The Insurance Regulatory and Development Authority (IRDA) has made it mandatory for insurance companies to disclose the remuneration of independent directors as part of its steps towards improving corporate governance.
The insurance regulator, while modifying the corporate governance guidelines, has also imposed restrictions on the appointment of family members and close relatives on the same board as independent directors.
"As a matter of prudence, not more than one member of a family, or a close relative as defined in the Companies Act or an associate (partner, director, etc,) should be on the Board of an Insurer as Independent Director."
Besides remuneration details, insurance companies would also have to disclose details of the number of meetings held by directors; composition of the board and the Policyholders' Protection and Asset Liability Management committees; qualifications; and status of directorships, the IRDA said.
"Each insurer should designate their Company Secretary as the Compliance Office whose duty will be to monitor continuing compliance with these guidelines," it added.
The amendments in the guidelines were carried out after receiving comments from the insurers and other stakeholders, IRDA said, adding, companies are advised to take necessary action to ensure that the compliance of the Guidelines is in place from the financial year beginning April 1, 2010.
