LIFE INSURANCE CORPORATION
RULES, 1956
��������� S.R.O. 1889A � In exercise of the
powers conferred by section 48 of the Life Insurance Corporation Act, 1956 (31
of 1956), the Central Government hereby makes the following rules, namely:-
1.
Short title
� These Rules may be called the Life Insurance Corporation Rules, 1956.
�� [1]{2.�� Definitions-
In these rules-
(i)�
�Act� means the Life Insurance Corporation Act, 1956(31 of 1956);
����
[2]
[(i-a) �Chairman� means the Chairman appointed by the Central Government under sub-section
(1) of section 4];
(ii)�� �Section�
means a section of the Act;
(iii) �Tribunal� means the Tribunal
constituted by the notification of the Government of India in the Ministry of
Finance S.R.O. No.1734 dated
3. Term of
office of members-
1.� An
official member shall hold office during the pleasure of the Central
Government.
2.� A
non-official member shall hold office for a period of three2A years
unless a shorter period is specified in the order of appointment.
3.� An
out-going member shall be eligible for re-appointment.
���
[3][3A Office
of Chairman � The Office of the Chairman shall be whole-time]
4. Resignation
of members � The Chairman or any
member may, by writing under his hand addressed to the Central Government,
resign his office, and such resignation shall take effect from the date on
which it is accepted by the Central Government [4][or
on the expiry of thirty days from the date of resignation, whichever is
earlier]
5. Absence from
meetings � Any member who absents
himself from three consecutive meetings of the Corporation without leave of the
Corporation shall cease to be a member thereof.
6. Removal of a
member �
�(1)� The Central Government may remove any member,
who, in the opinion of that Government, has so flagrantly abused in any manner
his position as a member as to render his continuance as a member detrimental
to the public interest.
(2)
No member shall
be removed under sub-rule(1) unless he has been given a reasonable opportunity
of showing cause against his removal.
7. Casual
vacancies among members � In the
event of the occurrence of any vacancy in the office of a member by reason of
his death, resignation or removal, or otherwise, the Central Government may
appoint another person to act in his place.
8. Fees of
members � A member not being a
whole-time officer of the Corporation or an officer of the Central Government
shall be paid fees by the Corporation as follows:-
a. for attending meetings of the Corporation � [5][Rs.5000/-
]for each meeting;
[6][b� for attending meetings of any Committee
constituted by the Corporation-[7]{Rs.2500/-}
for each meeting as well as for visit to other places in connection with the
affairs of the Corporation.]
[8][ xxxxxxx����
xxxxxxxx��� ]
9. Traveling
and daily allowances �
����� (1) ������Every non-official member shall be
entitled to-
(a)� ��� traveling allowances for journeys performed
by him in connection with the work of the Corporation at the rates admissible
to officers of the first grade in the service of the Central Government;
� ������� Provided that every such member shall,
when traveling by rail, be entitled to travel by air-conditioned accommodation
if such accommodation is available.
�������
���������� [9]
[(b)� �������� (i)����� daily allowance as admissible to an
Officer in the highest grade of the Corporation; and
(ii)����� actual
expenses of lodging charged by the hotel other than a 5 star hotel and an
amount at the rate not exceeding the daily allowance specified in (i) as and by
way of boarding and incidental expenses.
Note: The total
duration of tour for which halting expenses are admissible shall be calculated
from the actual time or departure of the train or flight from the place of
residence of the Member by the last available train or flight up to the time of
the return thereto by the first available train or flight after completion of
official business.]
(2)
The traveling and
daily allowances of an official member shall be governed by the rules
applicable to him for journeys performed on official duty; and in case such
official member is not in the service of the Corporation, the Corporation shall
make necessary reimbursement to the authority employing such official.
10.
Apportionment of provident fund etc.-
(1) ��� where all
the employees of an insurer whose controlled business is transferred to and
vested in the Corporation under section 7 do not become employees of the
Corporation under section 11, all the moneys and other assets belonging to the
provident fund or superannuation fund or any other like fund referred to in
sub-section (1) of section 8 shall be apportioned between the trustees of the
fund and the Corporation in the following manner, namely;-
(i)
the moneys and
other assets of any provident fund shall be apportioned in the proportion which
the total of the amounts lying to the credit of the persons becoming employees
of the Corporation bears to the total of the amounts lying to the credit of the
persons who do not become employees of the Corporation;
(ii)
the moneys and
other assets of any superannuation fund shall be apportioned in the proportion
which the liability of the fund in respect of the persons becoming employees of
the Corporation bears to a similar liability in respect of the persons who do
not become employees of the Corporation, such liability to be ascertained on
such basis as may be determined by the Corporation and approved by the Central
Government; and
(iii)�
the moneys and other assets of any other like fund shall be apportioned
in accordance with the principles set out in clause (i) or clause (ii), as the
case may be.
(2)
The provisions of
sub-rule (1) shall, so far as may be, apply in relation to the valuation and
apportionment of moneys and other assets belonging to any provident fund or
superannuation fund or any other like fund referred to in clause (f) of
sub-section (2) of section 10, as they apply in relation to the apportionment
and valuation of moneys and other assets belonging to a provident fund,
superannuation fund or any other like fund referred to in sub-section (1) of
section 8.
Explanation � For the purposes of this rule the assets
of a provident fund, superannuation fund or any other like fund shall be valued
at the market rate as on the appointed day.
11.
Transfer of service of existing employees of chief
agents-The provisions of section 12
shall apply only in respect of the employees of a chief agent of an insurer who
was, under the terms of his contract with the insurer, required to render the
following services to the policyholders, namely:-
(a)�
collection of premiums from the
policyholders in respect of policies secured through his insurance agents in
the area for which he was appointed chief agent; and
(b)���� issuing
of final (pucka) receipts for the premiums so collected.
���
[10][12.������ Reference
to the Tribunal, etc.-
�(1) ������������ where the amount of compensation
offered under sub-section (2) of section 16 is not acceptable to an insurer, or
where the compensation offered under section 36 is not acceptable to a chief
agent or a special agent, the insurer, the chief agent or the special agent, as
the case may be, for the purpose of having the matter referred to the Tribunal,
apply to the Corporation along with the documents specified, if any, in this
behalf by the Tribunal in regulations made by it under section 17 (in this rule
referred to as the regulations)-
(a)
In cases where
the compensation was offered before the 1st day of November, 1964,
not later than the 31st day of January, 1965 or, if the applicant is
an insurer to whom compensation is payable under Part B of the First Schedule
to the Act, not later than the 31st day of April, 1965;
(b) In all other cases within three months from the date
on which the compensation is offered, or, if the applicant is an insurer to
whom compensation is payable under Part B of the First Schedule to the Act,
within six months form the date on which the compensation is offered.
(2)
�����The Corporation shall within three months
of the date of receipt of an application under sub-rule (1) refer the matter to
the Tribunal for decision along with a written statement and other documents
specified, if any, by the Tribunal in the regulations.
(3) (i) Where an
application under sub-rule (1) is made after the expiry of the period specified
therefore in that sub-rule, the Corporation shall, notwithstanding the
expiration of the said period, refer the matter within three months of the date
of receipt of the application to the Tribunal for decision along with a written
statement and other documents specified, if any, in the regulations.
(ii)The Tribunal may admit a reference made under
clause (i) if the applicant satisfies the Tribunal that he had sufficient cause
for not making the application to the Corporation within the period specified
therefor in sub-rule (1).
������ (4)�� An application to the Tribunal under section
15, or a reference to the Tribunal, other than a reference referred to in
sub-rule (2) or sub-rule (3), may be made-
(a) in cases, where the cause of action arose before the 1st
day of November, 1964, not later than 31st day of January, 1965,
(b) in all cases, within a period of three months from the
date on which the cause of action arose:
Provided that the Tribunal may admit an
application or a reference other than a reference referred to in sub-rule (2)
or sub-rule (3) after the expiry of the relevant period referred to in clause (a)
or clause (b) if the person making the application or reference satisfies the
Tribunal that there was sufficient cause for not making in within that period.]
[11] [12A. Jurisdiction
of Tribunal:- The Tribunal may exercise jurisdiction in the whole of
(i)
any question
whether of title or of liability or of any nature whatsoever in relation to the
assets and liabilities pertaining to the controlled business of an insurer
transferred to and vested in the Corporation;
(ii)
any question
under section 10 or under any rules made there under whether any property is or
was held or used by a composite insurer for the purposes of his controlled
business;
(iii)
every application
made under section 15 and all claims outstanding in respect of any transaction
which may be the subject matter of any such application determined in favour of
the Corporation;
(iv)
all claims for
compensation payable under the Act to insurers whose controlled business has
been transferred to and vested in the Corporation; and all matters connected
with the determination, payment and distribution of such compensation;
(v)
all claims for
compensation payable under the Act to chief agents or special agents for
contracts terminated under section 36; and all matters connected with the
determination, payment and distribution of such compensation;
(vi)
such
supplemental, incidental or consequential matters which the Tribunal may deem
it expedient or necessary to decide or determine for the purpose of securing
that the jurisdiction vested in it under the Act and in respect of matters
referred to above is fully and effectively exercised.]
13.� ������������ Compensation � The compensation payable
under the Act shall be paid in cash.
14. ������������� Employees
and Agents Relations Committee � The representatives of the Corporation on
the Employees and Agents Relations Committee constituted under sub-section (3)
of section 22 of the Act for each zonal office of the Corporation and the representatives
of the employees and agents on such Committee shall be nominated by the
Corporation.
15.� �� Term
of office of members of Employees and Agents Relations Committee-A member
of an Employees and Agents Relations Committee shall hold office for a period
of two years but shall be eligible for being re-nominated.
16.���� Causal vacancies in Employees and Agents
Relations Committee -
1.������ If any
casual vacancy occurs in the office of a member of an Employees and Agents
Relations Committee by death or resignation of such member or otherwise, the
Corporation shall as soon as may be after the occurrence of the vacancy take
immediate steps to fill the vacancy.
2.������ Every
member appointed to fill a casual vacancy of such Committee shall continue in
office for the unexpired term of his predecessor.
17.���� Report � The Annual Report to be submitted by the Corporation to the Central
Government under section 27 of the Act regarding its activities during the
previous financial year shall be in such form as the Central Government may,
from time to time, direct and shall inter-alia contain particulars in respect
of the following matters, namely;-
a.
the extent of the
new business;
b.
the total amount
of business in force;
c.
the total amount
of claims;
d.
nature of
investment; and
e.
the accounts
18.���� Allocation of paid-up capital of
composite insurer � For the purposes
of the Explanation to sub-section (2) of section 7 and of clause (b) of
sub-section (2) of section 10 of the Act, the part of the paid-up capital, or
assets representing such paid-up capital as the case may be, allocated to the
controlled business of an insurer shall be determined in the manner following
namely;-
(i)
in respect of an
insurer entitled to receive compensation under Part A of the First Schedule to
the Act, the paid-up capital allocable to the controlled business shall be that
proportion of the total paid-up capital of the insurer which the annual average
of the profits from the controlled business during the period covered by the
relevant actuarial investigation bears to the total of such annual average of
profits plus two times the annual average of the profits from other business
during that period;
Provided that the paid-up capital so allocable to the
controlled business shall not in any case exceed a sum of Rs.6 lakhs.
(ii)
in respect of an
insurer entitled to compensation under Part B of the First Schedule to the Act,
the paid-up capital allocable to the controlled business shall be the excess,
if any, of the amount of liabilities of the insurer appertaining to such
business in existence on the 19th day of January, 1956, computed as
at that date in accordance with the provisions of paragraph 4 of Part B of the
First Schedule to the Act over the value of the assets of the insurer
appertaining to his controlled business (excluding the paid-up capital
allocable to controlled business) in existence on the 19th day of
January, 1956 computed as at that date in accordance with the provisions of
paragraph 3 of Part B of the First Schedule to the Act.
Explanation 1 � �Profits from controlled business� means
the share of the surplus allocated to the shareholders as disclosed in the
abstracts prepared in accordance with Part II of the Fourth Schedule to the
Insurance Act in respect of the relevant actuarial investigations.
Explanation 2 � �Profits from other business� means
the total of the Profits less losses transferred to �Profit and Loss Account�
from the fire, marine and miscellaneous Insurance revenue accounts prepared in
accordance with Form F of the Third Schedule to the Insurance Act.
Explanation 3 � �Relevant Actuarial Investigations�
means such minimum number of latest actuarial investigations as it dates
earlier than the 1st day of January, 1956 (not being less than 2 in
any case) would leave the period intervening between the date as at which the
actuarial investigation immediately preceding the first of such investigations
was made and the date as at which the last of such investigations was made to
be not less than 4 years.
Explanation 4 � Where an insurer has allocated to
shareholders more than 5 per cent of any such surplus as is referred to in
Explanation 1, the insurer shall be deemed to have allocated only 5 per cent of
the surplus and where an insurer has not allocated any such surplus to
shareholders or has allocated to shareholders less than 5 per cent of any such
surplus the insurer shall be deemed to have allocated 5 per cent of the
surplus.
19.���� Transfer of business of certain
composite insurers to the Corporation �Every
transfer by the Administrator under clause (a) of section 45 of the Act shall
be made in pursuance of an agreement between the Administrator and the
Corporation and no such agreement shall be entered into except with the
previous approval of the Central Government.
20.���� Vesting of
the management of the affairs of the insurer in the persons entitled thereto-As soon as the transfer in terms of rule 19 is
effected, the Administrator shall by notice call upon the persons in charge of
the management of the insurer immediately prior to the appointment of the
Administrator to take charge of the management of any other kind of business
not transferred to and vested in the Corporation and upon such notice being
given, such persons shall take the management of that other kind of business.
1.1.2007
[1]
Subs. By G.S.R. 317 dated
[2]
Ins. By G.S.R. 1094 dated
[3]
Ins. By G.S.R. 317 dated
[4]
Ins. By G.S.R. 317 dated
[5]
Subs. By G.S.R. 474(E) dated
[6] Sub. By G.S.R. 1116(E) date 2.12.1988
[7]
Subs. By G.S.R. 474(E) dated
[8]
Omitted by G.S.R. 1101 dated
[9] Sub. By G.S.R. 1116(E) dated 2.12.1988
[10]
Sub. By G.S.R. 1568 dated
[11]
Ins. By G.S.R. 317 dated