The Insurance Regulatory and Development Authority of India (IRDAI) issued a circular on 6th September 2024, revising provisions under the IRDAI (Registration, Capital Structure, Transfer of Shares and Amalgamation of Insurers) Regulations, 2024. The circular updates paragraph D.2 of the Master Circular on Registration, 2024, replacing it with new guidelines regarding the subscription of other forms of capital (OFC) by insurers. Under the revised regulation, entities eligible to subscribe to insurers’ OFCs include those incorporated, set up, or registered under Indian law, or any entity established in a Financial Action Task Force (FATF) compliant jurisdiction. The circular emphasizes compliance with applicable laws, including those related to taxation, foreign exchange, anti-money laundering, and terrorism financing. This change is effective immediately, and any OFCs issued prior to this date will be governed by the original terms of their issuance. These revisions aim to provide clarity and ensure regulatory compliance for insurers.
INSURANCE REGULATORY AND DEVELOPMENT AUTHORITY OF INDIA
Circular Ref: IRDAI/F&I/CIR/Misc/119/9/2024 Date: 06.09.2024
Subject: Subscribers to Other Forms of Capital
The Authority has notified the IRDAI (Registration, Capital Structure, Transfer of Shares and Amalgamation of Insurers) Regulations, 2024 (herein after referred to as “Registration Regulations, 2024”). Pursuant to the same, the Authority has issued Master Circular on Registration, Capital Structure, Transfer of Shares and Amalgamation of Insurers, 2024 dated 15.05.2024 (hereinafter referred to as “Master Circular on Registration, 2024”) to provide clarifications on various provisions of Registration Regulations, 2024.
In exercise of the powers conferred by section 34 of the Insurance Act, 1938 (hereinafter referred to as “the Act”), section 14 of the IRDA Act, 1999 and Regulation 50, 59 and 60 of Registration Regulations, 2024, para D.2 of the Master Circular on Registration, 2024 is substituted as under:
“D.2 With respect to Regulation 50 of Registration Regulations, 2024: The other forms of capital issued by any insurer may be subscribed by any of the following entity(ies), subject to compliance with all other applicable laws including but not limited to laws pertaining to taxation, foreign exchange, anti-money laundering, combating the financing of terrorism:
1. Any entity incorporated, set-up or registered under any law for the time being in force in India; or
2. Any entity incorporated, set-up or registered under any law for the time being in force in any Financial Action Task Force compliant jurisdiction.”
This Circular will come in force from the date of issuance. Any OFC issued prior to this Circular will continue to be governed by the terms of issuance of the said OFC.
This has approval of the Competent Authority.
Sd/-
G. R. Surya Kumar
Chief General Manager
