With a far stronger UPA about to assume the reins in Delhi, die-hard opponents of the Insurance Bill may be more muted in their protests when the Bill is introduced again. But Insurance Regulatory Development Authority (IRDA) chairman J Hari Narayan, isn't ruling out reservations about the Bill's contents that deal with FDI.

Though, Hari Narayan wants the Insurance Laws (Amendment) Bill, 2008, to see the light of day at the earliest, he feels its passage in Parliament will not be a cake walk.

But Hari Narayan feels “if the Bill is passed it will offer easier fund inflows into the sector with both Indian and foreign promoters having to nearly equally share the burden of infusing capital into these companies. Currently, foreign promoters share 26 percent of the capital infusion requirement with the remaining 74 percent burden on the Indian promoters”.

The Bill once passed will also see a host of other features which are currently not present, apart from 49 percent FDI.

The Insurance Laws (Amendment) Bill, 2008, was introduced in December 2008 in Rajya Sabha. Subsequently, it was referred to the Standing Committee on Finance, which is scheduled to submit its report by the first day of the next session.

The Bill amends three Acts: the Insurance Act, 1938; the General Insurance Business (Nationalisation) Act, 1972 and the Insurance Regulatory and Development Authority (IRDA) Act, 1999.

The bill proposes to make it mandatory for insurers to refund the premiums in case any policyholder has suppressed information knowingly or unknowingly. Currently, the company retains the entire premium paid while the policy is cancelled.

Under the bill, no life insurance policy shall be questioned on any ground whatsoever after five years from the date of the policy. This Bill omits provisions related to Tariff Advisory Committee in view of the detariffing of rates and premiums.

The Bill enhances penalties for offences such as carrying on business of insurance without registration or not complying with the obligation towards rural and social sectors and third party insurance of motor vehicles.

The Bill amends the Insurance Regulatory and Development Authority Act, 1999 by including “insurance agents” in the definition of “insurance intermediaries”.