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CS Professional · Banking and Insurance - Laws and Practice · General and Health Insurance

Nirmaan Re Ltd is a re-insurer. Its CS is asked to advise on whether Section 32D applies to it. What is the correct advice?

Advise that the obligation exists, but the Authority may exempt a re-insurer through regulations. Section 32D's proviso expressly lists re-insurance among the businesses eligible for exemption, so the outcome depends on those regulations rather than an automatic exclusion or a Council decision.

  1. ASection 32D never applies to re-insurers under any circumstances
  2. BSection 32D applies, but the Authority may by regulations exempt an insurer primarily engaged in re-insuranceCorrect
  3. CSection 32D applies and no exemption exists for re-insurers
  4. DOnly the General Insurance Council can decide the matter

Explanation

The obligation applies to general insurers, but the proviso lets the Authority exempt insurers primarily engaged in re-insurance, among others, by regulations. So the exemption depends on the Authority's regulations, not an absolute rule or a Council decision.

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