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CS Professional · Banking and Insurance - Laws and Practice · Regulatory Framework in Insurance

Nirmaan Advisory Pvt. Ltd., which is not an insurer, plans to use the word 'Assurance' in its business name to attract customers, though it only sells software. Under section 2C(4) of the Insurance Act, 1938 as inserted in 2025, what is the position?

It may not use the word. Section 2C(4) bars any person other than an insurer from using words such as insurance or assurance in its name or business. Intermediaries and associations have limited permissions only to indicate their nature, which does not cover a software firm.

  1. AIt may use the word freely
  2. BIt may use it only if it pays a fee
  3. CIt may use it if it is registered under the Companies Act
  4. DNo person other than an insurer may use such words as part of its name or in connection with its businessCorrect

Explanation

Section 2C(4) prohibits any person other than an insurer from using 'insurance', 'insurer', 'assurance', 're-insurance', 'insurance company' or their derivatives in its name or business. Companies Act registration gives no exception; only intermediaries and associations may use limited words under sub-sections (5) and (6).

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