As you are aware, no appointment, re-appointment or termination of CEO, Whole-time Director or Managing Director of an insurance company is valid unless the previous approval of this Authority, in terms of Section 34A of the Insurance Act, 1938, is obtained. It is observed that insurers seek approvals without providing adequate time to examine such proposal and there are instances where approvals have been sought post facto. We advise that the prior approval of the Authority is a statutory requirement and clearance would be subject to detailed due diligence conducted by the Authority. In view of the above, all the insurers are hereby advised that such references seeking prior approval should be made in the format enclosed herewith and should reach the Authority at least 30 days prior to the commencement of appointment to allow sufficient time for the Authority to examine such proposals and accord approval. Please Acknowledge receipt and ensure strict compliance of the aforesaid statutory requirements.
(C R Muralidharan)
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