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

During a review of underwriting practices, the Executive Committee of the General Insurance Council finds that a general insurer is acting in a manner prejudicial to the interests of general policyholders. What does section 64L require the Committee to do?

The Committee must bring the insurer's case to the notice of the Authority. Section 64L gives it a reporting and advisory role, not a power to penalise, order winding up or refer the matter to the Securities Appellate Tribunal.

  1. AImpose a monetary penalty on the insurer itself
  2. BBring the insurer's case to the notice of the AuthorityCorrect
  3. CDirect the insurer to wind up its general business
  4. DRefer the matter to the Securities Appellate Tribunal

Explanation

Under section 64L(1)(c), the Committee's role is to bring to the notice of the Authority any such insurer acting prejudicially to policyholders. It has no power to penalise or order winding up, and the Tribunal is not the referral point under this section.

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