Life CEOs can join overseas boards: IRDA

HYDERABAD: IRDA has allowed CEOs of life companies to be directors on boards of insurance companies overseas. In its final guidelines on corporate governance, IRDA has, however, made it clear that a CEO of a life insurance firm will be prohibited from being a director on the board of any other Indian insurance company, bank or investment company. This is in sync with the insurance law.

However, such a restriction is not in place for CEOs of non-life companies. The insurance regulator has also advised insurers to have a whistle-blower policy allowing employees to raise concerns internally on possible irregularities in financial reporting and governance weaknesses. Insurers, though will have the flexibility in designing their whistle blower policies.

All insurers have to mandatorily set-up a policy holder protection committee that will, among other things, monitor misselling of insurance products and oversee the conduct of market intermediaries.

The norms are more stringent for life insurers, with the IRDA making it mandatory for them to set up an asset-liability management committee. The idea is to ensure that investments are done in a way that would enable the firm to meet its cash flow and capital requirements at a future date.