TARIFF ADVISORY COMMITTEE (TAC)
TAC is the Statutory Body under Insurance Act 1938. Tariff Advisory Committee controls and regulates the rates, advantages, terms and conditions that may be offered by insurers in respect of General Insurance Business relating to Fire, Marine (Hull). Motor, Engg And Workmen Compensation. The main task of Tariff Advisory Committee is to regulate and control the rates, benefits, terms and conditions offered by life insurance companies in India.
The TAC Board has been reconstituted with seven members representing the present General Insurance Industry and eight members from government and Industry. The Controller of Insurance cum Chairman IRDA is the Chairman of TAC. TAC consists of Chairman, vice chairman and eight members. Tariff Advisory Committee has been designated by IRDA as the data repository for the non-life insurance industry. The transaction level data on Motor, Health and other lines are being collected for the Repository presently.
The Tariff Advisory Committee (“Advisory Committee”) is a body corporate, which controls and regulates the rates, advantages, terms and conditions offered by insurers in the general Insurance business. The Advisory Committee has the authority to require any insurer to supply such information or statements necessary for discharge of its functions. Any insurer falling to comply with such provisions shall be deemed to have contravened the provisions of the insurance Act. Every Insurer is required to make an annual payment of fees to the Advisory Committee of an amount not exceeding in case of reinsurance business in India, one parent of the total premiums in respect of facultative insurance accepted by him in India; and in case of any other insurance business, one percentage of the total gross premium written direct by him in India.
Powers of the TAC
- Power to control rates, advantages, terms and conditions in respect of risk other than life (general insurance): The Act empowers TAC to control and regulate the rates, advantages, terms and conditions offered by the insurers in respect of any class of risk and it shall be binding on all insurers. However, in certain cases it may permit any insure for a limited period (not exceeding 2 years) to adopt different rates from those fixed by it, subject to such conditions as may be imposed by TAC.
- TAC may require by notice under section 64 UE any insurer to supply necessary information within the period specified by it and failure to do so would be deemed as contravention of the Act.
- Section 64 UE empowers the Authority to depute any of its officers to make personal inspection of accounts, ledger etc. in order to verify accuracy of statements furnished by the insurer.
- TAC is also empowered to make arrangements for inspection on application of the insurer under sub- section (4) in respect of risks, adjustment of losses etc.
- TAC is empowered to constitute regional committees.
- The authority has been empowered under section 64 UB to make regulations in respect of functions to be performed by the TAC, terms of the office of its members. procedure for election & other matters relating to the transaction of its business.