The insurance regulatory reforms in early 2015 increased the
permitted equity investment of foreign insurers from 26% to 49%.
However, insurers and intermediaries will now need to demonstrate
"Indian control" of the company. The regulator has
clarified the requirement to mean that entities in the insurance
sector must be primarily driven by their boards where majority
voting power lies in the hands of nominee directors of Indian
entities. Foreign partners will need to find innovative ways to
maximise control and protect their investment – possibly
leading to the restructuring of a number of joint ventures.
New regulations on branches of foreign reinsurers have
introduced an order of preference system which requires Indian
insurers to offer risks to entities holding a higher preference
before approaching those lower down the ranking. This will mean
that a certain category of foreign branches will be on a par with
Indian reinsurers, while non-admitted foreign reinsurers without
Indian branches will be squeezed out over time. However, reinsurers
with branches will undoubtedly benefit in terms of seeing quality
risks. This increased competition will benefit the industry
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
To print this article, all you need is to be registered on Mondaq.com.
Click to Login as an existing user or Register so you can print this article.
Health insurance business in India has, traditionally, been regulated by the framework governing general insurance business as issued by the Insurance Regulatory and Development Authority of India (IRDAI)...
The insurance statutory and regulatory framework has,
historically, strictly restricted the amount of commission or
remuneration that can be paid to insurance agents and insurance
intermediaries (such as insurance brokers, corporate agents, web
aggregators and insurance marketing firms) for the solicitation and
procurement of insurance business.
The Insurance Regulatory Development Authority of India ("IRDAI") has, by way of a circular dated 18 May, 2016 issued revised Guidelines for Corporate Governance for insurers in India ("CG Guidelines").
The Insurance Regulatory and Development Authority of India has on December 15, 2015 issued the IRDA (Issuance of Capital by Indian Insurance Companies transacting other than Life Insurance Business) Regulations, 2015.
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).