Summary |
The Indian insurance industry was under state control with virtually no private participation till the late 1990s. It was majorly ruled by the Life Insurance Corporation of India (LIC) in the life insurance market and the General Insurance Corporation of India (GIC) and its four subsidiaries in the non-life insurance market.
Malhotra committee’ submitted its report in 1994, and it strongly recommended private participation in the industry. Due to the strong opposition from various political parties and labor unions, the insurance bill was finally accepted by the Parliament in 1999.
As per the bill, the IRDA became the regulatory authority for the insurance sector in India. It had the power to grant licenses to foreign players to operate in India, and to formulate operational rules and regulations for the working of insurance companies. It would regulate the performance of the insurance companies and monitor strategies adopted by them
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