new Delhi: Sources said the country’s largest insurer LIC may consider the composite license clause after the Insurance Laws (Amendment) Bill is passed in Parliament. As per the proposed Bill, an applicant may apply for registration of one or more classes/sub-categories of insurance business of any class or type of insurer. However, reinsurers are prohibited from registering for any other class of insurance business. A composite license would allow insurers to undertake general and health insurance through a single entity.
Sources said LIC would look into the comprehensive licensing of the Life Insurance Corporation Act, 1956 and other issues arising out of the passage of the Bill. The Bill, along with proposed amendments to the Insurance Act 1938 and the Insurance Regulatory Development Authority Act, 1999, is expected to be tabled in Parliament in the upcoming budget session beginning next month, sources said. ,Also read: LIC is giving Rs 27 lakh for daughter’s marriage; You have to invest just Rs.3600– View details here,
If the proposal for composite insurance registration is passed, there will be a change in the solvency margin and capital requirement for these companies. The proposed amendments suggest that the minimum paid-up capital should be specified by the Insurance Regulatory and Development Authority of India (IRDAI) taking into account the size and scale of operations, class or sub-class of insurance business and class or type of insurer. ,Also read: This post office scheme gives 35 lakh rupees on maturity; Monthly Investment, Return Calculator, Check Policy Terms,
Presently the solvency ratio is pegged at 150 per cent while the paid up capital as per extant law is Rs 100 crore. The Finance Ministry has recently circulated a comprehensive consultation on insurance legislation including reduction in minimum capital requirement with the objective of increasing insurance penetration, improving efficiency and enabling product innovation and diversification.
The proposed amendments primarily focus on promoting policyholders’ interests, improving returns to policyholders, facilitating entry of more players in the insurance market, economic growth and job creation, enhancing efficiency of the insurance industry as well as financial and operational Let’s concentrate. Enabling ease of doing business.