CCI refuses to interfere in IRDAI’s regulatory functions

CCI refuses to interfere in IRDAI’s regulatory functions

Subject: Economy

Section: Msc

Context:: Regulatory power of Competition Commission of India (CCI) only includes regulating of markets and does not extend to monopoly over regulatory powers, says CCI in case involving IRDAI’s Indian Institute of Insurance Surveyors and Loss Assessors (IIISLA).

Key Points:

• CCI has refused to interfere in  IRDAI’s regulatory functions, disposing off an information case alleging anti-competitive arrangement between the insurance regulator and the Indian Institute of Insurance Surveyors and Loss Assessors (IIISLA).
• As per the informant, IRDAI had created a statutory monopoly in favour of IIISLA by mandating the membership as an eligibility criterion for grant and renewal of licenses and IIISLA had abused its dominant position by withholding the grant of membership due to non payment of past dues of annual subscription to IIISLA.
• What is IIISLA?
  • The Indian Institute of Insurance Surveyors and Loss Assessors (IIISLA) was formed as Sec.25 company in 2005 and promoted by Insurance Regulatory and Development Authority of India (IRDA) for the holistic development of the profession of Surveying and Loss Assessment.
  • It functions under the IRDAI Act. Membership of IIISLA was  made mandatory by IRDAI for grant and renewal of licence for Surveyors and Loss Assessors.
  • Although promoted by IRDAI, it is a union of Independent practicing surveyors, and not directly controlled by IRDAI.
  • Insurance Surveyors and Loss Assesors are regulated under the IRDAI (Insurance Surveyors and Loss Assessors) Regulations, 2015.
  • Consequent upon promulgation of Insurance Laws (Amendment) Act, 2015, insurance surveyors and loss assessors are included in the definition of intermediary and insurance intermediary.
• It may be recalled that the  Delhi High Court had last month ruled that regulatory powers exercised by statutory bodies are not subject to competition watchdog’s oversight.
• Delhi High Court had highlighted that CCI’s power is for regulating markets and it does not extend to addressing any grievance regarding arbitrary action by any statutory authority.
• Who is a Surveyor and Loss Assessor ?
  • A surveyor and loss assessor is an insurance intermediary licensed by IRDAI to investigate, manage, quantify, validate and deal with losses (whether insured or not) arising from any contingency, on behalf of insurer or insured and report thereon.
  • Responsible for carrying out the work with competence, objectivity and professional integrity by strictly adhering to the code of conduct stipulated under the Law/Regulations.