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

A life insurer, Kaveri Life Ltd., is delaying death claims in a manner likely to prejudice life policyholders. After giving it an opportunity to be heard, what may the Authority do under section 52A?

The Authority may appoint an Administrator to manage the insurer's affairs under its direction and control. Section 52A permits this for a life insurer acting prejudicially to life policyholders, after the insurer has been given an opportunity of being heard.

  1. AAppoint an Administrator to manage the insurer's affairs under the Authority's direction and controlCorrect
  2. BTransfer all policies to the General Insurance Council
  3. CCancel the claims of all policyholders
  4. DDirect the Executive Committee of the General Insurance Council to run the insurer

Explanation

Section 52A allows the Authority, if it believes a life insurer is acting prejudicially to life policyholders, to appoint an Administrator after giving the insurer an opportunity to be heard. The Administrator works under the Authority's direction and control and is paid remuneration as the Authority directs. The General Insurance Council concerns general insurers only.

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