IRDA reluctant to accept KPN committee views

The insurance watchdog, Insurance Regulatory and Development Authority (IRDA) doesn’t seem to agree with all the suggestions and recommendations made by the K P Narsimhan Committee. The IRDA is reluctant to accept the proposed recommendations since it would result in major changes in the Insurance Act, 1938. This would also mean to have an appellate authority that will take care of the all the disputes and penalties arising from the breach of contract to the insured by the insurers. The recommendations also included introduction of different capital requirements for different category of insurance companies. Besides, the other recommendation made was to reduce the current capital requirement for insurers from Rs 200 crore to Rs 100 crore. These recommendations were followed after the finance minister made a mention in the Budget 2006-’07 of introducing the Comprehensive Bill on insurance. He also added that the KPN Committee was appointed with a view to recommend a comprehensive law on insurance and that the KPN panel had submitted its report to the IRDA.