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CS Professional · Banking and Insurance - Laws and Practice · Life Insurance

Before the Insurance Regulatory and Development Authority Act, 1999 came into force, Sarvodaya Mutual Ltd, a private insurer, held a registration under the Insurance Act, 1938 for life insurance. Under Section 30 of the LIC Act, 1956, what was the effect on its certificate of registration from the appointed day (1956)?

The certificate ceased to have effect so far as it authorised life insurance business in India, because Section 30 of the LIC Act gave LIC the exclusive privilege from the appointed day. The Act provided no transition period, group-policy exception or conversion into an agency.

  1. AIt ceased to have effect insofar as it authorised life insurance business in IndiaCorrect
  2. BIt continued in force for ten more years
  3. CIt continued, but only for group policies
  4. DIt was converted automatically into a licence as an LIC agent

Explanation

Section 30 gave LIC the exclusive privilege of life insurance business from the appointed day. Any certificate of registration held by an insurer under the Insurance Act ceased to have effect in so far as it authorised life insurance business in India. No transition period or conversion was provided.

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