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Consider the following statements regarding the Insurance Regulatory and Development Authority of India (IRDAI):
- It is a statutory body formed for the overall supervision of the Insurance sector in India.
- It regulates both public and private sector General Insurance Companies.
Which of the statements given above is/are correct?
- a)1 only
- b)2 only
- c)Both 1 and 2
- d)Neither 1 nor 2
Correct answer is option 'C'. Can you explain this answer?
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Most Upvoted Answer
Consider the following statements regarding the Insurance Regulatory a...
The Insurance Regulatory and Development Authority of India (IRDAI) is planning to unveil a host of new measures, including 100 per cent cashless claim settlement in health cover.
About Insurance Regulatory and Development Authority of India (IRDAI):
- It is a statutory body formed under an Act of Parliament, i.e., Insurance Regulatory and Development Authority Act, 1999 (IRDAI Act 1999) for overall supervision and development of the Insurance sector in India.
- It is also responsible for registering and/or licensing insurance, reinsurance companies and intermediaries according to the regulations.
- Entities regulated by IRDAI:
- Life Insurance Companies - Both public and private sector Companies
- General Insurance Companies - Both public and private sector Companies. Among them, there are some standalone Health Insurance Companies which offer health Insurance policies.
- Re-Insurance Companies
- Agency Channel
- Intermediaries which include the following:
- Corporate Agents
- Brokers
- Third Party Administrators
- Surveyors and Loss Assessors.
- Composition: It is a 10-member body- a chairman, five full-time members and four part-time members appointed by the Government of India.
- To protect the interests of policyholders, the IRDAI was granted significant responsibilities including
- Efficiently conducting insurance business and protecting the interests of the policyholders in matters concerning assigning of policy, nomination by policyholders, insurable interest, settlement of insurance claim, surrender value of the policy and other terms and conditions of contracts of insurance.
- Approving product terms and conditions offered by various insurers.
- Regulating investment of funds by insurance companies and maintaining a margin of solvency.
- Specifying financial reporting norms of insurance companies.
- Ensuring insurance coverage is provided in the rural areas and also to the vulnerable sections of society.
- IRDAI’s Head Office is at Hyderabad.
Hence both statements are correct.
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Community Answer
Consider the following statements regarding the Insurance Regulatory a...
The correct answer is option 'C' - Both 1 and 2.
Explanation:
1. It is a statutory body formed for the overall supervision of the Insurance sector in India:
- The Insurance Regulatory and Development Authority of India (IRDAI) is a statutory body established under the Insurance Regulatory and Development Authority Act, 1999. The act was passed by the Parliament of India to provide for the establishment of an authority to protect the interests of policyholders, regulate, promote, and ensure the orderly growth of the insurance industry in India.
- The IRDAI is responsible for the supervision and regulation of the insurance sector in the country. It functions as an autonomous body and operates under the Ministry of Finance, Government of India. Its primary objective is to promote the development and regulation of the insurance industry, protect the interests of policyholders, and ensure the stability and financial soundness of insurance companies.
2. It regulates both public and private sector General Insurance Companies:
- The IRDAI regulates both public and private sector general insurance companies in India. General insurance includes non-life insurance products such as motor insurance, health insurance, property insurance, travel insurance, etc.
- The IRDAI formulates regulations and guidelines for the operation of general insurance companies, including licensing and registration requirements, solvency norms, investment guidelines, and consumer protection measures.
- It also supervises the operations of general insurance companies, monitors their financial performance, and takes necessary actions to ensure their compliance with the regulatory framework.
- The IRDAI plays a crucial role in safeguarding the interests of policyholders by ensuring fair practices, transparency, and efficient claim settlement processes in the general insurance sector.
In conclusion, both statements are correct. The IRDAI is a statutory body formed for the overall supervision of the insurance sector in India, and it regulates both public and private sector general insurance companies.
Explanation:
1. It is a statutory body formed for the overall supervision of the Insurance sector in India:
- The Insurance Regulatory and Development Authority of India (IRDAI) is a statutory body established under the Insurance Regulatory and Development Authority Act, 1999. The act was passed by the Parliament of India to provide for the establishment of an authority to protect the interests of policyholders, regulate, promote, and ensure the orderly growth of the insurance industry in India.
- The IRDAI is responsible for the supervision and regulation of the insurance sector in the country. It functions as an autonomous body and operates under the Ministry of Finance, Government of India. Its primary objective is to promote the development and regulation of the insurance industry, protect the interests of policyholders, and ensure the stability and financial soundness of insurance companies.
2. It regulates both public and private sector General Insurance Companies:
- The IRDAI regulates both public and private sector general insurance companies in India. General insurance includes non-life insurance products such as motor insurance, health insurance, property insurance, travel insurance, etc.
- The IRDAI formulates regulations and guidelines for the operation of general insurance companies, including licensing and registration requirements, solvency norms, investment guidelines, and consumer protection measures.
- It also supervises the operations of general insurance companies, monitors their financial performance, and takes necessary actions to ensure their compliance with the regulatory framework.
- The IRDAI plays a crucial role in safeguarding the interests of policyholders by ensuring fair practices, transparency, and efficient claim settlement processes in the general insurance sector.
In conclusion, both statements are correct. The IRDAI is a statutory body formed for the overall supervision of the insurance sector in India, and it regulates both public and private sector general insurance companies.
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Consider the following statements regarding the Insurance Regulatory and Development Authority of India (IRDAI): It is a statutory body formed for the overall supervision of the Insurance sector in India. It regulates both public and private sector General Insurance Companies.Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'C'. Can you explain this answer?
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