PRACTISE OF GENERAL INSURANCE

THE ORIGIN OF INSURANCE:

It had its origin in the form of BOTTOMRY BONDS. BOTTOMERY

LOAN was an advance money on a ship during period of voyage. Loans

granted on the security of Cargo were called RESPONDENITA BONDS

The origin of insurance can be traced back to the fourth century B.C. in the

'bottomry bonds' which were issued by the Mediterranean merchants

In India, nationalisation of life insurance companies took place in 1956 and

that of the general insurance companies in 1972. But in 2000 reforms were

initiated by the Government and the insurance sector was liaeralised and

opened up to private and foreign players.

During the nationalisation era the non-life insurance landscape was

dominated by the four public sector insurers with GIC as their holding

company. In 2000, GIC's role was changed to national re-insurer and its

four subsidiaries were restructured as independent companies.

1938: THE INSURANCE ACT WAS INTRODUCED IN THE YEAR 1938

AND ITS RULES WERE INTRODUCED IN THE YEAR 1939.

1956: IT WAS IN THE YEAR 1956, THE INDIAN GOVT TOOK OVER

ALL THE INSURANCE COMPANIES UNDER THE LIFE INSURANCE

CORPORATION ACT 1956

1968 FIRST AMENDMENT IN THE ACT TO PROVIDE SOCIAL

CONTROL, MINIMUM SLOVENCY MARGIN AND TAC

1971: THE GENERAL INSURANCE (EMERGENCY PROVISIONS)

MANAGEMENT AND OWNERSHIP WERE TRANSFERRED TO THE

INDIAN GOVT.

1972: THE GENERAL INSURANCE BUSINESS (NATIONALIZATION)

ACT.

1973: GENERAL INSURANCE CORPORATION (GIC) CAME IN

EXISTANCE

1991: PUBLIC LAIBILITY ACT AND PUBLIC LAIBILITY RULES

1994: MALHOTRA COMMITTEE HEADED BY R.N.MALHOTRA

1998: INSURANCE OMBUSMAN REDRESSEL OF PUBLIC

GRIVANCES RULES
1999: IRDA

2001: PRIVATE SECTOR COMPANIES WERE LICENSED

2003: INTRODUCTION OF BROKER

2015: INSURANCE LAWS AMENDMENT ACT 2015 HAS

AMENDMENT THE INSURANECE ACT 1938, GIBNA, IRDA

HEAD QUARTERS:

NATIONAL INSURANCE COMPANY AT KOLKATTA

THE NEW INDIA ASSURANCE COMPANY LTD AT MUMBAI

THE ORIENTAL FIRE AND GENERAL INSURANCE LTD AT DELHI

UNITED INDIA FIRE AND GENERAL INSURANCE COMPANY AT

CHENNAI

INSURED IS ANY PERSON OR ORGANISATION WHO BUYS AN

INSURANCE POLICY

INTEREMEDIARIES ARE THE PERSONS WHO SELL THE POLICY

INSURER IS THE ORGANISATION THAT OFFERS AND PROVIDE

THE CAPITAL AND PRODUCTS FOR INSURANCE PROTECTION

I R D A ESTD UNDER IRDA ACT HAS TO REPORT TO MINISTRY

OF FINANCE

NOTE: IN PRIVATE INSURNCE COMPANY THE FOREIGN’S

PARTNER STAKE IS RESTRICTED TO MAXIMUM 49%

BROKERS:

1. DIRECT BROKERS

2. REINSURANCE BROKERS

3. COMPOSITE BROKER

NATIONAL INSURANCE ACADAMY ESTD IN 1980 AND IT IS

GOVERENED BY LIC/GIC OF INDIA

GENERAL INSURANCE COMPANIES

I. COMOPANY CONDUCTING ALL LINES OF BUSINESS

II. HEALTH INSURANCE COMPANIES- 1998

III. AGRICULTURE INSURANCE COMPANIES-ESTD IN 2002

AND INTRO IN 2003

IV. CREDIT INSURANCE COMPANY-1957

V. RE-INSURANCE CO.

VI. STATE GOVT INSURANCE DEPT/FUNDS

G.I.C REMANAGES THE INDIAN INSURANCE POOLS ON BEHALF

OF THE INDUSTRY

A. MARINE HULL POOL

B. TERRORISM POOL

C. INDIAN MOTOR THIRD PARTY INSURANCE POOL

GIC IS THE ONLY COMPANY LICENSED BY IRDA TO CONDUCT

RE-INSURANCE BUSINESS

SALIENT FEATURES OF INDIAN GENERAL INSURANCE:

A. IRDAI IS THE SOEL AUTHORITY OF INSURANCE BUSINESS

LIFE AND NON-LIFE

B. COMPOSITE INSURANCE COMPANY CONDUCTING LIFE

AND NON-LIFE INSURANCE NOT ALLOWED

C. NON-ADMITTED INSURANCE NOT PERMITTED

D. ANY PROPERTY SITUATED IN INDIA OR TO BE SITUATED IN

INDIA HAS TO BE INSURED WITH INDIAN INSURANCE CO.

E. CASH AND CARRY MARKET I.E. COVER COMMENCES ONLY

ON PAYMENT OF PREMIUM.

F. RETAIL AND DIRECT BROKING PERMITTED.