Even as strong views are being voiced on the need to review and recast of the two decade old Insurance Regulatory and Development Authority of India (IRDAI) by industry experts, some experts hold contrary opinions.
“There are reports submitted by various agencies. If these reports are studied and a number of gaps noted and noticed periodically are addressed, I think there may not be a need to have another review,” a former Member of IRDAI told IANS preferring anonymity.
“When a new Chairperson joins IRDAI the above can be the agenda to carry out the mandate envisaged in the preamble of the IRDAI Act,” he added.
According to him, the Standing Committee of Finance and the Parliamentary Committee on subordinate legislation reviews the Regulations and working of Regulators periodically.
“Financial Sector Assessment Programme (FSAP) of the International Monetary Fund (IMF) and World Bank reviews the regulators including IRDAI periodically to see whether the International Association of Insurance Supervisors (IAIS), Insurance Core Principles (ICP) are adhered to,” the expert added.
Financial Action Taken Force (FATF) – the global money laundering and terrorist financing watchdog — also reviews the insurance regulatory bodies from the money laundering angle periodically, he added.
“On the twin aim of IRDAI Act ‘to protect policyholders interests and promote orderly growth of the industry’ IRDAI seems to have done a reasonably good job in the 20 years of its existence,” K.K. Srinivasan, former Member, IRDAI had told IANS.
According to him, a Government review of IRDAI be taken up after reviewing the older financial services regulators like the Reserve Bank of India (RBI) and the Securities and Exchange Board of India (SEBI).
“It is time to do a review of IRDAI. It is more than two decades since IRDAI came into existence. As a matter of fact, every regulatory organisation should be reviewed at regular intervals,” N. Rangachary, the first Chairman of IRDAI told IANS.
It was Rangachary who had paved the regulatory path for the sector as the first head of IRDAI.
“There should be a review committee to go into all regulatory aspects. It is time to see whether the original goal of forming the regulatory body has been fulfilled and if not, the action to be taken,” Rangachary suggested.
Echoing similar views was R. Ramakrishnan, Member of the Malhotra Committee on Insurance Reforms.
“It is high time the IRDAI is completely reviewed. This should have been done at the end of the first five years. Better late than never,” Ramakrishan told IANS.
“But the internal organisation of IRDAI needs to be professionalised and strengthened. There is an undeniable perception that compared to its rather small size, there is excessive trade unionism within the Body,” Srinivasan had said.
“This is perhaps attributable to a large extent to the inevitable and somewhat not desirable back-door recruitment of employees in the initial years of its formation. However, this may get corrected in due course when retirements take place,” he added.
One of the areas that needs to be strengthened is the IRDAI’s adjudicatory mechanism.
“With the advent of adjudicatory mechanism that should precede penal action in certain cases, it cannot be said that the adjudication officers have to be continuously well trained and equipped with at least rudimentary legal nuances so as to lend credibility to their performance in quasi-judicial capacity, and recommending penalty with justice and good conscience,” D. Varadarajan, a Supreme Court lawyer specialising in Insurance and Corporate Laws and a Member on KPN Committee on Insurance Laws Reforms.
“In this context, it is also pointed out that unlike the SEBI Act, there is no provision in the IRDA Act, to credit all sums received as penalties to the Consolidated Fund of India. Hence, the penalties imposed have to be just and reasonable, and not excessive, leading to unjust enrichment of the coffers of the Authority,” Varadarajan added.
No increase in fuel prices for 2nd consecutive day on Tuesday
Petrol and diesel prices remained unchanged for the second consecutive on Tuesday providing relief to consumers who have been facing a regular increase in fuel prices in the past few months taking the retail rates to historic high levels.
With no revision, the price of petrol in Delhi remained Rs 105.84 a litre and Rs 111.77 per litre in Mumbai, according to a price notification of state-owned fuel retailers. In Mumbai, diesel rates also remained static at Rs 102.52 a litre; while in Delhi it costs Rs 94.57, the same as on Sunday.
The price pause comes after the rates rose for four straight days when the rates of both petrol and diesel rose by Rs 1.40 paise per litre. There was no change in the rates also on October 12 and 13.
Diesel prices have increased on 19 out of the last 25 days taking up its retail price by Rs 5.95 per litre in Delhi.
With diesel prices rising sharply, the fuel is now available at over Rs 100 a litre in several parts of the country. This dubious distinction was earlier available to petrol that had crossed Rs 100 a litre-mark across the country a few months earlier.
Petrol prices had maintained stability since September 5, but oil companies finally raised the pump prices last week. Petrol prices have also risen on 16 of the previous 21 days taking up the pump price by Rs 4.65 per litre.
Crude prices have been on a surge rising over a three-year high level of over $ 85.7 a barrel now. It has softened a bit, falling below $ 85 a barrel now. Since September 5, when both petrol and diesel prices were revised, the price of petrol and diesel in the international market is higher by around $9-10 per barrel as compared to the average prices during August.
Markets open on a positive note
The 30-scrip Sensitive Index (Sensex) on Tuesday opened on a positive note during the morning trade.
The Sensex of the BSE opened at 62,156.48 points and touched a high of 62,159.29 points. The Sensex touched a low of 61,964.41 points.
On Monday, the Sensex closed at 61,765.59 points.
The Sensex is trading at 62,061.59 points, up by 296.00 points or 0.48 per cent.
On the other hand, the broader 50-scrip Nifty at National Stock Exchange (NSE) opened at lower note at 18,602.35 points after closing at 18,477.05 points.
The Nifty is trading at 18,549.55 points in the morning.
Petrol, diesel prices rise again, burn bigger holes in consumers’ pockets
Petrol and diesel price rose again on Friday taking its retail rates to record high levels across the country affecting consumers this festive season.
Accordingly, in the national capital, petrol and diesel prices increased by 35 paisa per litre to Rs 105.14 per litre and Rs 93.87 per litre, respectively.
In India’s financial capital of Mumbai, petrol became costlier by 34 paisa per litre to Rs 111.09 a litre on Friday, the highest across all the four metro cities. Diesel also costs Rs 101.77 for one litre in Mumbai.
The price hike on Friday is for a second consecutive day after the rates remained static on Tuesday and Wednesday.
Diesel prices now have increased on 17 out of the last 21 days taking up its retail price by Rs 5.25 per litre in Delhi.
With diesel price rising sharply, the fuel is now available at over Rs 100 a litre in several parts of the country. This dubious distinction was earlier available to petrol that had crossed Rs 100 a litre mark across the country a few months earlier.
Petrol prices had maintained stability since September 5 but oil companies finally raised its pump prices last week and this week given a spurt in the product prices lately. Petrol prices have also risen on 14 of the previous 17 days taking up its pump price by Rs 3.95 per litre.
OMCs had preferred to maintain their watch prices on global oil situation before making any revision in prices. This is the reason why petrol prices were not revised for last three weeks. But extreme volatility in global oil price movement has now pushed OMCs to effect the increase.
Crude price has been on a surge rising over three year high level of over $84.5 a barrel now. Since September 5 when both petrol and diesel prices were revised, the price of petrol and diesel in the international market is higher by around $9-10 per barrel as compared to average prices during August.
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