A Banking and Insurance Project Report on

A banking project on UNION Bank

Submitted To:
THE CHARUTAR VIDYA MANDAL UNIVERSITY
VALLABH VIDYANAGAR

Submitted By:
Rohan Patel
Enrolment no 12103020801055
University Exam no: 55
Bachelors of Business administration
(Hons.)
Semester IV

S. G. M. English Medium College of Commerce and Management

(SEMCOM)
Vallabh Vidyanagar
Academic Year 2023-24

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 Certificate

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A study report on Union Bank of India
 Preface

We Vinit Suresh Bhai Patel & Rohan Vikeshbhai Patel from Bachelor of Business Administration (Homs.)
semester 4 presents the report of banking. This project report climaxes in what way or manner I this subject
industry bridges the break 'tween theoretical information and authentic efficient exposure. This project will
help Stu graduates catch practical information and uncovering concerning various facets of investment and
insurance. It will help undergraduates to request their science in a real-life the project report readiness and
allure study helped me to experience the hypothetical as well as the miscellaneous experienced uncovering’s
to the banking manufacturing and accept the various aids presented and differing risks faced by banks. It
admits me to have a mutual session accompanying investment stick which determines expected an amazing
knowledge excuse. It assisted us to learn various facets of banking more positively.

Date: 3rd February 2023

Place: Vallabh Vidyanagar
Rohan Patel

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 Acknowledgment

First of all, I will thanks to Mahadev for having such a beautiful life.

After that I am thankful to CVM university. And I also thanks to our acknowledgeable principle
DR. Swati Parab.

I would also like to express my gratitude and appreciation to those who gave me knowledge
to complete the project report. A special thanks to Dr Renil Thomas, he provided knowledge with the same,
he is more than a mentor.

I would also like to acknowledge the Shri Nikunj sir for providing the information for the same.

I also like to acknowledge my mother Mrs. Sonalben Patel and my beloved father Mr. Sureshbhai Patel.

A special thanks to my team mate, Rohan Patel, who came to bank to help me to complete the crucial report.
And thanks to all my friends.

Date: 3rd February 2023

Place: Vidhya Nagar
Rohan Patel

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 List of Abbreviation
Sr. No Acronym Full Form
1 Ltd. Limited
2 RTGS Real Time gross settlement
3 NEFT National Electronic Funds Transfer
4 DD Demand Draft
5 FD Fixed Deposits

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 Table of Content
Title Page
Certificate
Preface
Acknowledgement
List of Abbreviations
List of Table
List of Graph

Sr. No Content Page No

1. Chapter-1 (Banking Facilities &Laws) 7 to 10
• Clearing System
• Locker Facility
• RTGS
• NEFT
2. Chapter-2 (Recovery Mechanism of Bank) 11 to 12
• Bank precautions while giving the loan
• Recovery procedure of the bank
• Factoring services
• Debt recovery tribunals
Chapter-3 (Closing of Accounts Situation and
3 13 to 18
Procedures)
• Circumstance Lending to Closure of Accounts
• Procedure For the Closure of The Bank Account
• Modes of termination of accounts
• Handling of deceased customer’s accounts

Chapter-4: IRDA(Insurance Regulatory Development

4 19 to 22
Authority
• Missions and Composition and Expectations of IRDA
• Duties and powers and functions of IRDA
• Agents and Corporate agents Code of Conduct,
Qualifications, Functions, Validity and renewal of license
applicable to agent
• Third Party Administrators(TPA)- Definition, procedure
for obtaining a license- revocation and cancellation
5 1. Chapter-5: Protection for Policy Holders 23 to 26
• Matters to be stated in Life and General Insurance Policy
• Policy holders servicing procedures- Claim procedures for
Life and General Insurance Policies
• Dispute resolution Mechanism- Consumer Protection Act-
Feature and Structure- Appeals and Penalties
• Ombudsman- Objectives, Powers, Duties
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 CHAPTER-1

1. Various laws related Remittance facilities offered by banks

The following laws and rules apply to the remittance services provided by banks in India:

• The RBI is given authority to oversee and control the banking industry, including remittances, by the Reserve
Bank of India (RBI) Act.

1. The Foreign Exchange Management Act (FEMA), which regulates all international financial transactions in
India, including remittances, strives to encourage the orderly growth and upkeep of the country's foreign
exchange market.

2. The Payment and Settlement Systems Act - This law establishes guidelines for the regulation and oversight of
remittances as well as other payment and settlement systems.

3. The Prevention of Money Laundering Act (PMLA), which also covers remittances, stipulates steps to stop
money laundering, such as the reporting of questionable activities

2. Clearing System
• Clearing describes the settling process that financial transactions must go through. Although paying for
items with a paper cheque is increasingly uncommon, this provides one of the most accessible clearing
examples to understand. When a buyer pays a seller with a cheque, the seller deposits this cheque into his or
her bank account. It then takes several days for the cheque to ‘clear’ and for the funds to appear in the
account.

• Indian public sector banks include Union bank of India. The process of settling transactions between banks
is referred to as clearing. National clearing Cell (NCC) and Real Time Gross Settlement (RTGS) are the two
primary clearing systems utilized by banks in India. The RBI oversees the NCC, a centralized clearing
house for interbank transactions. Through a common platform, this method makes it easier to move money
across banks.
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• The RBI offers the real time interbank electronic money transfer service. Large value transactions are carried
out using RTGS, which enables immediate money transfers between banks. Both of these clearing systems,
in which Union Bank of India participates, allow for the transfer of money between banks for its clients.
Customers of the bank may start these transactions via the bank’s branch locations, online banking, or
mobile banking application.

➢ Cheque Details Required:

• Account Number

• Cheque Number

• Payee Name

• Cheque Amount

• Cheque date

• Transaction Code

• MICR Code

• Short Account Number

3. Locker facilities

The locker facility is considered to be a safe and secure way of storing valuables as it reduces the risk of loss
or theft, and provides customers with peace of mind. Union Bank of India offers locker facilities in different
sizes and rental rates, and customers need to submit specific documents and complete the formalities to avail
of this service.

Safe Deposit Locker facility is one of the value added services provided by the Bank to its customers. Bank
provides specially designed lockers purchased from reputed manufactures which are kept at specially built
strong rooms at branches for keeping the valuable of hirers. Safe Deposit Locker facility is available at our
various branches across India. Lockers of different sizes to suit the needs of customers are available. Safe
Deposit Locker facility can be availed by individuals – either singly or jointly, Partnership Firms,
Companies, Associations and Clubs. Safe Deposit Locker facility is available at our various branches across
India. Lockers of different sizes to suit the needs of customers are available. Rent for Safe Deposit Lockers
is charged annually and rent is payable in advance. Locker hirers have option to pay 3 years rent in advance.
Locker rent vary depending on location of branch i.e. rural/semi-urban/urban/metro and size of locker.

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1. Who can use locker facilities
Generally, locker facilities are available to the customers of the bank or financial institution that provides the
service. This means that you would need to have an account or some other type of relationship with the bank
to be eligible for a locker. Additionally, some banks may have specific eligibility criteria, such as a minimum
balance requirement or credit history, that customers need to meet in order to obtain a locker. It's recommended
to check with your specific bank or financial institution for more information on their locker facility eligibility
criteria.

2. Documents required to open locker in banks

The specific documents required to open a bank locker may vary by bank and country, but typically you will
need to provide the following:

❖ A completed application form provided by the bank.

❖ Proof of identity, such as a passport, driver's license or PAN card.

❖ Proof of address, such as a utility bill or rental agreement.

❖ Two passport-sized photographs.

❖ Nomination form, in case you want to nominate someone to access your locker in your absence.

Some banks may require additional documents or information, so it's best to check with your specific bank for
their exact requirements

3. Timing to avail locker facilities in banks

The person who has locker in bank can avail its facilities only in working bank days.

4. NEFT (National Electronic Funds Transfer)

➢ NEFT Timing

As per RBI Guidelines the timings for NEFT are 8 AM and 06:30 PM on all weekdays and between 8 AM
and 06:30 PM on Saturday (except 2nd & 4th Saturdays).

➢ NEFT limit

As of September 2021, the NEFT (National Electronic Funds Transfer) limit for Union Bank of India is as
follows:

For retail customers:

o Minimum transfer limit: Rs. 1

o Maximum transfer limit: Rs. 10 lakhs per transaction

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 For corporate customers:

o Minimum transfer limit: Rs. 2 lakhs

o Maximum transfer limit: No limit.

➢ NEFT Process

The process for making a NEFT (National Electronic Funds Transfer) transaction in India typically involves
the following steps:

o Log in to your internet banking account or visit your bank branch.

o Select the NEFT option and provide the necessary details of the beneficiary (such as name, account number,
IFSC code, and transfer amount).
o Verify the details and confirm the transaction.
o The amount will be debited from your account and transferred to the beneficiary's account through the NEFT
system.

➢ NEFT Charges

▪ For transaction amount up to Rs. 10,000 : Rs. 2.50 + taxes.

▪ For transaction amount above Rs. 10,000 & up to Rs. 1 Lac : Rs. 5.00 + taxes.
▪ For transaction amount above Rs. 1 Lac & up to Rs. 2 Lacs : Rs. 15.00 + taxes.
▪ For transaction amount more than Rs. 2 Lacs : Rs. 25.00 + taxes.

5. RTGS (Real Time Gross Settlement)

o RTGS Time

Service Timings Available 365days in 24*7

➢ RTGS Charges

1. Via net banking / mobile banking – free

2. Per transaction charges via branch

o Rs. 10000 Up to Rs. 2.50 Per transaction

o Rs. 10001 -1Lakh To Rs. 5 Per transaction
o Rs. 1,00,001 To Rs. 2 Lakh to Rs. 15 Per transaction
o Above Rs. 2 Lakh Rs. 25 Per transaction

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 CHAPTER-2

1. Bank precautions while giving the loan

a. Credit History: This tells them how consistently you’ve made payments on any loans, credit cards, or
mortgages in the past.

b. Capacity: The bank estimates how consistently you’ll be able to make payments based on your income and
other financial responsibilities.

c. Collateral: Any assets you own, like a car or a home, that the bank could take if you fail to pay.

d. Capital: Capital is usually the money you have in savings, investments, and retirement accounts that you
could use to pay the bank if you can’t repay the loan.

e. Conditions: The things a bank looks at before approving your loan, such as the market conditions or state of
the economy and other things that might affect how you can repay the debt.

2. Recovery procedure of the bank

A bank loan recovery is an essential process for the bank and the financial institutions offering loans. And
they conduct this process due to many reasons. However, one of the most common reasons is when their
customer or borrower fails to repay the EMI and the rest of the loan amount to the bank.

During the recovery process, the bank can include the debt or loan recovering team. Also, they can hire a
recovery agency, sell out the securities of borrowers held by the bank and take legal actions in court.

3. Factoring services
In order to satisfy its short-term liquidity needs, a business may use factoring, a sort of finance, to sell its
accounts receivable (invoices) to a third party. In the agreement between the two parties, the factor would pay
the invoices' outstanding balance less any commissions or fees.

Factoring implies a financial arrangement between the factor and client, in which the firm (client) gets
advances in return for receivables, from a financial institution (factor). It is a financing technique, in which
there is an outright selling of trade debts by a firm to a third party, i.e. factor, at discounted prices.

Factoring is a financial alternative, in the financing and management of account receivables. It states the
terms and conditions of the sale in the factoring agreement.
In finer terms factoring is a relationship between the factor and the client, in which the factor purchases the
client’s account receivables and pays up to 80% (sometimes 90%) of the sum immediately, at the time of
agreeing. The factor pays the balance sum, i.e. 20% of the amount which includes finance cost and operating
cost, to the client when the customer pays the obligation.

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4. Debt recovery tribunals

The Recovery of Debts and Bankruptcy Act, 1993 (RDB Act) provides speedy redressal to lenders and
borrowers through the filing of Original Applications (OAs) in Debts Recovery Tribunals (DRTs) and
appeals in Debts Recovery Appellate Tribunals (DRATs).

The Securitization and Reconstruction of Financial Assets & Enforcement of Security Interest Act, 2002
(SARFAESI Act) provide access to banks and financial institutions covered under the Act for recovery of
secured debts from the borrowers without the intervention of the Courts at the first stage. Securitization
Appeals (SAs) can be filed with the DRTs by those aggrieved against action taken by secured creditors
under the SARFAESI Act.

Debt recovery tribunals (DRTs) are special courts in India that deal with the recovery of outstanding debts
from borrowers. They were established under the Recovery of Debts Due to Banks and Financial Institutions
Act (RDDBFI Act) of 1993. DRTs have jurisdiction over cases related to the recovery of loans and dues
from banks and financial institutions, as well as cases involving individual and non-institutional borrowers.
They provide a mechanism for banks and financial institutions to recover bad debts quickly and efficiently.
The decisions of DRTs can be appealed to the Debt Recovery Appellate Tribunal (DRAT), and further
appeals can be made to the High Court and Supreme Court.

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 CHAPTER-3

Closing Of Accounts Situation and Procedures

1. Circumstance Lending to Closure of Accounts

A. Dormant Account

Generally, a bank considers an account “abandoned” if the account holder fails to initiate any activity over a
three- to five-year period, or if the account holder hasn’t contacted the bank during that time. The bank is
usually required to contact the account holder if it decides to close the account. If the money in an
abandoned account goes unclaimed by the account holder, the cash may be turned over to a state’s
unclaimed property program.

B. Zero Balance

If your account contains no money, the bank might close it. Simply because an account says there are no
minimums, does not mean the account should remain empty for days or months. The time frame will vary
based on your individual bank and its practices. Another risk you take is that any monthly fees could reduce
your balance to below zero, so it’s important to keep tabs on your bank account balances.

C. Too Many Transfers

Banks impose limits on how many transfers you can make between certain types of accounts, such as
checking accounts and savings accounts. If you exceed those limits, the bank might close at least one of the
accounts. Or, in the case of a savings account where you repeatedly exceed the regulation transfer limits, it
could be converted into a checking account instead.

D. Suspected Identity Theft

If your bank thinks you’ve been the victim of identity theft, it may close your account to prevent further
activity. The bank also might shut down your account if it suspects you’re committing suspicious or illegal
activity, such as money laundering. Large and regular transfers or withdrawals of money are among the
actions that may raise a red flag.

E. Criminal Conviction

If you have a previous criminal conviction that you didn’t report to your bank, but the bank then finds out
about it, the bank might close your account. Your account could also be closed if you’re convicted of a crime
after opening your account.

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2. Procedure For the Closure of The Bank Account

1) Open a new account

The first thing you need to do is open a new bank account. Having an account in place ensures you have a
place to transfer direct deposits and payments or debits.

2) Switch your existing scheduled payments and deposits

If you have any direct deposits or automatic payments set up, move them to the new account. Check with
your employer regarding any forms you need to fill out for direct deposit so your pay check can be rerouted
to the new account.

3) Transfer Your Money

Before you move money out of your account, let outstanding transactions clear. Failure to do so could result
in having to pay overdraft fees. If you still have money in the account after everything clears, withdraw the
money or transfer it to your new account.

4) Contact Your Bank

Cancel your bank account. Many financial institutions allow you to do this online, but it could require a
phone call to customer service or a visit to a local bank branch. Some banks and credit unions may require
you to fill out an account closure request form or submit a written request. Follow your bank’s guidance on
the proper contact method to start the closure process.

The bank will check your account to ensure it’s in good standing and that you’ve resolved any outstanding
issues before it marks the account as closed. If there are any remaining funds in the account, you should be
able to request a transfer to your new account or receive a check by mail.

5) If required, Send a letter to close your account

You can write a letter to your bank to close the account. To do so, you can use the template below or a
similar format.
Date
To whom it may concern,
Please close the following bank account(s):

• List account name and account number for each closing request

Please send a check for any remaining funds in those accounts to the address below. Please follow up with a
written confirmation to verify the previously mentioned accounts have been closed.
Please contact me if you have any questions.
Thank you,

Signature

Full name (Printed)

Mailing address

Phone number
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6) Get Written Confirmation

Don’t assume that the account is closed. The Consumer Financial Protection Bureau recommends getting
written confirmation when you close a bank account. This protects you if the bank doesn’t follow through or
some issue arises.

Having a list help ensure you’ve cancelled all of the payments attached to your old account, but you’ll also
be prepared when you need to set them up for your new bank account.

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Account Closure Form of Union Bank

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3. Modes of Termination of accounts

• Termination on your own volition:

The customer has the right to shut his demand deposit account for any reason, including a change of domicile
or dissatisfaction with the banker's service, and the banker is obligated to comply with this request. The
banker may also opt to cancel an account owing to poor account performance or because the customer is
unwanted for other reasons. A banker, on the other hand, can only shut an account after providing the consumer
adequate notice. However, because the cost of securing and starting a new account is substantially
more than the cost of shutting an account, such occurrences of account closure at the banker's
request are uncommon. If a customer instructs the banker to shut his account in writing,the banker is obligated
to do so. The latter does not need to inquire about the reasons for the former's decision. The account must be
cancelled as soon as possible, and the customer must return any unused checks.

• If the bank wants to close the account:

If an account is left unattended for an extended length of time, the banker may request that the money be
withdrawn. On the assumption that the consumer no longer requires the account, such action is
performed. If the customer cannot be located after a fair amount of time, the banker will normally move
the balance to a "Unclaimed Deposit Account" and cancel the account. The remaining sum is paid to the clients
as soon as he is located.

• Lawful termination:

A banker-customer relationship can also be ended by legal action and the occurrence of the following events:

➢ Client bankruptcies:

A customer may be declared bankrupt, or a firm may be wound up, depending on the law. In this case, no
withdrawals from the individual's or company's account would be permitted. The account is closed after the
balance is delivered to the Receiver, Liquidator, or Official Assignee.

➢ Garnishee Order:

The account can be closed as one of the possibilities after receiving a garnishee order from a court or an
attachment order from the Internal Revenue Service.

➢ Customer Insanity:

Under Section 11 of the Indian Contract Act, 1872, a lunatic or person of unsound mind is not fit
to contract. Because the relationship between the bank and the customer is contractual, the bank will not
honour checks and may liquidate the account after getting notification of the customer's insanity and receiving
confirmation through medical studies.

➢ Termination by mutual agreement or resignation:

When an employee and employer agree to end the employment relationship, either because the employee has
found a new job or because the employer no longer requires the employee's services.

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4. Handling of deceased customer’s accounts
Deceased accounts are bank accounts that are owned by a person who is no more alive (deceased). Banks will
freeze the account(s) when they get notified that the account has been deceased. The money and belongings
(if stored in a bank locker) will be handed over to the legal heirs as per the court's directions.

When the account holder is no more, the legal heirs are to inform the banks at the earliest about the same.
They must notify the bank about the death by furnishing death certificate, ID proof, and account details (if
they know).

If there is nothing that the deceased person owes to creditors, then the proceeds from the deceased accounts
will be handed over to the legal heirs. If there is any unpaid debt, then the account balance would be
recovered by the creditors. The remaining amount, if any, will be handed over to the kins.

If the deceased accounts are pay-on-death accounts, then the bank will hand over the proceeds to
the nominee or beneficiary when the account holder gets deceased. The nominee or beneficiary should report
the death of the account holder with proper proof of identification.

The proceeds in the case of joint accounts held with a deceased person will result in the surviving owner
gaining full ownership over the account. The surviving owner may continue to operate on the account or
close the same. Joint accounts held with a deceased person are not considered deceased accounts.

Creditors are given the preference over legal heirs and kins when an account becomes deceased. Hence,
deceased accounts become extremely important for the lenders if the deceased has any unpaid debt. The
legal heirs and kins are not liable to settle the liabilities of the deceased, and therefore, the creditors can
recover their dues only by whatever is left in the deceased account and estate.

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 CHAPTER-4

1. Missions and Composition expectations of IRDA

The Insurance Regulatory and Development Authority of India (IRDA) is a statutory body that was established
in 1999 to regulate and promote the insurance industry in India. The mission of the IRDA is to protect the
interests of policyholders, ensure the growth and development of the insurance industry, and promote financial
stability and economic growth.

Composition:
The IRDA is composed of a chairman and five whole-time members who are appointed by the government of
India. In addition, the IRDA has four part-time members who are appointed by the government based on their
expertise in various fields such as insurance, finance, economics, law, and actuarial science.

Expectations:

The IRDA is expected to:

1. Regulate the insurance industry: The IRDA is responsible for regulating and supervising the insurance industry
to ensure that insurance companies comply with the regulatory framework and maintain financial stability.
2. Promote the development of the insurance industry: The IRDA promotes the development of the insurance
industry by encouraging competition, innovation, and the introduction of new products and services.
3. Protect the interests of policyholders: The IRDA ensures that policyholders' interests are protected by
monitoring insurance companies' compliance with regulations and investigating complaints.
4. Promote financial stability: The IRDA promotes financial stability in the insurance industry by monitoring the
financial health of insurance companies and taking corrective action if necessary.
5. Foster economic growth: The IRDA plays a critical role in fostering economic growth by promoting insurance
penetration, which helps mitigate risks and encourage savings and investment.

Overall, the IRDA's mission and expectations revolve around regulating and promoting a healthy insurance
industry that protects policyholders' interests, fosters economic growth, and contributes to financial stability.

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2. Duties and Powers and Functions of IRDA :

Duties and Powers of IRDA:

1. Registration and regulation of insurance companies: The IRDA is responsible for registering and regulating
insurance companies in India. It grants licenses to new insurance companies and ensures that they comply
with the regulatory framework.

2. Monitoring insurance companies: The IRDA monitors insurance companies' financial health and ensures that
they maintain solvency margins and comply with other financial regulations.

3. Protecting policyholders: The IRDA protects policyholders' interests by monitoring insurance companies'
compliance with regulations and investigating complaints.

4. Promoting competition and innovation: The IRDA promotes competition and innovation in the insurance
industry by encouraging the introduction of new products and services.

5. Conducting research and promoting awareness: The IRDA conducts research and promotes awareness about
the insurance industry, including its benefits and risks.

Functions of IRDA:

1. Licensing and registration of insurance companies, agents, and brokers.

2. Monitoring and supervising insurance companies to ensure that they comply with the regulatory framework.

3. Developing regulations and guidelines for the insurance industry.

4. Promoting the development of the insurance industry by encouraging innovation and the introduction of new
products and services.

5. Protecting the interests of policyholders by investigating complaints and taking action against insurance
companies that violate regulations.

6. Promoting public awareness about the benefits and risks of insurance products.

7. Promoting financial stability by monitoring insurance companies' solvency margins and taking corrective
action if necessary.

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 3. Agents and Corporate agents code of conduct, Qualification, Functions, Validity and
Renewal of license applicable to Agent :

Code of Conduct for Agents and Corporate Agents:

The code of conduct for agents and corporate agents includes the following:

1. Agents and corporate agents must act in the best interests of their clients.

2. They must provide accurate information about insurance products to their clients.

3. Agents and corporate agents must maintain confidentiality of their clients' information.

4. They must disclose any conflict of interest they have.

5. They must not misrepresent the features, benefits, or terms of insurance products.

6. Agents and corporate agents must comply with all relevant laws and regulations.

Qualification Requirements for Agents:

To become an agent, a candidate must meet the following qualification requirements:

1. They must be at least 18 years old.

2. They must have completed at least a 10th standard (or equivalent) education.

3. They must complete a pre-licensing training program approved by the IRDA.

4. They must pass an exam conducted by the IRDA.

Functions of Agents:

Agents have the following functions:

1. They solicit and procure insurance business.

2. They explain insurance products to potential clients.

3. They provide advice on the suitability of insurance products to their clients.

Validity and Renewal of Agent's License:

An agent's license is valid for three years from the date of issue. The license can be renewed for another three
years by submitting an application to the IRDA along with the renewal fee. The renewal application must be
submitted at least 30 days before the license expiry date.

Overall, the IRDA's regulations and code of conduct for agents and corporate agents help to ensure that they
operate in a professional and ethical manner, and that they provide accurate information and advice to their
clients. The qualification requirements, functions, and licensing procedures also help to ensure that agents are
adequately trained and regulated.

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4. Third party administrators (TPA) – Definitions, Procedure for obtaining a license –
revocation and cancellation :

In the Indian insurance industry, third-party administrators (TPAs) play an important role in providing services
such as claims processing, network management, and customer service on behalf of insurance companies. The
Insurance Regulatory and Development Authority of India (IRDAI) regulates the functioning and licensing of
TPAs.
Definitions:
A third-party administrator (TPA) is defined as any person or organization that provides administrative
services to an insurer, such as claims processing, record-keeping, and customer service.
Procedure for Obtaining a TPA License:

The procedure for obtaining a TPA license is as follows:

1. Application: The applicant must submit a duly completed application form to the IRDAI, along with the
necessary documents and fees.
2. Eligibility: The applicant must meet the eligibility criteria, which include minimum paid-up capital, net worth,
and financial requirements.
3. Background check: The IRDAI conducts a background check of the applicant to ensure that they are fit and
proper to act as a TPA.
4. Grant of license: If the applicant meets all the requirements, the IRDAI grants a TPA license, which is valid
for three years.
Revocation and Cancellation of TPA License:
The IRDAI can revoke or cancel a TPA license if the TPA violates any of the regulatory provisions. The
process for revocation or cancellation of a TPA license is as follows:
1. Show Cause Notice: The IRDAI issues a show cause notice to the TPA, giving them an opportunity to respond
within a specified time.
2. Inquiry: If the IRDAI is not satisfied with the TPA's response, it may initiate an inquiry.
3. Order: After completing the inquiry, the IRDAI may issue an order to revoke or cancel the TPA license.
4. Appeal: The TPA has the right to appeal the IRDAI's order before the Securities Appellate Tribunal (SAT).
Overall, TPAs play a critical role in the Indian insurance industry, and the IRDAI's regulations ensure that
they operate in a professional and ethical manner. The licensing process and the process of revocation or
cancellation of a TPA license help to maintain the quality and integrity of TPA services.

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 Chapter-5

1. Matters to be stated in Life and General Insurance Policy :

A life and general insurance policy is a contract between an insurer and a policyholder that provides financial
protection against various risks. The following are some of the matters that may be stated in a life and general
insurance policy:

1) Policyholder's name and contact information: This includes the full name, address, and contact details of
the policyholder.

2) Insured person's name and details: This includes the name, age, gender, and other relevant details of the
person who is being insured.

3) Policy period: This specifies the duration for which the policy will remain in force.

4) Premium payment details: This includes the premium amount, payment frequency, and the due dates for
premium payments.

5) Coverage details: This specifies the risks that the policy covers. For life insurance, this may include death,
accidental death, disability, and critical illness. For general insurance, this may include fire, theft, natural
disasters, liability, and more.

6) Exclusions: This specifies the situations or risks that are not covered by the policy. Common exclusions
include pre-existing medical conditions, war or terrorism, and illegal activities.

7) Policy benefits: This specifies the benefits that the policyholder or the insured person will receive in case of
a covered event. For life insurance, this may include a lump sum payment or a regular income. For general
insurance, this may include repair or replacement costs, liability coverage, and more.

8) Claims process: This specifies the process to be followed in case of a claim, including the documentation
required and the timeline for filing a claim.

9) Renewal details: This specifies the terms and conditions for renewing the policy at the end of the policy
period.

10) Termination clauses: This specifies the circumstances under which the policy may be terminated by either
the insurer or the policyholder.

11) Governing law: This specifies the jurisdiction whose laws will govern the policy.

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 2. Policy holders servicing Procedures -Claim procedures for Life and General Insurance
Policies :

The claim process for life and general insurance policies varies depending on the type of policy and the specific
insurance company. However, there are some general procedures that policyholders should follow when
making a claim:

I. Intimation: The policyholder must inform the insurance company about the claim as soon as possible after
the event that triggers the claim. The insurance company may have specific channels through which claims
must be intimated, such as a dedicated phone number, email address, or online portal.

II. Documentation: The policyholder must provide all the necessary documentation to support the claim. This
may include proof of loss or damage, medical reports, police reports, and other relevant documents.

III. Investigation: The insurance company may conduct an investigation to verify the claim and determine the
extent of the loss or damage. This may involve a site visit, interviews with witnesses, or other measures.

IV. Settlement: Once the claim has been verified, the insurance company will settle the claim as per the terms
and conditions of the policy. This may involve paying a lump sum amount or reimbursing the policyholder for
the loss or damage incurred.

For life insurance policies specifically, the following additional procedures may apply:

I. Death certificate: In case of a death claim, the policyholder must provide a death certificate as proof of the
insured person's death.

II. Nomination: If the insured person has nominated a beneficiary, the insurance company will settle the claim
in favor of the nominee. If no nomination has been made, the claim will be settled as per the legal heirship of
the insured person.

III. Maturity claims: For policies that have a maturity benefit, the policyholder must inform the insurance
company before the policy matures and provide all the necessary documentation to claim the benefit.

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3. Dispute Resolution Mechanism - Consumer Protection Act - Features and Structures -
Appeals and Penalties :

Dispute Resolution Mechanism refers to the process of resolving disputes or conflicts between parties
through a formal or informal process. In the context of consumer protection, it refers to the process by which
consumers can seek redressal of their grievances against sellers, manufacturers or service providers. The
Consumer Protection Act (CPA) is a legislation that aims to protect the interests of consumers and provides
a framework for resolving disputes.

Features and Structure:

The CPA has provisions for setting up consumer courts at the district, state and national levels. These courts
are empowered to hear complaints filed by consumers against businesses and service providers. The consumer
courts have a three-tier structure - District Consumer Disputes Redressal Forum, State Consumer Disputes
Redressal Commission, and National Consumer Disputes Redressal Commission. The forums are staffed by a
president and two members, while the commissions are staffed by a president and four members.

Appeals:

Consumers can file appeals against the decisions of the lower forums in higher forums. The appeal should be
filed within 30 days of the order of the lower forum. The higher forum has the power to either confirm, modify
or reverse the order of the lower forum.

Penalties:

The CPA has provisions for imposing penalties on businesses and service providers who violate consumer
rights. The penalties include compensation to the consumer, discontinuation of the unfair trade practice, and
payment of a fine. Repeat offenders can also face imprisonment.

In conclusion, the Consumer Protection Act provides a mechanism for the resolution of disputes between
consumers and businesses or service providers. The Act has a three-tier structure of consumer courts, with
provisions for appeals and penalties against violators of consumer rights.

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4. Ombudsman – Objects, Power, Duties :

An ombudsman is an independent official appointed by a government or organization to investigate complaints

made by individuals about the actions of the government or organization. The ombudsman is often considered
a neutral and impartial mediator between individuals and the government or organization, and their role is to
ensure that complaints are fairly and impartially investigated.

Objects:

The main object of an ombudsman is to protect the rights of individuals and ensure that they receive fair
treatment from the government or organization. They also serve as a watchdog to ensure that the government
or organization is operating in an ethical and responsible manner.

Power:

An ombudsman has the power to investigate complaints made by individuals against the government or
organization. They may have the power to request documents and information from the government or
organization and may conduct interviews with relevant parties. They can make recommendations to the
government or organization to correct any wrongdoing or improve their policies and procedures.

Duties:

The duties of an ombudsman include receiving and investigating complaints made by individuals, providing
information and assistance to individuals, and making recommendations to the government or organization to
improve their policies and procedures. They may also provide education and training to government officials
and employees on how to address complaints and improve their interactions with the public. In some cases,
an ombudsman may also act as a mediator to resolve disputes between individuals and the government or
organization.

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