04
RBI
IRDA
SEBI
NHB
PFRDA<br>
06
Meaning
Role & Functions
History & Origin
Structure & Hierarchy
Departments RBI<br>
08
Following the recommendations of the Malhotra Committee report, in 1999, the Insurance Regulatory and Development Authority (IRDA) was constituted as an autonomous body to regulate and develop the insurance industry.
The IRDA was incorporated as a statutory body in April, 2000.
IRDA (Insurance Regulatory and Development Authority) is the national regulatory body for Insurance industry (both Life and Non-Life Insurance Companies) under the Government of India, situated at Hyderabad.<br>
09
Head Office in Hyderabad<br>
10
The key objective of the IRDA includes promotion of competition so as to enhance customer satisfaction thru increased consumer choice and lower premiums, while ensuring the financial security of the insurance market.
The IRDA opened up the market in August 2000 with the invitation for application for registrations.<br>
11
As per the section 4 of IRDA Act' 1999, Insurance Regulatory and Development Authority specify the composition of Authority The Authority is a ten member team consisting of : (a) a Chairman; (b) five whole-time members; (c) four part-time members, (all appointed by the Government of India) Composition<br>
12
The whole time members shall hold office for 5yrs or until the age of 62 which ever is earlier.
The chairman shall hold the office for 5 yrs until the age of 65 yrs whichever is earlier.
The part time members will hold the office for not more than 5 yrs.
The above said members are to be appointed by the central government from among the persons of ability and standing who have knowledge or experience in life insurance, general insurance, actuarial science, finance, economics, law, accountancy, administration or any other discipline which would, in the opinion of central government.<br>
13
To take care of the policyholders interest.
To open up the insurance sector for private sector.
To ensure continued financial soundness and solvency.
To regulate insurance and reinsurance companies.
To eliminate dishonesty and unhealthy competitions.
To supervise the activities of intermediaries in insurance sector.
To amend the Insurance Act 1938 and LIC Act 1956 and General Business Nationalisation Act, 1972. Objectives of IRDA<br>
14
Protection of the interests of the policy holders in matters concerning assigning of policy, nomination by policy holders, insurable interest, settlement of insurance claim, surrender value of policy and other terms and conditions of contracts of insurance;
Settlement of disputes b/w insurers and intermediaries.
Issuing certificate of registration, renew, modify, withdraw, suspend or cancel the same.
Specifying the form and manner in which books of accounts are to be maintained by insurers and other insurance intermediaries. Powers, duties, functions of IRDA<br>
15
Control and regulate rates, terms & conditions that may be offered by insurers in respect of General Insurance.
Specifying qualifications, code of conduct and training for insurance intermediaries, agents, surveyors and loss assessors.
Inspecting and investigating operations of insurance companies including audit of the insurers, intermediaries and other organisations connected with the insurance business.
Regulating investment of funds by insurance companies, maintenance of margin of solvency.<br>
16
Specifying the percentage of Rural or Social sector life insurance business and general insurance business which needs to be undertaken by the insurers.
IRDA promotes and regulates organisations connected with the insurance and the re -insurance business.<br>
20
SEBI was established as a non-statutory board in 1988 and in January 1992 it was made a Statutory body. The main objectives of SEBI are :
Investor protection, so that there is a steady flow of savings into the Capital Market.
Ensuring the fair practices by the issuers of securities, namely, companies so that they can raise resources at least cost.
Promotion of efficient services by brokers, merchant bankers and other intermediaries so that they become competitive and professional. SEBI<br>
21
In 2002, SEBI is further empowered to do the following:-
1. To file complaints in courts and to notify its regulations without prior approval of government.
2. To regulate issue of capital and transfer of securities.
3. To impose monetary penalties on various intermediaries and other participants for a specified range of violations.
4. To issue direction to and to call for documents from all intermediaries.<br>
22
The SEBI performs functions to meet its objectives. To meet the objectives, SEBI has three important functions. These are:
i. Protective functions
ii. Developmental functions
iii. Regulatory functions. Functions of SEBI:<br>
23
These functions are performed by SEBI to protect the interest of investor and provide safety of investment:
It Checks Price Rigging
It Prohibits Insider trading
SEBI prohibits fraudulent and Unfair Trade Practices
SEBI undertakes steps to educate investors so that they are able to evaluate the securities of various companies and select the most profitable securities. Protective Functions:<br>
24
SEBI promotes fair practices and code of conduct in security market by taking following steps:
SEBI has issued guidelines to protect the interest of debenture-holders wherein companies cannot change terms in midterm.
SEBI is empowered to investigate cases of insider trading and has provisions for stiff fine and imprisonment.
SEBI has stopped the practice of making preferential allotment of shares unrelated to market prices.<br>
25
These functions are performed by the SEBI to promote and develop activities in stock exchange and increase the business in stock exchange.
(i) SEBI promotes training of intermediaries of the securities market.
(ii) SEBI tries to promote activities of stock exchange by adopting flexible and adoptable approach in following way:
(a) SEBI has permitted internet trading through registered stock brokers.
(b) SEBI has made underwriting optional to reduce the cost of issue.
(c) Even initial public offer of primary market is permitted through stock exchange. Developmental Functions:<br>
26
These functions are performed by SEBI to regulate the business in stock exchange.
SEBI has framed rules and regulations and a code of conduct to regulate the intermediaries such as merchant bankers, brokers, underwriters, etc.
These intermediaries have been brought under the regulatory purview and private placement has been made more restrictive. Regulatory Functions<br>
27
SEBI registers and regulates the working of stock brokers, sub-brokers, share transfer agents, trustees, merchant bankers and all those who are associated with stock exchange in any manner.
SEBI registers and regulates the working of mutual funds etc.
SEBI regulates takeover of the companies.
SEBI conducts inquiries and audit of stock exchanges.<br>
28
Refer to page no 71 The Organisational Structure of SEBI<br>
29
Head office of SEBI : Bandra Kurla Complex, Mumbai<br>
30
National Housing Bank<br>
