annual report 2009-10 - IRDA

ANNUAL REPORT 2009-10PART IIREVIEW OF WORKING AND OPERATIONS1. REGULATION OF INSURANCE ANDREINSURANCE COMPANIESII.1.1 Submission of report on performance ofproductsThe Authority has mandated that while filing theproducts under the File and Use procedure, a reportregarding the performance of the products currentlyin existence in the same class for more than two yearsshall also be filed, certified by the Appointed Actuaryof the insurance company.deficiency is noticed the Board must be informedfor necessary action. In the event of no action/inadequate action, the Authority shall be keptinformed.• The Appointed Actuary has to prepare thefinancial condition report of the non-life insurancecompany, and in this context the Regulator willgive necessary guidance very shortly.II.1.3 Submission of compliance report forFacultative Reinsurance PlacementsII.1.2 Submission of Financial Viability CertificateRisk based pricing involves availability of a strongdatabase and analysis of the pricing of products, tomeasure the underwriting impact, test the profitabilityof products, etc. Thus, the role of Appointed Actuarieshas to be enhanced significantly so that the non-lifeinsurers are in a position to cope with public demandfor competitively priced non-life products and at thesame time ensure availability of solvency on acontinuous basis. Due importance must also be givento the profit to be generated by each product. Keepingin view all these requirements the following measureshave been initiated:• The Appointed Actuary must be given necessaryinfrastructure in the office of the non-life insurerso that he/she can function effectively and leadthe team members in the actuarial department.• The Appointed Actuary shall be invited for all theBoard Meetings of the non-life insurancecompany.• The Appointed Actuary has to certify that eachproduct is financially viable.• The Appointed Actuary must help the insurer toensure the availability of required solvency of thecompany at all points of time and whereverTABLE 55DETAILS OF INDIVIDUAL AGENTS : LIFE INSURERSIn order to monitor compliance with Regulation 2(f)and 3(8) of IRDA (Reinsurance - General Insurance)Regulations, 2000 the Authority has issued directionsrequiring every insurer to submit on half yearly basisconfirmation of compliance with the regulations andto give details of all facultative placements made bythe company within one month from the close of thehalf year.2. INTERMEDIARIES ASSOCIATED WITH THEINSURANCE BUSINESSInsurance AgentsII.2.1 The year 2009-10 witnessed a 1.39 per centincrease in the number of individual agents. Thenumber of the agents has gone up from 29.38 lakh ason 1 st April, 2009 to 29.78 lakh as on 31 st March, 2010.While the private life insurers reported a decrease of1.07 per cent, LIC showed an increase of 4.31 percent in the number of individual agents. As at31 st March, 2010, the number of agents registeredwith LIC stood at 14.03 lakh (13.45 lakh in 2008-09).The corresponding number for private sector insurerswas 15.75 lakh (15.93 lakh in 2008-09). The attritionwas higher in case of private sector insurers at6,42,439 more than two times, as against 2,54,596for LIC.Insurer As on 1 st April, 2009 Additions Deletions As on 31 st March, 2010Private 1592579 625336 642439 1575476LIC 1344856 312547 254596 1402807Total 2937435 937883 897035 297828359