IRDAI does comprehensive liberalisation of insurance regulations
– Neha Malu, Senior Executive | corplaw@vinodkothari.com
Admittedly with the ambition to develop an economy where every citizen has appropriate life, health and property insurance cover and every enterprise is supported by appropriate insurance solutions, and also to make Indian insurance sector globally attractive, Insurance Regulatory and Development Authority of India (‘IRDAI’) has made comprehensive changes in insurance regulations. IRDAI in its 120th meeting held on 25th November, 2022 had discussed at length the reason behind notifying such changes in IRDAI regulations and the same is expressed to fulfil its objective of achieving ‘Insurance for all by 2047’[1]. All the below discussed amendments were notified vide gazette notification dated 5th December, 2022.
The amendments notified are applicable with immediate effect and are generally speaking in the nature of liberalisation measures. Among the changes, a noteworthy amendment is doing away with obtaining prior approval of IRDAI every time an Insurance company goes for raising money by way of issuance of ‘Other forms of Capital’. Further, the maximum limit of money that can be raised through this route has also been increased which will provide for an easy flow of money into an insurance company. Additionally, allowing a subsidiary company to be a promoter in an insurance company subject to the specified compliances is another significant amendment that has been notified.
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