The Insurance Amendment Act, 2002

Ans. IRDAI is an abbreviation of the Insurance Regulatory and Development Authority of India. It is an apex institutional body set up under the IRDA Act of 1999 under the Ministry of Finance, Government of India which operates and controls the insurance sector/industry in India.

It has the following salient features:

• It is a body corporate.
• It has perpetual succession and a common seal.
• It has the authority to contract with others and can also sue and be sued in its name.
• It has the power to set up regional offices in different parts of India.

Ans. The Insurance Amendment Act of 2002 was introduced during the monsoon session of the Parliament which is notified in the Official Gazette of India specifically as Act no. 42 of the year 2002. The Insurance Amendment Act of 2002 helps in coordinating the insurance business with the rules, regulations, and provisions of the IRDA Act of 1999.

 The Act of 2002, was introduced mainly to modify the Insurance Act of 1938 particularly to make provisions for the Insurance Cooperative Society which is registered under the Multi-State Cooperative Societies Act of 1984 where there exists a minimum paid-up capital of Rs.100 crore, eliminating the deposits as mentioned under Section 7 of the Act.

Ans. According to the amendment of section 42A of the Insurance Act, it claims that-

No insurer has the authority to commence or transact any business about insurance in India using any principal agent, special agent, or chief agent on and after the beginning of the Insurance Amendment Act of 2002.

Ans. The features of the Insurance Amendment Act of 2002 are as follows:

• It helps in promoting and regulating the professional institutions that serve the insurance sector in India.
• It supports carrying on any insurance business by the Insurance Cooperative Society, where every such society is deemed to be an insurer.
• It helps in coordinating with the rules and regulations of IRDAI set up under the IRDA Act of 1999.
• It ensures transparency, fairness, and accountability within the insurance sector to protect the interests of the policyholders.

Ans. A Global Depository Receipt (GDR) is a certificate issued by a depository bank that purchases shares in foreign corporations and deposits them in an account. It is also called an international depository receipt (IDR).

Ans. Indian Depository Receipts are modelled after American Depository Receipts, which were introduced in 1927. The Securities and Exchange Board of India (SEBI) was the first to put IDR laws into effect. Under the Foreign Exchange Management Act, the Reserve Bank of India (RBI) issued operations.

Ans. To acquire permission for the issuance of IDRs, an application must be made with the SEBI. The application for approval must be submitted at least 90 days before the date of the start of the Issue of IDRs. The application, together with a proper research report, should be sent to the Merchant Banker.

Ans. A depositary receipt (DR) is a negotiable certificate issued by a bank that represents shares in a foreign business that are traded on a local stock exchange. The depositary receipt allows investors to hold shares in the equities of other countries while also providing an option to deal in an international market.