The finance ministry will decide whether there will be a fresh legislation to formulate a new insurance Act so as to scrap the Insurance Act 1938 or modify the Act after taking into consideration the recommendations made by the Law Commission. | |
| The Insurance Regulatory Development Authority (Irda) and the Life Insurance Council are of view that a brand new insurance Act is needed by the sector, which would take into consideration the dynamic changes happening in the industry. |
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| Two years ago the finance ministry had mooted the idea for a new insurance legislation in the place of the outdated Insurance Act 1938. A preliminary draft on the recommendations of Insurance Act 1938 has been prepared by the law commission. |
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| The Law Commission has submitted its recommendation to the winter session of Parliament last month. |
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| C S Rao, chairman, Irda, told Business Standard, "Some provisions in the Insurance Act 1938 are outdated and have no relevance to the insurance sector in 2005. It will be advantageous if a legislation is passed for a new Act rather modify the old Act." |
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| "There has been a lot of amendments made to Insurance Act of 1938, it is time to have a fresh legislation which will take into consideration the changes happening in the insurance industry, said S V Mony, secretary general of the Life Insurance Council. |
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| There has been significant changes happening in the insurance sector with the entry of private players. |
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| The participation of the private players has changed the nature of the industry by enlarging the scope of insurance from a mere tool of tax concession to an investment option. |
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