IRDAI Current Affairs - 2019
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The Insurance Regulatory and Development Authority of India (IRDAI) set up Suresh Mathur Committee to review regulatory framework on micro insurance, and to recommend measures to increase demand for such products. It was formed because of less than desired offtake of micro insurance products despite of their inherent benefits in the country. India was seen to be an exciting market and a pioneer in micro insurance sector in world, but its market penetration remains low.
Suresh Mathur Committee
- Composition: It is a 13-member panel chaired by IRDAI’s Executive Director Suresh Mathur, and comprises of representatives from IRDAI, life, general and health insurance companies in public and private sectors and NGOs.
- Its task is to suggest product designs with customer-friendly underwriting, such as easy premium payment methods and simple claims settlement procedures.
- It will suggest about if there is any change in distribution structure, including mobile-based and technology driven solutions and on creating effective awareness programmes.
- Their recommendations are to submitted within three month time frame.
- IRDAI created a special category of insurance policies called micro-insurance policies (a General or Life Insurance policy with a sum assured of Rs 50,000 or less) to promote insurance coverage among economically vulnerable sections of society. The micro-insurance is defined and enabled by IRDAI Micro-insurance Regulations, 2005.
- General Micro-Insurance product is a Health insurance contract that covers belongings like Hut, Livestock, tools or instruments or any personal accident contract and is either on an individual or group basis.
- Life Micro-Insurance product is a term insurance contract with or without return of premium, any endowment insurance contract or health insurance contract. It with or without an accident benefits rider and is either on an individual or group basis. There is flexibility in regulations for insurers.
- Micro- Insurance Business is done by intermediaries such as Non-Government Organisations (NGOs) and Self-Help Groups (SHGs).
- Micro insurance Benefits- They are specifically intended for protection of low-income people, with affordable insurance products, and micro insurance promises to support sustainable livelihoods of poor.
The Union Cabinet headed by Prime Minister Narendra Modi has approved setting up of a unified authority for regulating all financial services in international financial services centres (IFSCs) in the country. The government has approved a bill to set up a unified regulator.
The first IFSC in India was set up at GIFT City in Gandhinagar, Gujarat.
Promoting the Ease of Doing Business
IFSCs are set-up to bring back the financial services and transactions that are currently carried out in offshore financial centres by Indian corporate entities and overseas branches or subsidiaries of financial institutions (FIs) to India.
In order to ensure this, the business and regulatory environment must be comparable to other leading international financial centres in the world like London and Singapore. Currently, the banking, capital markets and insurance sectors in IFSCs are regulated by multiple regulators like the RBI, SEBI and IRDAI respectively.
For IFSCs to attain its objectives there is a need for inter-regulatory coordination. The establishment of a unified financial regulator for IFSCs will result in providing a world-class regulatory environment to market participants from the ease of doing business perspective.
For the setting up of a unified regulator, the Union cabinet has approved the International Financial Services Centres Authority Bill, 2019.