Section 3A of IA : Section 3A: Payment Of Annual Fee By Insurer

Explanation using Example

Imagine a company called "SafeHeaven Insurance" that provides health insurance plans to consumers. They have a certificate of registration from the insurance regulatory authority, which allows them to operate legally. According to Section 3A of The Insurance Act, 1938:

• Each year, SafeHeaven Insurance must pay an annual fee to the regulatory authority to maintain their registration.
• If SafeHeaven Insurance forgets or neglects to pay this fee, their registration certificate could be at risk of being cancelled, which would mean they could no longer legally sell insurance plans.

In this scenario, to comply with the law and continue their business operations without interruption, SafeHeaven Insurance ensures they pay the specified annual fee on time every year.