Domestic and foreign insurance companies have been permitted to set up IFSC Insurance Office in special economic zones if they meet certain conditions.
IRDAI’s International Financial Service Centre (IFSC) guidelines, 2015 state that all the Indian and foreign insurers who fulfil the conditions are eligible to set up IFSC Insurance Office (IIO) in SEZs.
IRDAI’s guidelines to setup offices in SEZs:
Insurers should obtain prior approval of Insurance Regulatory and Development Authority of India (IRDAI).
Insurer should be in continuous operation for 5 years, and must have a satisfactory track record in respect of regulatory or supervisory compliance.
IRDA’s guidelines for reinsurance business:
Allotted capital of Rs. 10 crore-
a. Held in form of Government Securities (Gsec) or
b. Held as deposits with scheduled banks in India
There are special provisions for conducting business in SEZ, so the regulator felt the need for separate regulations.
In case of direct insurance, the Indian insurers (except a statutory body) may also establish an IIO to transact a specified direct insurance business in an SEZ.
