Report No. 190

Revision of The Insurance Act, 1938 and The Insurance Regulatory and Development Authority Act, 1999

Contents
Chapter I	Introduction and Background
1.1	Introduction
2.	Legislative Regime
3.	Background to recent legislative changes
	Malhotra Committee Report
4.	Regulatory Legal Regime
	Powers and functions of the IRDA
5.	Legislative developments after 1999
6.	Law Commission's Consultation Paper
7.	Limiting the scope of the reference
Chapter II	Changes in Definitions and Deletion of Redundant Provisions
	Changes in Definitions and Deletion of Redundant Provisions
	Final recommendation of the Law Commission in relation to deletions
	Deletion of provisions of the Insurance Act, 1938 that are redundant
Chapter III	Merger of Provisions of Irda Act, 1999 with The Insurance Act, 1938
	Merger of Provisions of Irda Act, 1999 with The Insurance Act, 1938
Chapter IV	Grievance Redressal Mechanism
	Consultation Paper
	Response to the Consultation Paper
	Law Commission's views on the responses
	Final recommendations of the Law Commission in regard to Grievance Redressal Mechanism
Chapter V	Legal Issues Requiring Reform in Insurance Laws: Repudiation of Life Insurance Policy
	The existing law
	The principle of uberrimae fidei
	Decisions of Indian courts
	Law Commission's earlier recommendation
	Law Commission's Suggestion in the Consultation Paper
	Response to the Proposal in the Consultation Paper
	Views of the Law Commission
	Final recommendations in regard to section 45
	Suggested amendment of section 45
Chapter VI	Assignment and Transfer
	Existing Law
	Proposals in the Consultation Paper
	Response to the Proposal in the Consultation Paper
	Views of the Law Commission
	Final recommendations of the Law Commission in regard to Section 38
	Suggested amendment of Section 38
Chapter VII	Nomination
	Nomination
	Law Commission's earlier recommendation
	Responses to the Consultation Paper
	The Law Commission's views
	Final recommendations of the Law Commission in regard to Section 39
	Suggested amendment of Section 39
Chapter VIII	Provisions Relating to Penalties and other Changes
	Provisions Relating to Penalties and other Changes
	Final recommendation of the Law Commission in regard to penalties and other provisions
Chapter IX	Other Topics in The Consultation Paper on which The Law Commission Does not Propose to make any Recommendation at This Stage
	Other Topics in The Consultation Paper on which The Law Commission Does not Propose to make any Recommendation at This Stage
	Insurance Surveyors
	Response to the proposal
	Law Commission's response
	Provisions relating to investments
	Provisions relating to tariffs
	Shareholder's funds and policyholder's funds
Chapter X	Summary of Recommendations
	Summary of Recommendations (1)
	Summary of Recommendations (2)
Appendix I	Consultation Paper of The Law Commission of India on Revision of The Insurance Act 1938
	Need for and grounds of revision of the Insurance Act, 1938
	Some tentative grounds of revision
	Plan of revision of the provisions of the Insurance Act, 1938
	Proposals for revision
	Changes in definitions, deletions and other amendments
	Powers of the IRDA
	Obligations of the insurers under the Act
	Interests of the policyholders
	Tariff Advisory Committe.- composition and powers
(i)	Power to control rates, advantages, terms and conditions in respect of risk other than life
(ii)	Power of TAC to require information
(iii)	Power of the TAC to constitute Regional committee
(iv)	Power to make rules
	Machinery for redressal of grievances/ claims
	The protection of policyholders interests Regulations
	Other mechanisms
	SEBI model
	Recommendation
	Penal provisions
	Miscellaneous provisions
	Investments
	Winding up by the court (Section 53)
	Voluntary winding up (Section 54)
	Scheme for partial winding up (Section 58)
	Management by administrator (Sections 52A-52G)
	Powers of the administrator respecting property (Section 52BB)
	Termination of appointment of administrator (Section 52 D)
	Penalty for withholding documents of property from Administrator (Section 52 F)
	Protection of Action (Section 52G)
	Finality of decision appointing Administrator (Section 52E)
	Powers of the central government to acquire the undertaking of insurers in certain cases
	Return of deposits (section 59)
	Special provisions relating to external companies (Sections 62-64)
	Acquisition of surrender values by policy (Section 113)
	Exemptions (section 118)
Appendix-II	Provisions that required to be amended (other than those concerning powers of the IRDA)
	Provisions that required to be amended
Appendix-III	Provisions that have become redundant and required to be deleted
	Provisions that have become redundant and required to be deleted
Appendix-IV	Proposals with regard to merger of provisions of the IRDA Act, 1999 with the Insurance Act, 1938
	Proposals with regard to merger of provisions of the IRDA Act, 1999 with the Insurance Act, 1938
Appendix-V	Changes in relation to the Powers and functions of the IRDA with regard to grant of registration and refusal, cancellation, suspension, and renewal of registration
	Changes in relation to the Powers and functions of the IRDA with regard to grant of registration and refusal, cancellation, suspension, and renewal of registration
Appendix-VI	Changes in relation to the powers and functions of the IRDA other than those with regard to grant of registration etc. set out in Appendix- V above
	Changes in relation to the powers and functions of the IRDA other than those with regard to grant of registration etc. set out in Appendix- V above