To,

All General Insurers,
           
The Tariff Advisory Committee vide its circular ref. TAC/7/06 dated 4th December 2006 has decided that the rates, terms, conditions and regulations applicable to Fire, Engineering, Motor, Workmen’s Compensation and other classes of business currently under tariffs shall be withdrawn effective from 1 January 2007.

By virtue of the power vested in the Authority under section 14(2)(i) of the IRDA Act, 1999, it is hereby notified that the Tariff general regulations (other than those relating to rating), terms, conditions, clauses, warranties, policy and endorsement wordings applicable to the above mentioned classes of business as well as Marine Hull insurance business shall continue to be followed until further orders. The rates of premium may be varied subject to compliance with the Guidelines on ‘File and Use’ of General Insurance Products notified on 28th September ’06.

The rates of premium applicable to Motor Third Party insurance business shall be as set out in Annexure I. Insurers are advised to be mindful of the concerns expressed by vehicle owners about both the rates and availability of insurance. Considering the mandatory nature of Motor Third Party insurance, insurers are advised to ensure that Motor Third Party insurance is made available at all their underwriting branches and that requests for insurance are processed expeditiously and policies are issued promptly. The Authority will treat any complaint of non-availability of insurance or use of methods to put off the client seeking insurance, seriously.

In respect of all classes of business where the rates applicable are now controlled by tariff, insurers are not permitted to cancel the current insurance policies and issue fresh policies covering substantially the same properties or interests, in order to alter the rates of premium offered to the client. The insured is free to cancel its insurance at any time as per the relevant policy conditions in which case, premium at short-period rates as applicable shall be charged for the period on risk.

Insurers are advised to ensure that proper underwriting standards are maintained even after the tariffs are withdrawn.



(C. S. Rao)
Chairman