INSURANCE LAWINSURANCE LAW AND AND …

1 study material PROFESSIONAL PROGRAMME INSURANCE LAWINSURANCE LAWINSURANCE LAWINSURANCE LAW AND AND AND AND PRACTICEPRACTICEPRACTICEPRACTICE MODULE 3 ELECTIVE PAPER ICSI House, 22, Institutional Area, Lodi Road, New Delhi 110 003 tel 011-4534 1000, 4150 4444 fax +91-11-2462 6727 email website THE INSTITUTE OF COMPANY SECRETARIES OF INDIA TIMING OF HEADQUARTERS Monday to Friday Office Timings to Public Dealing Timings Without financial transactions to With financial transactions to Phones 4150444,45341000 Fax 011-24626727 Website E-mail Laser Typesetting by Delhi Computer Services, Dwarka, New Delhi Printed at Tan Prints/PRN-2548/800/July, 2014 (iii)

2 PROFESSIONAL PROGRAMME INSURANCE LAWS AND PRACTICE Company Secretaries have a pivot role to play in the INSURANCE Sector. A Company Secretary can work as a compliance officer in an INSURANCE Company and play an important role in ensuring compliance to complicated legal, regulatory and supervisory issues all the time, transcending various spheres of INSURANCE Company s operations. So, in order to build the capacity of Companies Secretaries to work as a compliance officer in INSURANCE Companies and to provide them a specialized knowledge in INSURANCE laws and practice, New Syllabus for Professional Program contains one of the five elective papers titled INSURANCE Law and Practice.

3 The students interested in pursuing their career in INSURANCE sector may opt for this subject. The syllabus and contents of this paper has been developed in association of INSURANCE Institute of India, Mumbai. An attempt has been made to cover fully the syllabus prescribed for each module/subject. The presentation of topics may not always be in the same sequence as given in the syllabus. Candidates are expected to take note of all the latest developments relating to the subjects covered in the syllabus by referring to IRDA Circulars, Financial Dailies, Economic Journals, Latest Books and Publications on the subjects/topics concerned Although due care has been taken in publishing this study material , yet the possibility of errors, omissions and/or discrepancies cannot be ruled out.

4 This publication is released with an understanding that the Institute shall not be responsible for any errors, omissions and/or discrepancies or any action taken in that behalf. Should there be any discrepancy, error or omission noted in the study material , the Institute shall be obliged if the same are brought to its notice for issue of corrigendum in the e-bulletin, `Student Company Secretary . In the event of any doubt, students may write to the Directorate of Academics in the Institute for clarification at There is Open book examination for this Elective subject of Professional Programme.

5 This is to inculcate and develop skills of creative thinking, problem solving and decision making amongst students of its Professional Programme and to assess their analytical ability, real understanding of facts and concepts and mastery to apply, rather than to simply recall replicate and reproduce concepts and principles in the examination. (iv) PROFESSIONAL PROGRAMME SYLLABUS FOR ELECTIVE - PAPER 3: INSURANCE LAWS AND PRACTICE (100 MARKS) Level of Knowledge: Expert Knowledge Objective: To acquire To acquire specialized knowledge of law and practice relating to Detailed Contents: 1.

6 Understanding and Managing Risk Risk Management - Perils - Nature Risk Analysis Planning Control - Mechanism for Transfer of risk INSURANCE and Reinsurance 2. General Principles and Concepts of INSURANCE Insurable Interest - Indemnity - Uberrimae fidei - Proximate Cause - Subrogation and Contribution - Differentiation INSURANCE and Guarantee - INSURANCE and Wager - Disclosure Moral Hazards 3. INSURANCE Contract and Indian Market Conditions Nature of INSURANCE Contract - Features of INSURANCE Contract - Types of INSURANCE - Concept of Intermediaries Market Players and their Roles - Agents, Brokers, Surveyors & Loss Assessors, Health Third Party Administrators, Certification of INSURANCE Professionals, Training Organizations.

7 4. Regulatory Environment Specific Legislations Regulation of INSURANCE Business, INSURANCE Act, INSURANCE Regulatory and Development Act, Powers and Functions of IRDA, Relevant Regulations and Guidelines issued by IRDA, Licensing, Audit & Supervision, Investments, Amalgamation and Transfer, Grievance Redressal, Rural and Social Sector obligations, Micro INSURANCE , Financial inclusion, Product Approval. 5. Regulatory Environment - General Other Relevant Legislation (Motor Vehicles Act, Marine INSURANCE Act, Employees State INSURANCE Act etc.)

8 , Consumer Protection, Courts, Tribunals, INSURANCE Ombudsmen, Arbitration. 6. International Regulatory Framework International Association of INSURANCE Supervisors Future Trends 7. Life INSURANCE - Practices, Procedures Application of Principles in Life INSURANCE Contract - Representation - Assignment and Nomination - Title and Claims - Tax Law Implications - Concept of Trusts in Life Policy - Stamp Duties - Role and Function of Life INSURANCE Companies. 8. Life INSURANCE & Pension Products Life INSURANCE Products Proposals, Policy and documentation (v) 9. General INSURANCE - Practices and Procedures Focus Underwriting Application of Principles in General INSURANCE Contracts Structure of the Policy INSURANCE Documentation Underwriting and Rating - Disclosure - Terms and Conditions.

9 10. General INSURANCE - Practices and Procedures Focus Claims Claims Procedures Underinsurance - Condition of Average - Recovery Salvage. 11. General INSURANCE Products Property INSURANCE (Fire and Engineering) Marine INSURANCE (Hull and Cargo) Motor INSURANCE Business Interruption Liability INSURANCE (Public, Products, Professional, Directors & Officers etc) Personal Lines (Health, Accident, Travel, Residential Premises etc.) Rural and Agricultural Micro- INSURANCE Other Miscellaneous lines (Burglary, Bankers Risks, Fidelity etc.)

10 12. Ethics and Corporate Governance Framework for INSURANCE Companies Financial Statements, Protection of Policy holders, Concept of Treating Customers Fairly (TCF), Actuarial and Other Certifications (vi) LIST OF RECOMMENDED BOOKS ELECTIVE PAPER : INSURANCE LAW AND PRACTICE List of Recommended Books: 1. M. N. Srinivasan : Principles of INSURANCE Law, Wadhwa & Co. 2. Rajiv Jain : INSURANCE Law and Practice, Vidhi Publication Private Limited 3. Taxmann : INSURANCE Manual, Taxmann Publication Private Limited 4. Bharat : Manual of INSURANCE Laws, Bharat Publication Private limited 5.