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ANNUAL REPORT 2011-12
margin relief. As indicated above, IRDA also
implemented the automatic formula for revision
of TP Premium provisions with effect from 1 st April,
2012.
The member companies have effected two
settlements as envisaged in the dismantling of
the IMTPIP Order of the Authority as on 30 th June,
2012 - a provisional settlement for 2007-08 on
31 st March 2012; and 2007-08 and 2008-09 on
30 th June 2012.
II.6.10 Declined Risk Pool
The Authority reviewed the Motor Commercial
Third Party Pool arrangement and decided to set
up a declined risk pool for third party commercial
vehicle motor insurance with effect from 1 st April,
2012 in order to ensure that the non-life insurance
companies grew in a healthy manner and the
policyholders’ interests are protected.
II.6.11 Health
The following initiatives, driven by IRDA, were
implemented by the industry:
o
o
Portability of health insurance policies, and
Coverage of AYUSH i.e. alternative systems
of medicines.
IRDA constituted the Health Insurance Forum.
The Authority has also framed an exposure draft
on insurance for persons living with HIV/AIDs and
released it for comments. The Council is in
continuous discussion with IRDA on major issues,
such as, insurance for HIV people, cover for
persons with disabilities. These issues are also
under discussion with the Government of India,
National AIDS Control Organization (NACO), etc.
II.6.12 Marine
Marine Cargo and Hull underwriters held three
meetings during the year and discussed the following
issues:
Project Cargo underwriting, Bulk cargo
underwriting rating and deductibles,
Impact of Sanction clause of UN, UN and EU on
crude oil imports by public sector undertakings
(PSUs),
Impact of piracy claims – over 15 plus claims and
`160 crore in the last two years,
Marine Hull Insurance – Deductibles,
Requirement of registration of Carrier under the
Act, and
Draft of Subrogation agreement cum Power of
Attorney.
II.6.13 Property
Property Underwriters Forum which met under the
aegis of the Council exchanged sentiments akin to
Marine Underwriters. They deliberated on the following
common issues affecting this portfolio:
Rationalization of the deductibles applicable on
property insurance policies,
Review of the coinsurance agreement,
Coverage of suppliers and customers premises
in Business Interruption policies,
Prudent approach to rating of Natural Catastrophe
perils, and
Incorporation of Common Reinsurance treaty
exclusions in the primary insurance policies of the
Insurance companies.
II.6.14 Accounts and Taxation (CFO)
The CFOs of Council members met a number of times
to discuss and formulate the Industry views and
comments on the following issues:
Direct Tax Code provisions - such as Tax
Deducted at Source (TDS) on the Reinsurance
(RI) Premium,
Restore Capital Gains Tax (CGT) exemption on
investments,
Non-applicability of MAT to be provided to non-life
insurance companies,
Service Tax provisions and Cenvat credit rules,
Negative list on Service Tax,
Implementation of IRDA Orders on accounting of
Reserves (Including IBNR) on IMTPIP, as a
sequel to the dismantling of the erstwhile IMTPIP
Pool with effect from 31 st March, 2012.
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