ORDER NO. IRDA/NL/ORD/MPL/276/12/2011, DATED 23-12-2011
In exercise of the powers vested under Section 14(2) of the IRDA Act, 1999, the Authority issues the following order reforming the Indian Motor Third Party Pool System. The Authority hereby orders the dismantling of the existing Indian Motor Third Party Pool with effect from 31.3.2012.
Dismantling of existing Indian Motor Third Party Pool
1. The existing Indian Motor Third Party Pool shall be dismantled in the following manner:
i. The dismantling of the motor third party pool shall be done on clean-cut basis.
ii. The pool shall not be subject to run-off.
iii. The general insurers who have issued the policy shall also be responsible for servicing them and settling the claims as and when they arise.
iv. The total liabilities of the motor third party insurance policies shall be calculated as ordered by the Authority separately.
v. These liabilities shall also be signed off by all the general insurers.
vi. Based on the actuarial calculations each general insurer shall submit the details of the calculations to the pool administrator who shall verify the same.
vii. The pool administrator after verifying shall allocate the amounts to be transferred by one insurer to other insurers the net balances after due process of reconciliation.
viii. Following such an agreement, it shall be the responsibility of the insurer to service and settle the claims under the motor third party insurance policy to the satisfaction of the claimant.
ix. The process of clean cut transfer shall be overseen by the following committee:
a. Member (Non-Life) – Chairman
b. Head of Department (Non-Life) – Member Convenor
c. Head of Department (Actuarial) – Member
d. Appointed Actuary of the Indian Motor Third Party Insurance Pool – Member
e. Pool Administrator – Member
f. Secretary General, General Insurance Council -Member
g. Auditor Appointed by the Authority – Member
x. The pool administrator shall get the Third Party Pool Accounts of the members of the Indian Motor Third Party Insurance Pool audited by a chartered accountant firm approved by the Authority expeditiously, not later than 30-6-2012.