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CS Professional · Banking and Insurance - Laws and Practice · Inspection, Investigation, Penalty and Appellate Procedure

IRDAI considers it expedient to examine the affairs of Suraksha Life Insurance Ltd. Under Section 33 of the Insurance Act, 1938, how does IRDAI start an investigation?

IRDAI begins an investigation by an order in writing that specifies an Investigating Officer, who investigates the insurer's affairs and reports to the Authority. The Act requires no prior tribunal or court approval, and an oral instruction would not meet the written-order requirement.

  1. ABy an order in writing directing a specified Investigating Officer to investigate and report to the AuthorityCorrect
  2. BBy an oral instruction to the insurer's managing director to submit an internal report
  3. CBy obtaining prior approval from the Securities Appellate Tribunal
  4. DBy filing a petition before the High Court seeking leave to investigate

Explanation

Section 33(1) lets the Authority, at any time and if it considers it expedient, direct by order in writing a person specified in the order (the Investigating Officer) to investigate the insurer's affairs and report. No prior approval from the SAT or a court is needed. An oral instruction does not satisfy the requirement of a written order.

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