THE GAZETTE OF INDIA : EXTRAORDINARY [PART III—SEC. 4]
INSURANCE REGULATORY AND DEVELOPMENT AUTHORITY
NOTIFICATION
New Delhi, the 14th July, 2000
Insurance Regulatory and Development Authority (Actuarial Report and Abstract) Regulations, 2000
F. No. IRDA/Reg./7/2000.—In exercise of the powers conferred by clause (g) of sub-section (2) of section 114A of the Insurance Act, 1938, (4 of 1938), the Authority, in consultation with the Insurance Advisory Committee, hereby makes the following regulations, namely:-
1. Short title and commencement.—(1) These regulations may be called the Insurance Regulatory and Development Authority (Actuarial Report and Abstract) Regulations, 2000.
- (2) They shall come into force from the date of their publication in the Official Gazette.
2. Definitions.—In these regulations, unless the context otherwise requires —
- (a) "Act" means the Insurance Act, 1938(4 of 1938);
- (b) "Authority" means the Insurance Regulatory and Development Authority established under sub-section (1) of section 3 of the Insurance Regulatory and Development Authority Act, 1999 (41 of 1999);
- (c) "extra premium" means a charge for any risk not provided for in the minimum contract premium;
- (d) "group business" means those insurance contracts which are group policies as mentioned under sub-section (2) of section 4 of the Act;
- (e) "guarantees" means the terms in regard to benefits or premiums or charges, which may not be altered during the currency of the policy;
- (f) "individual business" means individual insurance contracts issued on single/joint lives;
- (g) "inter valuation period" means, as respects any valuation, the period to the valuation date of that valuation from the valuation date of the preceding valuation in connection with which an abstract was prepared under the Act or under the enactments repealed by the Act, or, in a case where no such valuation has been made in respect of the class of business in question, from the date on which the insurer began to carry on that class of business;
- (h) "maturity date" means a fixed date on which benefit may become payable either absolutely or contingently;
- (i) "non-par policies" or "policies without participation in profits" means policies which are not entitled for any share in surplus (profits) during the term of the policy;
- (j) "office yearly premium" means regular premium (excluding extra premiums which are required to be shown separately) payable by the policyholder to secure the basic benefits under the policy in a policy year ;
- (k) "options" means the rights available to a policyholder under a policy;
- (l) "par policies" or "policies with participation in profits" means polices which are not non-par policies as defined under clause (i);
- (m) "policies with deferred participation in profits" means polices entitled for participation in profits after a certain period from the date of commencement of the policy;
- (n) "premium term" means the period during which premiums are payable;
- (o) "riders" or "rider benefits" means add-on benefits, which are in addition to basic benefits under a policy;
- (p) "valuation date" means as respects any valuation the date as at which the valuation is made;
- (q) All words and expressions used herein and not defined but defined in the Insurance Act, 1938 (4 of 1938), or in the Insurance Regulatory and Development Authority Act, 1999 (41 of 1999), or in any Rules or Regulations made thereunder shall have the meanings respectively assigned to them in those Acts or Rules or Regulations.
3. Procedure for Preparation of Actuarial Report and Abstract. — (1) The Abstract and Statements must be so arranged that the number and letters of the paragraphs correspond with Regulation 4.
- (2) The Abstracts and Statements shall be furnished to the Authority, within nine months from the end of the period to which they refer to, in accordance with sub-section (1) of section 15 of the Act.
- (3) Four copies of the Abstracts and Statements shall be furnished to the Authority in accordance with sub-section (1) of section 15 of the Act, and one of the four copies so furnished shall be signed by the persons as mentioned in sub-section (2) section 15 of the Act.
- (4) There shall be appended to every such Abstract and Statement -
- (a) a certificate signed by the principal officer that full and accurate particulars of every policy under which there is a liability, either actual or contingent, has been furnished to the appointed actuary for the investigation; and
- (b) a certificate signed by the appointed actuary with his remarks, if any, to the effect that:-
- i) the data furnished by the principal officer has been included in conducting the valuation of liabilities for the purpose of investigation;
- ii) reasonable steps have been taken to ensure the accuracy and completeness of the data;
- iii) he has complied with provisions of the Act,
- iv) he has complied with guidance notes issued by the Actuarial Society of India with the concurrence of the Authority,
- v) in his opinion, the mathematical reserves are adequate to meet the insurer's future commitments under the contracts, and the policyholders' reasonable expectations.
4. Requirements Applicable to Abstract and Statements.—(1) Abstracts and statements shall be prepared separately in respect of ---
- (a) Linked Business;
- (b) Non-Linked Business; and
- (c) Health Insurance Business.
(2) An insure shall prepare the following statements which shall be annexed to the abstract prepared in accordance with these regulations, namely:-
- (a) in respect of Linked Business,--
- (i) Form LB-1;
- (ii) Form LB-2;
- (iii) Form LB-3;
- (iv) Form LB-4;
- (v) Form IA;
- (b) in respect of Non-Linked Business,--
- (i) Form NLB-1;
- (ii) Form NLB-2;
- (iii) Form DD;
- (iv) Form DDD;
- (v) Form DDDD;
- (vi) Form IA;
- (c) in respect of Health Insurance Business,--
- (i) Form LB-1;
- (ii) Form LB-2;
- (iii) Form LB-3;
- (iv) Form NLB-1;
- (v) Form IA.
- (d) Summary statements,--
- (i) Form K;
- (ii) Form IRDA-AA as specified under Regulation 4 of Insurance Regulatory and Development Authority (Assets, Liabilities, and Solvency Margin of Insurers) Regulations, 2000;
- (iii) Form H;
- (iv) Form I;
- (v) Statement of Composition and Distribution of surplus in respect of policyholders' fund as specified under Regulation 8;
(3) Each Abstract shall show---
- (a) The Valuation Date.--The date on which valuation (investigation) is done;
- (b) New Products.---A brief description of new products introduced during the inter-valuation period giving salient features;
- (c) Foreign Operations- A brief description of the foreign operations of the insurer, during the inter-valuation period;
- (d) Valuation Method.-- A brief description of ----
- (i) the methods adopted in the determination of mathematical reserves in respect of insurance products;
- (ii) the method by which age at entry, premium term, maturity date, valuation age, period from the valuation date to the maturity date, have been treated for the purpose of valuation;
- (iii) the method of allowing for-
- (I) incidence of premium income; and
- (II) premiums payable otherwise than annually;
- (e) Valuation bases.-- (i) Valuation parameters used in the valuation shall be furnished in the manner as specified in the table hereunder:-
| Description | Mortality basis used | Morbidity basis used | Inflation rate | Interest Rate | Expenses | Future bonuses, if any | Others please specify | Remarks |
|---|
| (1) | (2) | (3) | (4) | (5) | (6) | (7) | (8) | (9) |
| (a) Insurance Product: | | | | | | | | |
| i) Regular Premium | | | | | | | | |
| ii) Single premium and Fully paid up | | | | | | | | |
| iii) Reduced Paid up | | | | | | | | |
| (b) Insurance Product: | | | | | | | | |
| i) Regular Premium | | | | | | | | |
| ii) Single premium and Fully paid up | | | | | | | | |
| iii) Reduced Paid up | | | | | | | | |
