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India – Insurance Snapshots.

29 April, 2014

 


  • On December 3, 2013, the Insurance Regulatory Development Authority (‘IRDA’) notified the Insurance Regulatory and Development Authority (Insurance Brokers) Regulations, 2013 (‘Regulations’) which was placed in the public domain on January 10, 2014. The Regulations supersede the Insurance Regulatory and Development Authority (Insurance Brokers) Regulations, 2002 (‘2002 Regulations’) and introduce certain additional provisions. The key additional stipulations under the Regulations are as follows:

 

i. Prior written approval of the IRDA is now required in cases of the transfer of shares of an insurance broker in excess of certain prescribed limits;
ii. A restriction has been placed on the creation of an encumbrance on the shares of an insurance broker (including by way of a pledge); and
iii. An insurance broker is required to maintain a minimum net worth equal to 100% of the minimum capital or contribution prescribed under the Regulations.

 

  • The Department of Industrial Policy and Promotion has on February 04, 2014 issued press note 2 (2014 Series) amending the Consolidated FDI Policy effective from April 5, 2013 (‘PN 2’). In terms of PN 2, FIIs and Non Resident Indians have been permitted to invest in an insurance company, an insurance broker, third party administrator, and/or surveyors and loss assessors under the automatic route, subject to compliance with the 26% sectoral cap applicable to insurance companies. Prior to the issuance of PN 2, investments in the insurance sector were limited to investments under the FDI route alone.

 

AZB

 

For further information, please contact:

 

Zia Mody, AZB & Partners
zia.mody@azbpartners.com

 

Abhijit Joshi, AZB & Partners 
abhijit.joshi@azbpartners.com


Shuva Mandal, AZB & Partners 

shuva.mandal@azbpartners.com

 

Samir Gandhi, AZB & Partners
samir.gandhi@azbpartners.com


Percy Billimoria, AZB & Partners 

percy.billimoria@azbpartners.com

 

Aditya Bhat, AZB & Partners 
aditya.bhat@azbpartners.com

 

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