Currently, IRDA inspects the books of insurance companies only once a year.
Mr C.S. Rao, Chairman, IRDA, said that after January 1, 2007, insurance companies will be competing on price as the terms of existing contracts would be maintained for about 15 months.
"We will be monitoring the solvency of general insurance companies on a quarterly basis, rather than an annual basis," Mr Rao said. He was speaking on the sidelines of the Asian Life Insurance Summit.
Around 70 per cent of the general insurance business such as fire and motor insurance are under tariff or a predetermined rate structure.
Insurance analysts say that if companies slash premium rates, it could erode their solvency. Mr Rao said that the IRDA held meetings with transporters' associations and that free pricing would also come into effect for motor insurance policies, including the commercial segment.
The transporters' lobby has opposed detariffing the motor portfolio and the regulator has so far been cautious about implementing a free-price regime in this line of business.
Since the claims ratio of insurance companies for commercial motor segment is above 200 per cent, transporters could expect a big jump in premium.
Mr Rao said at the seminar that the life insurance sector would see around 25-26 players in the next five to six years.
Companies that have so far expressed interest in setting up a life insurance joint venture include Punjab National Bank-Principal, IDBI-Federal Bank-Fortis, Pantaloon-Generali and Religare-Aegon.
Reliance Life Insurance Advisor :- Dhaivat Trivedi For More Detail :- ADDRESS RELIANCE LIFE INSURANCE CO. LTD. PERFECT POINT, 2nd floor, DR YAGNIK ROAD OPP RAM KRISHNA ASHRAM RAJKOT. - 360002 Tel : 0281 3018008 ,0281 3018009, 0281 3018010, 0281 3018012
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