Insurance Regulatory and Development Authority of India (IRDAI)

In a recent directive, IRDAI sets 3-hour time limit for insurers to clear cashless claims.

1. The Insurance Regulatory and Development Authority of India (IRDAI) has made some major changes in the regulatory norms for health insurance policies.
2. The regulator has issued a comprehensive Master Circular on Health Insurance Products repealing 55 circulars.
3. All the entitlements in a health insurance policy available to a Policyholder have been brought in one place in the Master Circular.

What is IRDAI:

The Insurance Regulatory and Development Authority of India (IRDAI) is a statutory body formed by the Insurance Regulatory and Development Authority Act of 1999. It is responsible for the overall supervision and development of the insurance sector in India.

Head Office: Hyderabad, Telangana.

Objectives of IRDAI:

1. To protect the interests and ensure fair treatment of policyholders.
2. To regulate the insurance industry in a fair manner and ensure its financial soundness.
3. To frame regulations to ensure the industry operates without ambiguity.

Key Functions of IRDAI:

1. Registering and licensing insurance, reinsurance companies, and intermediaries.
2. Setting eligibility criteria, qualifications, and capital requirements for obtaining licenses in the insurance business.
3. Approving product terms and conditions offered by various insurers.
4. Managing insurance company investments while upholding a margin of solvency.
5. Specifying financial reporting norms for insurance companies.
6. Establishing a code of conduct, qualifications, and training requirements for intermediaries and insurance agents.
7. Conducting inspections, calling for information, and conducting investigations, including audits of insurance companies, intermediaries, and other organizations associated with the insurance business.
8. Ensuring insurance coverage is provided in rural areas and to vulnerable sections of society.

Composition of IRDAI:

The IRDAI is a 10-member body comprising a chairperson, 5 full-time members, and 4 part-time members appointed by the Government of India.

Reinsurance Companies:

1. Reinsurance companies, also known as reinsurers, are companies that provide insurance to insurance companies.
2. They play an important role by helping insurance companies transfer risk, reduce capital requirements, and lower claimant payouts.
3. Reinsurers generate revenue by identifying and accepting policies that they consider less risky and reinvesting the insurance premiums they receive.

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