Master Direction - Insurance (Updated as on December 07, 2021)
UR
- Applies toAll regulated entities
- StatusIn force
- ImportanceFOR INFORMATION
- IssuedNov 17, 2016
- Amendmentsnone tracked
- Length33 points in 3 sections · 4 min read
The four dates on this rule
- PublishedNov 17, 2016The day RBI put this document out.
- Starts to applyNot statedNot stated separately in this document. Read the rule itself before you assume a start date.
- Time to get readyNot statedCannot be worked out until the day it starts to apply is known.
- Last date to actNot statedNo date to act by was found in this document. Other dates may sit inside single paragraphs.
Kept in your browser only. Your desk
Show me the points for
Nothing is removed from the page.
Show me the points about
30 of the 33 points name no product and bind every product. All products.
What it says
Must know
1. Covers residents buying insurance abroad
This applies to any Indian resident buying health, general or life insurance from abroad.
2. No insurer without IRDAI nod
A property, ship or plane in India cannot be insured abroad without IRDAI's OK.
3. Marine war-risk cover stays local
All-risk marine insurance against war and civil unrest must be bought only from Indian insurers.
4. Maturity money in 7 days
The policyholder must send maturity money back to India in seven days.
5. Claim currency follows the premium
A claim is paid in rupees if the premium was in rupees, in any currency if paid abroad.
6. Foreign firm's asset stays rupee
Insurance on an Indian asset owned by a foreign company's branch must be issued only in rupees.
7. Nepal, Bhutan count as Indian
Indians, Nepalese and Bhutanese living in Nepal or Bhutan are treated as Indian residents for rupee deals.
8. Nepal, Bhutan claims need approval
Paying a Nepal or Bhutan claim in foreign currency needs RBI's prior approval.
9. Applies to authorised dealer banks
It also covers banks that handle these insurance payments.
10. Check the claim was admitted
A bank pays a foreign-currency claim only after the insurer has admitted it.
11. Never pay resident in forex
A resident beneficiary must never be paid the claim in foreign currency.
12. Export claim needs forex proof
An export insurance claim is paid only once the exporter's forex receipt is confirmed.
13. Board must approve reinsurance yearly
An insurer's own Board must approve its re-insurance deals every year.
14. Keep only minimum forex balances
An insurer must keep only a small forex balance abroad.
15. Insurer invests abroad without approval
An insurer may invest its own foreign funds abroad without asking RBI first.
16. Posting capped at three years
A foreign national counts as 'not permanently resident' only if the India posting is three years or less.
17. Returning OCI needs remitted premium
A returning OCI can buy a forex policy only using money sent from abroad.
18. Rupee policy needs RBI approval
A rupee life policy cannot be turned into a forex policy without RBI's OK.
19. Three-year rule to keep policy
A returning resident can keep a foreign-currency policy only if it ran at least three years before return.
20. Seven-day rule for life claims
A returning resident must also send home a life-policy payout in seven days.
21. Life claim shares premium's split
A rupee life-policy claim is paid in foreign currency only in the same share as the forex premium.
22. Non-repatriable premium means rupee payout
If premium was paid in non-repatriable rupees, the claim is paid only in rupees, to an NRO account.
23. Same rule for life insurers
A life insurer must also send home any spare forex balance often.
24. Life insurer gets same freedom
A life insurer may also invest its foreign funds abroad without RBI's prior approval.
25. Overseas office costs paid freely
An insurer may freely use its foreign funds for its overseas office's normal running costs.
26. Retirement dues paid from funds
Retiring overseas staff can be paid provident fund and gratuity from those same funds.
27. Staff loan recoveries stay forex
A loan against an overseas staff member's provident fund must be repaid only in forex.
Do it
1. Get documents before accepting premium
A bank must check papers before taking premium paid in forex.
2. Cashless claims can pay hospital
A cashless health claim abroad can be paid straight to the treating hospital.
3. Brokers need an accountant's certificate
A broker must get an accountant's note before sending premium abroad.
4. Brokers must show IRDAI's letter
A broker must also show IRDAI's letter that allows business abroad.
Background
1. Rules come from two notifications
These insurance foreign-exchange rules trace back to two RBI notifications from 2000 and 2015.
2. IRDAI registers every insurer
Every insurer here must be signed up with IRDAI.