Section 24A of The General Insurance Business (Nationalisation) Act, 1972
1[24A. Exclusive privilege of Corporation and acquiring companies to cease.-- Notwithstanding anything contained in this Act, the exclusive privilege of the Corporation and the acquiring companies of carrying on general insurance business in India shall cease on and from the commencement of the Insurance Regulatory and Development Authority Act, 1999 and the Corporation and the acquiring companies shall, thereafter, carry on general insurance business in India in accordance with the provisions of the Insurance Act, 1938 (4 of 1938): 2[Provided that the Corporation shall, on and from the commencement of the General Insurance Business (Nationalisation) Amendment Act, 2002, cease to carry on general insurance business].]
Summary
- The exclusive privilege previously given to the Corporation and acquiring companies to carry on general insurance is ended.
- This loss of monopoly happens from the commencement of the Insurance Regulatory and Development Authority Act, 1999.
- After this change, the Corporation and acquiring companies must conduct their business according to the rules of the Insurance Act, 1938.
- From the commencement of the General Insurance Business (Nationalisation) Amendment Act, 2002, the Corporation itself must completely stop carrying on general insurance business.
Practical examples
FAQ
1. Do the acquiring companies still have a monopoly today?
No. Their exclusive privilege ceased when the Insurance Regulatory and Development Authority Act, 1999 commenced.
2. What laws must the acquiring companies follow to do business now?
After losing their exclusive privilege, they must carry on general insurance business in accordance with the provisions of the Insurance Act, 1938.
3. Does the Corporation still sell general insurance to the public?
No. The 2002 amendment specifically forced the Corporation to cease carrying on general insurance business.
Test yourself
Q1.Under Section 24A of The General Insurance Business (Nationalisation) Act, 1972, what event causes the exclusive privilege of the acquiring companies to cease?
Q2.Under Section 24A of The General Insurance Business (Nationalisation) Act, 1972, what happens to the Corporation on and from the commencement of the 2002 Amendment Act?
Q3.Under Section 24A of The General Insurance Business (Nationalisation) Act, 1972, after their monopoly ends, under which Act must the acquiring companies operate their business?
Q4.Under Section 24A of The General Insurance Business (Nationalisation) Act, 1972, how does the 2002 Amendment treat the Corporation compared to the acquiring companies?