and Development Authority Act, 1999, maintain an excess of the value of his assets 
over  the  amount  of  his  liabilities  of  not  less  than  the  amount  arrived  at  as  follows  (hereinafter 
referred to in this section referred to as the “required solvency margin”), namely:— 

(i)  in  the  case  of  an  insurer  carrying  on  life  insurance  business,  the  required  solvency 

margin shall be the higher of the following amounts— 

(a) fifty crores of rupees (one hundred crores of rupees in case of re-insurers); or 

(b) the aggregate sums of the results arrived at in items (I) and (II) stated below:— 

(I) the aggregate of the results arrived at by applying the calculation described in 

item (A) below (Step I) and the calculation described in item (B) below (Step II): 

(A) for Step I— 

(A.  1)  there  shall  be  taken,  a  sum  equal  to  a  percentage  determined  by  the 
regulations  not  exceeding  five  per  cent.  of  the  mathematical  reserves  for  direct 
business  and  re-insurance  acceptances  without  any  deduction  for  re-insurance 
cessions; 

(A.  2)  the  amount  of  mathematical  reserves  at  the  end  of  the  preceding 
financial year after the deduction of re-insurance cessions shall be expressed as a 

23 

 
percentage  of  the  amount  of  those  mathematical  reserves  before  any  such 
deduction; and 

(A. 3) the sum mentioned in item (A. 1) above shall be multiplied— 

(A.3.1)  where  the  percentage  arrived  at  under  item  (A.  2)  above  is 
greater  than eighty-five  per  cent.  (or  in the case  of  a  re-insurer carrying  on 
exclusive  re-insurance  business,  fifty  per  cent.),  by  that  greater  percentage; 
and 

(A.3.2) in any other case, by eighty-five per cent. (or in the case of a re-

insurer carrying on exclusive re-insurance business, by fifty per cent.); 

(B) for Step II— 

(B.  1)  there  shall  be  taken,  a  sum  equal  to  a  percentage  determined  by  the 
regulations made by the Authority not exceeding one per cent. of the sum at risk 
for the policies on which the sum at risk is not a negative figure, and 

(B. 2) the amount of sum at risk at the end of the preceding financial year for 
policies on which the sum at risk is not a negative figure after the deduction of 
re-insurance cession shall be expressed as a percentage of the amount of that sum 
at risk before any such deduction, and 

(B. 3) the sum arrived at under item (B. 1) above shall be multiplied— 

(B.  3.1)  where  the  percentage  arrived  at  under  item  (B.  2)  above  is 

greater than fifty per cent., by that greater percentage; and 

(B. 3.2) in any other case, by fifty per cent. 

(II) a percentage determined by the regulations made by the Authority of the 

value of assets determined in accordance with the provisions of section 64V; 

(ii) in the case of an insurer carrying on general insurance business, the required solvency 

margin, shall be the highest of the following amounts:— 

(a) fifty crores of rupees (one hundred crores of rupees in case of re-insurer); or 

(b) a sum equivalent to twenty per cent. of net premium income; or 

(c) a sum equivalent to thirty per cent. of net incurred claims, 

subject to credit for re-insurance in computing net premiums and net incurred claims being actual but a 
percentage, determined by the regulations not exceeding fifty per cent.: 

Provided  that  if  in  respect  of  any  insurer,  the  Authority  is  satisfied  that  either  by  reason  of  an 
unfavourable claim experience or because of sharp increase in the volume of the business, or for any other 
reason, compliance with the provisions of this sub-section would cause undue hardship to the insurer, the 
Authority may direct, for such period and subject to such conditions, such solvency margin not being less 
than the lower of the amount mentioned in sub-clause (i) or sub-clause (ii) above as the case may be. 

 Explanation.—For the purposes of this sub-section, the expressions— 

(i)  “mathematical  reserves”  means  the  provision  made  by  an  insurer  to  cover  liabilities  (excluding 
liabilities which have fallen due and liabilities arising from deposit back arrangement in relation to any 
policy whereby an amount is deposited by re-insurer with the cedant) arising under or in connection with 
policies or contracts for life insurance business. Mathematical reserves also include specific provision for 
adverse deviations of the bases, such as mortality and morbidity rates, interest rates, and expense rates, 
and any explicit provisions made, in the valuation of liabilities, in accordance with the regulations made 
by the Authority for this purpose; 

(ii) “net incurred claims” means the average of the net incurred claims during the specified period of 

not exceeding three preceding financial years; 

24 

 
 
(iii) “sum at risk”, in relation to a life insurance policy, means a sum which is— 

(a) in any case in which an amount is payable in consequence of death other than a case falling 

within sub-clause (b) below, the amount payable on death, and 

(b)  in  any  case  in  which  the  benefit  under  the  policy  in  question  consists  of  the  making,  in 
consequence of death, of the payments of annuity, payment of a sum by instalments or any other kind 
of periodic payments, the present value of that benefit, 

less in either case the mathematical reserves in respect of the relevant policies.'; 

(c) after sub-section (2), insert the following:— 

“(2A)  If,  at  any  time  an  insurer  does  not  maintain  the  required  solvency  margin  in  accordance 
with the provisions of this section, he shall, in accordance with the directions issued by the Authority, 
submit a financial plan, indicating a plan of action to correct the deficiency to the Authority within a 
specified period not exceeding three months. 

(2B) An insurer who has submitted a plan under sub-section (2A) to the Authority shall propose 
modifications  to the  plan if  the  Authority  considers it  inadequate, and  shall  give  effect  to  any  plan 
accepted by the Authority as adequate. 

(2C) An insurer who does not comply with the provisions of sub-section (2A) shall be deemed to 

be insolvent and may be wound up by the court.”; 

(d) after sub-section (6), insert the following:— 

“(7) Every insurer shall furnish to the Authority his returns under section 15 or section 16, as the 
case may be, in case of life insurance business a statement certified by an actuary approved by the 
Authority, and in case of general insurance business a statement certified by an auditor approved by 
the Authority, of the required solvency margin maintained by the insurer in the manner required by 
sub-section (1A).”.  

38.  Section  70,  in  sub-section  (1),  for  “the  Controller  a  certificate  of  registration”,  substitute  “the 
Authority,  before  the  date  of  commencement  of  the  Insurance  Regulatory  and  Development  Authority 
Act, 1999, a certificate of registration”.  

39.  Section  95,  in  sub-section  (1),  for  “In  this  Part—”,  substitute  “In  this  Part,  before  the  date  of 

commencement of the Insurance Regulatory and Development Authority Act, 1999,—”. 

40. Section 101A,— 

(a) in sub-section (1), for “the Central Government”, substitute “the Authority, with the previous 

approval of the Central Government,”; 

(b) in sub-section (2), for “the Central Government”, substitute “the Authority”.  

41. Section 101B,— 

(a) in sub-section (1), for “the Central Government”, substitute “the Authority with the previous 

approval of the Central Government.”; 

(b)  in  sub-section  (2),  for  “prescribed”,  substitute  “determined  by  the  regulations  made  by  the 

Authority”. 

42. For sections 102 to 105, substitute the following:— 

“102. Penalty for default in complying with, or act in contravention of, this Act.—If any person, 

who is required under this Act, or rules or regulations made thereunder,— 

(a)  to  furnish  any  document,  statement,  account,  return  or  report  to  the  Authority,  fails  to 

furnish the same; or 

(b) to comply with the directions, fails to comply with such directions; 

25 

 
 
(c) to maintain solvency margin, fails to maintain such solvency margin; 

(d)  to  comply  with  the  directions  on  the  insurance  treaties,  fails  to  comply  with  such 

directions on the insurance treaties, 

he shall be liable to a penalty not exceeding five lakh rupees for each such failure and punishable with 
fine. 

103. Penalty for carrying on insurance business in contravention of sections 3, 7 and 98.—If a 
person makes a statement, or furnishes any document, statement, account, return or report which is 
false and which he either knows or believes to be false or does not believe to be true,— 

(a) he shall be liable to a penalty not exceeding five lakh rupees for each such failure; and 

(b) he shall be punishable with imprisonment which may extend to three years or with fine 

for each such failure. 

104. Penalty for false statement in document.—If a person fails to comply with the provisions of 
section 27 or section 27A or section 27B or section 27C or section 27D, he shall be liable to a penalty 
not exceeding five lakh rupees for each such failure. 

105. Wrongfully obtaining or withholding property.—If any director, managing director, manager 
or  other  officer  or  employees  of  an  insurer  wrongfully  obtains  possession  of  any  property  or 
wrongfully applies to any purpose of the Act, he shall be liable to a penalty not exceeding two lakh 
rupees for each such failure. 

105A. Offences by companies.—(1) Where any offence under this Act has been committed by a 
company,  every  person  who,  at  the  time  the  offence  was  committed,  was  in  charge  of,  and  was 
responsible to, the company for the conduct of the business of the company as well as the company 
shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished 
accordingly: 

Provided  that  nothing  contained  in  this  sub-section  shall  render  any  such  person  liable  to  any 
punishment,  if  he  proves  that  the  offence  was  committed  without  his  knowledge  or  that  he  had 
exercised all due diligence to prevent the commission of such offence. 

(2) Notwithstanding anything contained in sub-section (1), where any offence under this Act has 
been committed by a company and it is proved that the offence has been committed with the consent 
or connivance of, or is attributable to any neglect on the part of, any director, manager, secretary or 
other officer of the company, such director, manager, secretary or other officer shall be deemed to be 
guilty of that offence and shall be liable to be proceeded against and punished accordingly. 

Explanation.—For the purposes of this section,— 

(a) “company” means any body corporate, and includes— 

(i) a firm; and 

(ii) an association of persons or a body of individuals whether incorporated or not; and 

(b) “director”, in relation to— 

(i) a firm, means a partner in the firm; 

(ii) an association of persons or a body of individuals, means any member controlling the 

affairs thereof. 

105B.  Penalty  for  failure  to  comply  with  section  32B.—If  an  insurer  fails  to  comply  with  the 
provisions of section 32B, he shall be liable to a penalty not exceeding five lakh rupees for each such 
failure and shall be punishable with imprisonment which may extend to three years or with fine for 
each such failure. 

105C.  Penalty  for  failure  to  comply  with  section  32C.—If  an  insurer  fails  to  comply  with  the 
provisions of section 32C, he shall be liable to a penalty not exceeding twenty-five lakh rupees for 

26 

 
each such failure and in the case of subsequent and continuing failure, the registration granted to such 
insurer under section 3 shall be cancelled by the Authority.”.  

43. In sections 110A, 110B and 110C, for “Controller” wherever it occurs, substitute “Chairperson of 

the Authority”. 

44. Section 110G, for “Controller” at both the places where it occurs, substitute “Chairperson of the 

Authority”. 

 45. Section 110H, in sub-section (1), for “under sections”, substitute “under sections 27D,”.  

46. Section 114, in sub-section (2),— 

(a) after clause (a), insert the following:— 

“(aa) such other percentage of paid-up equity capital in excess of twenty-six per cent. of the 
paid-up  equity  capital  and  the  period  within  which  such  excess  paid-up  equity  capital  shall  be 
divested under sub-section (1) of section 6AA.”; 

(b) omit clauses (g) and (ll). 

47. After section 114, insert the following:— 

“114A. Power of Authority to make regulations.—(1) The Authority may, by notification in the 
Official Gazette, make regulations consistent with this Act and the rules made thereunder, to carry out 
the purposes of this Act. 

(2) In particular, and without prejudice to the generality of the foregoing power, such regulations 

may provide for all or any of the following matters, namely:— 

(a) the matters including fee relating to the registration of insurers under section 3; 

(b)  the  manner  of  suspension  or  cancellation  of  registration  under  sub-section  (5E)  of  

section 3; 

(c) such fee, not exceeding five thousand rupees, as may be determined by the regulations for 

issue of a duplicate certificate of registration under sub-section (7) of section 3; 

(d) the matters relating to the renewal of registration and fee therefor under section 3A; 

(e)  the  manner  and  procedure  for  divesting  excess  share  capital  under  sub-section  (2)  of 

section 6AA; 

(f) the preparation of balance-sheet, profit and loss account and a separate account of receipts 

and payments and revenue account under sub-section (1A) of section 11; 

(g)  the  manner  in  which  an  abstract  of  the  report  of  the  actuary  to  be  specified  under  the 

fourth proviso to sub-section (1) of section 13; 

(h) the form and manner in which the statement referred to in sub-section (4) of section 13 

shall be appended; 

(i)  the  time,  manner  and  other  conditions  of  investment  of  assets  held  by  an  insurer  under 

sub-sections (1), (2) and (3) of section 27D; 

(j) the minimum information to be maintained by insurer in their books, the manner in which 
such  information  should  be  maintained,  the  checks  and  other  verifications  to  be  adopted  by 
insurers in that connection and all other matters incidental thereto under sub-section (8) of section 
33; 

(k) the manner for making an application, the manner and the fee for issue of a licence to act 

as an insurance agent under sub-section (1) of section 42; 

(l) the fee and the additional fee to be determined for renewal of licence of insurance agent 

under sub-section (3) of section 42; 

27 

 
 
(m) the requisite qualifications and practical training to act as an insurance agent under clause 

(e) of sub-section (4) of section 42; 

(n) the passing of examination to act as an insurance agent under clause (f) of sub-section (4) 

of section 42; 

(o) the code of conduct under clause (g) of sub-section (4) of section 42; 

(p) the fee not exceeding rupees fifty for issue of duplicate licence under sub-section (6) of 

section 42; 

(q)  the  manner  and  the  fees  for  issue  of  a  licence  to  an  intermediary  or  an  insurance 

intermediary under sub-section (1) of section 42D; 

(r) the fee and the additional fee to be determined for renewal of licence of intermediaries or 

insurance intermediaries under sub-section (3) of section 42D; 

(s)  the  requisite  qualifications  and  practical  training  of  intermediaries  or  insurance 

intermediaries under clause (e) of sub-section (5) of section 42D; 

(t)  the  examination  to  be  passed  to  act  as  an  intermediary  or  insurance  intermediary  under 

clause (f) of sub-section (5) of section 42D; 

(u) the code of conduct under clause (g) of sub-section (5) of section 42D; 

(v) the fee for issue of duplicate licence under sub-section (7) of section 42D; 

(w)  such  matters  as  specified  under  sub-section  (2)  of  section  64UB  relating  to  the  Tariff 

Advisory Committee; 

(x)  the  matters  relating  to  licensing  of  surveyors  and  loss  assessors,  their  duties, 

responsibilities and other professional requirements under section 64UM; 

(y) such other asset or assets as may be specified under clause (h) of sub-section (1) of section 

64V for the purposes of ascertaining sufficiency of assets under section 64VA; 

(z) the valuation of assets and liabilities under sub-section (3) of section 64V; 

(za) the matters specified under sub-section (1A) of section 64VA relating to sufficiency of 

assets; 

(zb) the matters relating to re-insurance under sections 101A and 101B; 

(zc) the matters relating to redressal of grievances of policy-holders to protect their interest 

and to regulate, promote and ensure orderly growth of insurance industry; and 

(zd)  any  other  matter  which  is  to  be,  or  may  be,  specified  by  the  regulations  made  by  the 

Authority or in respect of which provision is to be made or may be made by the regulations. 

(3) Every regulation made under this Act shall be laid, as soon as may be after it is made, before each 
House of Parliament, while it is in session, for a total period of thirty days which may be comprised in 
one session or in two or more successive sessions, and if, before the expiry of the session immediately 
following the session or the successive sessions aforesaid, both Houses agree in making any modification 
in  the  regulation  or  both  Houses  agree  that  the  regulation  should  not  be  made,  the  regulation  shall 
thereafter have effect only in such modified form or be of no effect, as the case may be; so, however, that 
any such modification or annulment shall be without prejudice to the validity of anything previously done 
under that regulation.”. 

48.  Section  116A,  for  “Central  Government”,  at  both  places  where  they  occur,  substitute  “Central 
Government, before the date of commencement of the Insurance Regulatory and Development Authority 
Act, 1999,”. 

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THE SECOND SCHEDULE 

(See section 31) 

AMENDMENTS TO THE LIFE INSURANCE CORPORATION ACT, 1956 

(31 OF 1956) 

1. In the Act, for “Controller” wherever it occurs, substitute “Authority”. 

2. After section 30, insert the following:— 

“30A. Exclusive privilege of Corporation to cease.—Notwithstanding anything contained in this 
Act, the exclusive privilege of carrying on life insurance business in India by the Corporation shall 
cease on and from the commencement of the Insurance Regulatory and Development Authority Act, 
1999  and  the  Corporation  shall,  thereafter,  carry  on  life  insurance  business  in  India  in  accordance 
with the provisions of the Insurance Act, 1938 (4 of 1938).”. 

29 

 
 
THE THIRD SCHEDULE 

(See section 32) 

AMENDMENT TO THE GENERAL INSURANCE BUSINESS (NATIONALISATION) ACT, 1972 

After section 24, insert the following:— 

(57 OF1972) 

“24A. Exclusive privilege of Corporation and  acquiring companies to cease.—Notwithstanding 
anything  contained  in  this  Act,  the  exclusive  privilege  of  the  Corporation  and  the  acquiring 
companies  of  carrying  on  general  insurance  business  in  India  shall  cease  on  and  from  the 
commencement  of  the  Insurance  Regulatory  and  Development  Authority  Act,  1999  and  the 
Corporation  and  the  acquiring  companies  shall,  thereafter,  carry  on  general  insurance  business  in 
India in accordance with the provisions of the Insurance Act, 1938 (4 of 1938).” 

30 

 
 
