Section 114A of IA : Section 114A: Power Of Authority To Make Regulations

Explanation using Example

Imagine a scenario where the Insurance Regulatory and Development Authority (IRDA) in India, which is the "Authority" referred to in Section 114A of The Insurance Act, 1938, decides to introduce new regulations to enhance the digitalization of insurance policies. To do this, they use the power given to them under Section 114A to create a regulation that mandates all insurance companies to issue electronic insurance policies to their customers.

Under this new regulation, the IRDA specifies:

• The manner and form in which electronic insurance policies are to be issued, ensuring security and authenticity (relating to point 2(l) in Section 114A).
• Requirements for insurers to maintain digital records of policies and claims (relating to point 2(k) in Section 114A).
• Standards for the protection of policyholders' data and privacy in the electronic issuance and maintenance of policies (relating to point 2(z) in Section 114A).

Once the IRDA drafts and notifies these regulations, insurance companies will have to comply by updating their systems and processes to issue electronic policies. This change aims to make insurance documentation more accessible, secure, and environmentally friendly by reducing the need for paper.