The Insurance Act, 1938

Insurance Actcentral

An Act To Consolidate And Amend The Law Relating To The Business Of Insurance.

Act Number

Enactment

1938-02-26

Ministry

Ministry Of Finance

Downloads

English

हिंदी

PRELIMINARY

Section 1Short title, extent and commencement.Section 2Definitions.Section 2AInterpretation of certain words and expressions.Section 2BAppointment of Controller of Insurance.

PROVISIONS APPLICABLE TO INSURERS

Section 2CProhibition of transaction of insurance business by certain persons.Section 2CAPower of Central Government to apply provisions of this Act to Special Economic Zones.Section 2CBProperties in India not to be insured with foreign insurers except with the permission of Authority.Section 2DInsurers to be subject to this Act while liabilities remain unsatisfied.Section 2E[Omitted.].Section 3Registration.Section 3APayment of annual fee by insurer.Section 3BCertification of soundness of terms of life insurance business.Section 4Minimum limits for annuities and other benefits secured by policies of life insurance.Section 5Restriction on name of insurer.Section 6Requirements as to capital.Section 6ARequirements as to capital structure and voting rights and maintenance of registers beneficial owners of shares.Section 6AA[Omitted.].Section 6BProvision for securing compliance with requirements relating to capital structure.Section 6C[Omitted.].Section 7[Omitted.].Section 8[Omitted.].Section 9[Omitted.].Section 10Separation of accounts and funds.Section 11Accounts and balance-sheet.Section 12Audit.Section 13Actuarial report and abstract.Section 14Record of policies and claims.Section 15Submission of returns.Section 16[Omitted.].Section 17[Omitted.].Section 17A[Omitted.].Section 18Furnishing reports.Section 19Abstract of proceedings of general meetings.Section 20Custody and inspection of documents and supply of copies.Section 21Powers of Authority regarding returns.Section 22Powers of Authority to order revaluation.Section 23Evidence of documents.Section 24[Omitted.].Section 25Returns to be published in statutory forms.Section 26Alterations in the particulars furnished with application for registration to be reported.

INVESTMENT, LOANS AND MANAGEMENT

Section 27Investment of assets.Section 27AFurther provisions regarding investments.Section 27BProvisions regarding investments of assets of insurer carrying general insurance business.Section 27CInvestment by insurer in certain cases.Section 27DManner and conditions of investment.Section 27EProhibition for investment of funds outside India.Section 28Statement and return of investment of assets.Section 29Prohibition of loans.Section 30Liability of directors, etc.,for loss due to contravention of section 27,27A,27B,27C,27D or section 29.Section 31Assets of insurer how to be kept.Section 31AProvisions relating to managers, etc.Section 31BPower to restrict payment of excessive remuneration.Section 32[Omitted.].Section 32AProhibition of common officers and requirement as to whole-time officers.Section 32BInsurance business in rural and social sectors.Section 32CObligations of insurer in respect of rural or unorganised sector and backward classes.Section 32DObligation of insurer in respect of insurance business in third party risks of motor vehicles.

INVESTIGATION

Section 33Power of investigation and inspection by Authority.

APPOINTMENT OF STAFF

Section 33APower to appoint staff.

POWER TO ISSUE DIRECTIONS

Section 34Power of the Authority to issue directions.

CONTROL OVER MANAGEMENT

Section 34AAmendment of provisions relating to appointments of managing directors, etc., to be subject to previous approval of the Controller.Section 34BPower of Authority to remove managerial persons from office.Section 34CPower of Authority to appoint additional directors.Section 34DSections 34B and 34C to override other laws.Section 34EFurther powers.Section 34FPower of Authority to issue directions regarding re-insurance treaties, etc.Section 34GOmitted.Section 34HSearch and seizure.

AMALGAMATION AND TRANSFER OF INSURANCE BUSINESS

Section 35Amalgamation and transfer of insurance business.Section 36Sanction of amalgamation and transfer by Controller.Section 37Statements required after amalgamation and transfer.Section 37APower of Authority to prepare Scheme of Amalgamation.

ASSGNMENT OR TRANSFER OF POLICIES AND NOMINATIONS

Section 38Assignment and transfer of insurance policies.Section 39Nomination by policy-holder.

COMMISSION AND REBATES AND LICENSING OF AGENTS

Section 40Prohibition of payment by way of commission or otherwise for procuring business.Section 40A[Omitted.].Section 40BLimitation of expenses of management in life insurance business.Section 40CLimitation of expenses of management in general insurance business.Section 41Prohibition of rebates.Section 42Appointment of insurance agents.Section 42AProhibition of insurance business through principal agent, special agent and multilevel marketing.Section 42DIssue of registration to intermediary or insurance intermediary.Section 42ECommission, brokerage or fee payable to intermediary or insurance intermediary.Section 43Register of insurance agents.Section 44[Omitted.].Section 44APower to call for information.

SPECIAL PROVISIONS OF LAW

Section 45Policy not to be called in question on ground of mis-statement after two years.Section 46Application of the law in force in India to policies issued in India.Section 47Payment of money into Court.Section 47A[Omitted.].Section 48A. Insurance agent or intermediary or insurance intermediary not to be director in insurance company.Section 48BFurther provision regarding directors.Section 48C[Omitted.].Section 49Restriction On dividends and bonuses.Section 50Notice of options available to the assured on the lapsing of a policy.Section 51Supply of copies of proposals and medical reports.Section 52Prohibition of business of dividing principle.

MANAGEMENT BY ADMINISTRATOR

Section 52AWhen Administrator for management of insurance business may be appointed.Section 52BPowers and duties of the Administrator.Section 52BBPowers of Administrator respecting property liable to attachment under section 106.Section 52CCancellation of contracts and agreements.Section 52DTermination of appointment of Administrator.Section 52EFinality of decision appointing Administrator.Section 52FPenalty for withholding documents or property from Administrator.Section 52GProtection of action taken under sections 52A to 52D.

ACQUISITION OF THE UNDERTAKINGS OF INSURERS IN CERTAIN CASES

Section 52H[Omitted.].Section 52IOmitted..Section 52J[Omitted.].Section 52K[Omitted.].Section 52L[Omitted.].Section 52M[Omitted.].Section 52N[Omitted.].

WINDING UP

Section 53Winding up by the Court.Section 53AUnpaid-up share capital.Section 54Voluntary winding up.Section 55Valuation of liabilities.Section 56Application of surplus assets of life insurance fund in liquidation or insolvency.Section 57Winding up of secondary companies.Section 58Schemes for partial winding up of insurance companies.Section 59[Omitted.].Section 60Notice of policy values.Section 61Power of Court to reduce contracts of insurance.Section 61AAppeal to National Company Law Appellate Tribunal.

SPECIAL PROVISIONS RELATING TO EXTERNAL COMPANIES

Section 62Power of Central Government to impose reciprocal disabilities on non-Indian companies.Section 63Particulars to be filed by insurers established outside India.Section 64Books to be kept by insurers established outside India.

LIFE INSURANCE COUNCIL AND GENERAL INSURANCE COUNCIL AND COMMITTEES THEREOF

Section 64A[Omitted.].Section 64B[Omitted.].Section 64CCouncils of Life Insurance and General Insurance.Section 64DAuthorisation to represent in Councils.Section 64EAuthorities of the Life Insurance Council and the General Insurance Council.Section 64FExecutive Committees of the Life Insurance Council and the General Insurance Council.Section 64GResignation and filling up of casual vacancies.Section 64HDuration and dissolution of Executive Committees.Section 64IOmitted..Section 64JOmitted.Section 64KOmitted.Section 64LFunctions of Executive Committee of General Insurance Council.Section 64MExecutive Committee of General Insurance Council may advise in controlling expenses.Section 64NPower of the Executive Committees to act together in certain cases.Section 64OOmitted..Section 64P[Omitted.].Section 64Q[Omitted.].Section 64RGeneral power of Life Insurance Council and General Insurance Council.Section 64S[Omitted.].Section 64T[Omitted.].

TARIFF ADVISORY COMMITTEE AND CONTROL OF TARIFF RATES

Section 64UOmitted.Section 64UAOmitted.Section 64UBOmitted.Section 64UCOmitted.Section 64UDOmitted.Section 64UEOmitted.Section 64UFOmitted.Section 64UGOmitted.Section 64UHOmitted.Section 64UIOmitted.Section 64UJOmitted.Section 64UKOmitted.Section 64ULOmitted.Section 64ULAOmitted.Section 64UMSurveyors and loss assessors.

SOLVENCY MARGIN, ADVANCE PAYMENT OF PREMIUM AND RESTRICTIONS ON THE OPENING OF A NEW PLACE OF BUSINESS

Section 64VAssets and liabilities how to be valued.Section 64VASufficiency of assets.Section 64VBNo risk to be assumed unless premium is received in advance.Section 64VCRestrictions on the opening of a new place of business.

RE-INSURANCE

Section 101ARe-insurance with Indian re-insurers.Section 101BAdvisory Committee.Section 101CExamination of re-insurance treaties.

MISCELLANEOUS

Section 102Penalty for default in complying with, or act in contravention of this Act.Section 103Penalty for carrying on insurance business in contravention of sections 3.Section 104Penalty for contravention of sections 27, 27A, 27B, 27D and 27E.Section 105Wrongfully obtaining or withholding property.Section 105AOffences by companies.Section 105BPenalty for failure to comply with sections 32B, 32C and 32D.Section 105CPower to adjudicate.Section 105DFactors to be taken into account by the adjudicating officer.Section 106Power of Court to order restoration of property of insurer or compensation in certain cases.Section 106ANotice to and hearing of Authority.Section 107[Omitted.].Section 107AChairman, etc., to be public servants.Section 108Power of Court to grant relief.Section 109Cognizance of offences.Section 110Appeal to Securities Appellate Tribunal.Section 110ADelegation of powers and duties of Chairperson of the Authority.Section 110BSignature of documents.Section 110CPower to call for information.Section 110DCertain claims for compensation barred.Section 110E[Omitted.].Section 110FProvisions applicable to state Governments, etc.Section 110G[Omitted.].Section 110H[Omitted.].Section 110HAPenalty to be recoverable as arrear of land revenue.Section 111Service of notices.Section 112Declaration of interium bonuses.Section 113Acquisition of surrender value by policy.Section 114Power of Central Government to make rules.Section 114APower of Authority to make regulations.Section 115Alteration of forms.Section 116Power to exempt from certain requirements.Section 116ASummary of returns to be published.Section 117Saving of provisions of Indian Companies Act, 2013.Section 118Exemptions Section 119Inspection and supply of copies of published prospectus, etc.Section 120Determination of market value of securities deposited under this Act.Section 121Repealed.Section 122Repealed.Section 123Repealed.