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CS Professional · Banking and Insurance - Laws and Practice · Functions in Insurance and Compliance related thereto (Part II)

A general insurer is repeatedly rejecting genuine claims in a manner that harms policyholders. The Executive Committee of the General Insurance Council learns of this. Which function under the Insurance Act, 1938 does it exercise by reporting the matter to the Authority?

The Executive Committee of the General Insurance Council brings to the Authority's notice any general insurer acting prejudicially to policyholders' interests. This is a reporting function under section 64L(1)(c). It does not itself cancel registration or fix premiums.

  1. ABringing to the notice of the Authority the case of an insurer acting prejudicially to the interests of general insurance policyholdersCorrect
  2. BAdvising the Authority on controlling the insurer's commission expenses
  3. CFixing the premium rates payable by the insurer's policyholders
  4. DCancelling the insurer's registration directly

Explanation

Section 64L(1)(c) empowers the Executive Committee to bring to the Authority's notice any such insurer acting in a matter prejudicial to policyholders' interests. Advice on expenses is a separate function under clause (b). The Committee has no power to cancel registration.

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