“Insurance Regulatory and Development Authority (Scheme of Amalgamation and Transfer of Life Insurance Business) Regulations, 2013” provides a framework for the amalgamation and transfer of life insurance business in India. Here’s a detailed summary of the regulation:
General Provisions
Title and Commencement: Known as the IRDAI (Scheme of Amalgamation and Transfer of Life Insurance Business) Regulations, 2013, effective from the date of publication in the Official Gazette.
Scope: Applies to all life insurance companies in India. Specific provisions may vary for the Life Insurance Corporation of India due to the Life Insurance Corporation of India Act, 1956.
Definitions
Defines key terms such as “Scheme,” “transferring insurer,” “transferee insurer,” and “appointed date,” ensuring clarity in the implementation of the regulations.
Procedures for Amalgamation and Transfer
Submission of Proposal: Insurers planning to amalgamate or transfer business must submit a detailed proposal to IRDAI, including the draft scheme.
Documents Required: The submission must include financial statements, reports from independent actuaries, and other relevant documents to demonstrate the viability and legality of the proposed scheme.
Approval Process: The scheme must be approved by IRDAI, which will assess factors like solvency margin, compliance with laws, and the interests of policyholders.
Notice and Disclosure
Notice of Intention: Insurers must give a notice of at least two months before submitting the proposal, explaining the nature and reasons for the amalgamation or transfer.
Public Disclosure: The scheme must be published and made available for public inspection, ensuring transparency.
Regulatory Oversight and Safeguards
Authority’s Review: IRDAI will review the proposed scheme to ensure it does not adversely affect the interests of policyholders or the orderly growth of the insurance sector.
Protection of Policyholders’ Interests: Specific requirements to protect policyholders’ interests must be part of the scheme, including how their rights and claims will be handled post-amalgamation or transfer.
Final Approval and Implementation
Conditions for Approval: The scheme must meet various criteria related to financial stability, legal compliance, and policyholder protection.
Effectiveness of the Scheme: The scheme becomes effective only after IRDAI’s approval and subsequent completion of any required legal processes, such as court approval.
These regulations ensure a structured approach to the amalgamation and transfer of life insurance business, emphasizing financial prudence, legal compliance, and the protection of policyholders’ interests.
