IAI Actuarial Core Principles · Business Management · Activities of the Institute of Actuaries of India
A newly qualified actuary at a Mumbai life insurer is asked by a colleague why the Institute of Actuaries of India (IAI) matters to the public and not only to its members. Which statement best describes the role of the IAI in serving the public interest?
The IAI regulates the actuarial profession by setting education and professional standards and enforcing conduct, and its members must act in the public interest. It does not fix premiums, license insurers or guarantee claims; those functions sit with insurers and the insurance regulator.
- AIt sets the premium rates that every insurer in India must charge, so that policyholders are protected from price variation
- BIt regulates the actuarial profession, sets education and professional standards, and requires members to act in the public interestCorrect
- CIt supervises the solvency of all insurers and can cancel an insurer's licence directly
- DIt guarantees the payment of policyholder claims if an insurer fails
- It is a government department that issues insurance products on behalf of the State
Explanation
The IAI is the statutory professional body for actuaries in India. It sets education, standards and discipline for members, who are expected to act in the public interest. Setting premium rates, licensing insurers and guaranteeing claims belong to the market, the insurance regulator or other arrangements, not to the IAI.
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