TAC on general insurance to be recast

NEW DELHI, AUG 8: The Tariff Advisory Committee (TAC) on general insurance will have to be recast once the insurance sector is opened for private players to reflect the new environment, the secretary of TAC C N Ravi told The Indian Express. The TAC will work in tandem with the Insurance Regulatory Authority (IRA) to fix tariff rates and regulate the sector. Even though there will be a reduction in the tariff regime once competition is introduced in the sector, the TAC will continue to play an important role in the sector by rating insurance products.

Explaining the role of TAC in a liberalised future, Ravi said that the opening up of the sector and the setting up of IRA would not affect the existence of TAC. But he said that the structure, role and functions of TAC will have to undergo changes. “Most likely the Chairman of TAC will also be made the chairman of TAC,” he said.

The TAC is a 15 member statutory body set up under the Insurance Act of 1938 which decides the premia for most general insurance categories.

Currently the chairman of GIC is the chairman of TAC. The rest of the members are the CMDs and top executives of GIC’s four subsidiaries.