Have you found yourself wondering about how safe insurance products are? Who can you turn to if you have any grievances? That’s what the IRDA is there for. Read on to find out more.
The insurance industry has evolved to become a sector with many different products ranging from plain vanilla plans to a more wide-ranging plans with multiple features. As the awareness keeps growing about the importance of insurance, thousands of individuals buy insurance products every year. But who regulates this industry and protects investors from malpractices or frauds? That’s what the Insurance Regulatory and Development Authority (IRDA) does in India.
What is IRDA?
IRDA is an autonomous regulatory body that supervises, regulates, and licenses India’s insurance and reinsurance sectors. It came into existence under the Insurance Regulatory and Development Authority Act, 1999. It governs life insurance and general insurance, including health insurance in India.
What are IRDA’s functions?
IRDA’s primary purpose is to protect and look after the interest of insurance policyholders and monitor the happenings in the insurance industry. Its functions and importance in the insurance industry are as follows:
- To ensure fair and just treatment of policyholders in the country.
- To monitor and create regulations for the insurance and reinsurance industry from time to time to prevent any ambiguity.
- To ensure that all players operate within the scope of the Insurance Act.
- To contribute to the growth and expansion of the insurance industry.
- To attend to the grievances of policyholders in case of any trouble, such as preventing frauds and malpractices.
- To settle any disputes arising between insurers, intermediaries and policyholders.
- When applicable, issue registration certificates to insurance companies and renew, modify, withdraw, suspend, or cancel registrations.
- To outline the pertinent qualifications, code of conduct and training practices for insurance agents and intermediaries.
- To promote efficiency in the insurance industry.
- To monitor the books and statements of accounts of different insurance and reinsurance players.
As you can see, the IRDA is the apex insurance body in India. Its role is essential for the orderly functioning of the sector. Not only does it grant licenses and monitor the industry, but also is crucial in managing policyholders’ expectations and interests.
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