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CMA Final · Risk Management in Banking and Insurance · General Insurance

Under the Insurance Act, 1938, what must every insurer transacting insurance business in India furnish to the Authority regarding expenses of management?

Every insurer must furnish to the Authority the details of its expenses of management, in the manner and form specified by regulations made under the Act. The duty covers management expenses generally, not just commission, and it is a reporting duty, not a prior approval requirement.

  1. AOnly an annual statement of commission paid to agents
  2. BThe details of expenses of management, in such manner and form as specified by regulations under the ActCorrect
  3. CA prior approval request for every expense above a fixed ceiling
  4. DA quarterly statement of claims settled against expenses incurred

Explanation

The Act requires every insurer to furnish the Authority the details of expenses of management in the manner and form specified by regulations. It does not limit this to commission, nor require prior approval of individual expenses or link it to claims settled.

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