In a setback to the Insurance Regulatory and Development Authority (IRDA), the Bombay High Court has passed an order, asking the regulator to set up a two-member committee on the application of renewal of a broking licence for Willis India Insurance Brokers (WIIB) that has been pending since April 2009 and pass a final order within a month.
"In our opinion, the application for renewal has been pending for a fairly long period," the October 21 order said.
WIIB, one of the country's largest insurance brokers, had filed for renewal of its licence in February 2009, three months before it was to expire. Meanwhile, a show-cause notice was issued to WIIB in January 2010. While the company responded to it, IRDA issued an impugned order. Surprisingly, when the company approached the court, IRDA withdrew both the show-cause notice and the impugned order. "IRDA unconditionally withdrew the show cause notice and impugned order before the high court was to pass the final order," said a source close to the development.
"A committee of two members of the respondent (IRDA) and preferably those who were not associated with this matter, shall hear and decide the renewal application dated February 16, 2009 on its own merits and without being influenced by any of the grounds set out in the impugned order," said the order.
When contacted, M. Ram Prasad, member, IRDA declined to comment on the order. A WIIB official too refused comment.
WIIB is not alone in facing such delays. The application of AON Global Insurance Brokers, one of the world's largest insurance brokers, has also been pending for more than a year.
The company expects its licence to be renewed soon as it has addressed the regulator's concerns.
"The regulator was not comfortable with certain individuals on AON's board to be on the board of other companies," said an official who refused to be identified. "The company has addressed those issues and the members have ended their association with other boards."