NEWSLINKS
BUDGET 2000
BUY BUDGET
Y2K BIZ FEATURES
INDIA & THE W.T.O.
NEW GOVERNMENT
SPECIALS
INTERVIEWS
COMMENTARY
BIZ IN THE USA
CREDIT POLICY
BUDGET 1999-2000
USEFUL INFO
ARCHIVES
SEARCH REDIFF

Insurance regulator to become operational by March 15

As yet another significant step towards opening up the insurance sector, the Insurance Regulatory and Development Authority will be constituted by March 15, IRDA Chairman N Rangachary said in New Delhi on Thursday.

''The IRDA will be established within a fortnight or so,'' he said but did not elaborate whether the government would fully constitute the authority in the very first instance.

The IRDA Act 1999 which got Presidential assent on December 29 last year, provides for a chairman, five full-time members and four part-time members. Currently, IRDA is an interim body with Rangachary as the chairman and H Ansari as a member.

Laying down a timetable, Rangachary said the draft regulations for pricing of products, appointment of actuaries, solvency and means to value instruments would be circulated for comments soon after the IRDA constitution.

Further, prospective insurance companies registered in India can file for registration by June-end 2000 and the first licence will be given sometime between October-November 2000. IRDA plans to give the first licences as ''Diwali Gift'' to the insurance companies, Rangachary said.

He reiterated that international standards would be followed for registration of companies and insurance products. ''The draft regulations will be finalised with the help of an advisory committee,'' he added.

Although IRDA has not set for itself any limit, it will consider the ability and credibility of the applicant while giving licences, Rangachary said. ''We would give licences to those who show long term commitment. It would not be a composite licence for life and non-life insurance.''

Any prospective insurance player willing to enter both life and general insurance will have to form two separate companies with a paid-up capital of Rs 1.20 billion each and submit two applications for the same.

Planning Commission member Montek Singh Ahluwalia said that general public should be allured to insurance products because of their attractiveness and not due to tax concessions.

The new competitive environment for insurance will bring in a lot of new products and importance of asset management will increase, he added.

UNI

Business