What do you mean by an IRDA License?
The insurance sector in our country until 1999, was regulated by the Controller of Insurance under the Insurance Act, 1938. Nevertheless, the formation of IRDA made people feel the requirement of renewal in the arena of insurance. This was because most of the earlier provisions were obsolete or irrelevant in the present context.
Scope of IRDA
The latest IRDA regulation covers the following aspects of importance in the arena of insurance:
- The plan of operation of obtaining license of insurance from IRDA;
- The process of acquiring authorization of insurance products from IRDA; and
- The procedure for appointment of insurance intermediary.
What is the process of granting license to companies to start an insurance business in our country?
It is mandatory for all entities to acquire a Certificate from the Authority before carrying on any insurance business. The license to be acquired for various categories of insurance can be procured from the IRDA, for example Life Insurance, Fire Insurance, Marine Insurance etc. But it is to be kept in mind that the life insurance business shall not be combined with any other type of insurance business.
The license from IRDA is mandatory. Also the old players in the arena of insurance, like the National Insurance, General Insurance, Oriental Insurance etc., had to obtain a fresh certificate within 3 months from the date of commencement of this Act. The insurers exempted from obtaining license under the previous Act, were covered under this Act.