 "Lloyd's India to have all operations in one location: IRDAI")
The Insurance Regulatory and Development Authority of India (Irdai) has said Lloyds India should ensure the market and the constituents are housed in one location for the conduct of reinsurance business.
Following the passage of the Insurance Laws (Amendment) Act, 2015, Lloyds UK has been permitted to set up a branch office in India. This had necessitated Irdai to notify a fresh set of regulations for this category of insurers.
“Lloyds UK shall set up Lloyds India, that will be granted certificate of registration to set up market and associated structures for conduct of reinsurance business in India and outside India,” Irdai said in an exposure draft released on its website on Friday.
It said the syndicates of Lloyds India would be subject to the same reinsurance regulations as applicable to Indian insurer and reinsurer.
“In case Lloyds India is granted certificate of registration... then i) each syndicate shall maintain a minimum retention of 50 per cent of the Indian reinsurance business; ii) a syndicate who fails to keep the minimum retention limit of 50 per cent... shall obtain prior approval of the Authority (Irdai) to transact business,” said the draft. The constituents of Lloyds India include members of Lloyds, UK; service companies of Lloyds India; and syndicates of Lloyds India.
The regulator said the appointment, re-appointment, removal and managerial remuneration of the chief executive officer of Lloyds India would need Irdai’s approval. According to the exposure draft, it also has to retain the core activities such as underwriting, claims settlement and regulatory compliances. However, it can outsource functions such as back-office servicing, investment, information technology, accounts, marketing, human resources, administration and publicity.
Following the passage of the Insurance Laws (Amendment) Act, 2015, Lloyds UK has been permitted to set up a branch office in India. This had necessitated Irdai to notify a fresh set of regulations for this category of insurers.
“Lloyds UK shall set up Lloyds India, that will be granted certificate of registration to set up market and associated structures for conduct of reinsurance business in India and outside India,” Irdai said in an exposure draft released on its website on Friday.
It said the syndicates of Lloyds India would be subject to the same reinsurance regulations as applicable to Indian insurer and reinsurer.
“In case Lloyds India is granted certificate of registration... then i) each syndicate shall maintain a minimum retention of 50 per cent of the Indian reinsurance business; ii) a syndicate who fails to keep the minimum retention limit of 50 per cent... shall obtain prior approval of the Authority (Irdai) to transact business,” said the draft. The constituents of Lloyds India include members of Lloyds, UK; service companies of Lloyds India; and syndicates of Lloyds India.
The regulator said the appointment, re-appointment, removal and managerial remuneration of the chief executive officer of Lloyds India would need Irdai’s approval. According to the exposure draft, it also has to retain the core activities such as underwriting, claims settlement and regulatory compliances. However, it can outsource functions such as back-office servicing, investment, information technology, accounts, marketing, human resources, administration and publicity.
