Consultancy firm may be appointed by insurance councils to recommend changes in regulations

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By Venkatachari Jagannathan
Chennai, May 12 |
The insurance regulations in India are set for a major overhaul with the two industry bodies likely to hire a consultancy firm to recommend regulatory changes, said senior industry officials.

The two industry bodies are – Life Insurance Council and General Insurance Council.

Industry officials told IANS preferring anonymity that the new Chairman of the Insurance Regulatory and Development Authority of India (IRDAI) Debasish Panda at his meeting with the sectoral officials had said the two Councils should turn vibrant.

It is learnt Panda had told them that the Insurance Information Bureau (IIB) should ideally be part of the Councils as it collects the data from the industry to come out with research reports.

Similarly, the Institute of Insurance and Risk Management (IIRM) should also be part of the industry and not that of the regulator.

A media statement from IRDAI had said: “It was proposed to revamp the role and functioning of the Life Insurance and General Insurance Councils, to make them more vibrant bodies. Role of Insurance Information Bureau of India (IIB) in supporting data and tech-driven insurance solutions was also discussed.”

“To take these ideas forward and also come out with recommendations for overhaul of the regulations, the two Councils may have to hire a consultancy firm,” officials told IANS.

The consultancy fee would be shared by both the Councils.

“How the fee would be shared by the members of the Councils-insurers- has to be seen. Whether it would be shared in the ratio of their gross premium or equally will have to be decided,” a senior industry official told IANS.

Already several groups have been formed in the life/non-life/reinsurance to study the existing regulations and come out with recommendations on them.

IRDAI Chairman Panda had told the insurers that every Indian should have a life insurance policy; every family a health insurance family and every bread winner should have an accident insurance policy.

At its meeting with the industry officials, IRDAI said it had displayed firm commitment to carry out reforms which will lead to the objective of “Insurance for all” by 2047.

“These reforms, among others, include promoting ease of doing business by encouraging new insurance players, allowing niche players in insurance, relaxing renewal norms for intermediaries,” product certification by insurers, time-bound approvals, administrative flexibility, fast-track approvals for investment proposals, facilitating InsurTech and distribution agility,” IRDAI had said.

The IRDAI also has plans to make the regulations lighter and reduce the compliance burden on the insurers.

“Additionally, the need for risk based capital and solvency, convergence to Ind-AS, rationalising expenses of management, developing talent pool, updating investment norms and sustainable growth of industry were also deliberated,” IRDAI said after its meeting with industry officials.

The two councils may soon come out with a request for proposal for interested consultancy firms to bid for the project.

(Venkatachari Jagannathan can be reached at v.jagannathan@ians.in)

Source: IANS

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Share Market Closing Bell: Market ends the week in green, Sensex surges 1,534 pts and Nifty sinks below 15,850

Share Market Closing Bell: Market ends the week in green, Sensex surges 1,534 pts and Nifty sinks below 15,850

The NIFTY 50 recouped the previous day’s losses and ended at 2.89 percent higher on strong global cues after China cut key lending rates. Nifty continued its upside rally throughout the day as it ended at 16266.15 levels. Bank nifty closed the session at 34276.40 level with a gain of 960 points. VIX closed at 23.10 down by 5.94%.

48 stocks out of NIFTY 50 closed in green which suggest broad based buying. All the sectoral indices are trading higher with metal, pharma, PSU bank and realty indices up 2-3 percent each. Stocks like DRREDDY, JSWSTEEL, NESTLEIND, TATAMOTORS & TATASTEEL were the top gainers, While SHREECEM & UPL were only two losers. The Nifty has formed Open Bullish Marabozu on a daily time frame which indicates upside momentum for an upcoming session.

Moreover, Nifty has been trading in a range of 15750-16410 levels throughout the week, crossing either side can direct further direction. In addition, Nifty has given a closing above 9-Day Moving Average which indicates a bounceback from lower levels can be seen.

However, the momentum indicators MACD & Stochastic were trading witha positive crossover & reversed from oversold zone on an hourly chart which suggest a northward journey in Nifty. The Nifty may find Strong support around16000 levels, while on the upside 16410 may act as an immediate hurdle. On the other hand, Bank nifty has support at 33200 levels while resistance at 34800levels.

Palak Kothari
Research Associate
Choice Broking

Source: Choice India

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