The Author, Rashi Bhatia, 4th Year, B.A.LL.B, Mody University of Science and Technology, Rajasthan. She is currently interning with LatestLaws.com.
INTRODUCTION-
The Actuaries Act provides for regulating and developing the profession of Actuaries and others matters related to actuarial society. The Act gives benefit to the members to have practice in an actuarial science and its application. The Actuaries Act is definitely a great aid to the economic sector in India.
Q.1 When did the Actuaries Act, 2006 Came into Force?
Ans. The Actuaries Act came into force on 10th of November 2006.
Q.2 What is Actuary and Actuarial Science?
Ans. Actuary is defined under section 2(a) of the Act which means
- a person skilled in determining the current effects of future contingent events or,
- In finance modeling or risk analysis in various areas of insurance or,
- Calculating the value of life interests and insurance risks or,
- Designing and pricing of policies, working out the benefits, recommending rates relating to insurance business and pension rates.
- Includes a statistician engaged in such technology, taxation, employees benefit and other risk management and investments and who is a fellow member of the Institute.
Actuarial Science is the discipline that applies the methods used in Statistics and Mathematics to assess the risks in finance, insurance, pension and other industries and professions too.
Q.3 What is the aim of the Actuaries Act?
Ans. The objective of the act to provide the benefit to the actuaries in an insurance company. The act aim is the upliftment of actuaries .The act permits the setting up of institute of actuaries.
Q.4 What are the objects of the Institute of Actuaries of India (IAI)?
Ans. IAI is statutory body under this act. It regulates the Actuarial Profession in India. The main objects of the Institute of Actuaries of India are :-
- To promote, uphold and develop the standards of professional education, training, knowledge, practice and conduct amongst Actuaries;
- To promote the status of the Actuarial profession,
- To regulate the practice by the members of the profession of Actuary;
- To promote, in the public Interest, knowledge and research in all the matters relevant to Actuarial Science and its application;and
- To do all such things as may be incidential or conducive to the above object or any of them.
Q.5 What is the composition of Council of Institute?
Ans. The Council members composed of:
- a minimum of nine and maximum twelve persons from amongst fellow members to be elected by the fellow and the associate members of the Institute.
- An officer not below the rank of joint secretary to the Government of India nominated by the central government.
- One person from the Insurance Regulatory and Development Authority under the Insurance Regulatory and Development Authority Act,1999.
- Not more than two persons having knowledge in the field of general and life Insurance, finance, economics and law, accountancy and any other discipline which includes the central government.
- No person holding a post under the Central government or a state government.
- One-third of the members retire on the expiration of every second year of rotation.
- Any person shall hold office for a period of six years from the date of nomination.
Q.6 What are the functions of the Council in this Act?
Ans. The functions of council shall consist of holding of examination of the candidates for enrollment, specifying the qualifications in the register, recognition of foreign qualifications and training for enrollment, maintenance and publication of a register who is practicing as Actuaries, levy and collection of fees from members and other persons, removal of the name from the register who has been removed, issue guidelines for the observance of the members including other persons, instituting and awarding scholarship, prizes and medal, by granting financial assistance to persons other than members of council, maintenance of a library and publication of books, periodicals and journals related to actuarial science and establishing regional councils from time to time decided by the headquarters etc.
Q.7 What is the process of registration of members?
Ans. The council has to maintain the register the member of the Institute. The register includes the particulars of the members of the institute are:
- Full name, date of birth, domicile, residential and professional address.
- Date on which the name is entered in register.
- Qualifications
- Whether he holds a certificate of practice, and
- Any other particulars.
- Every member of Institute shall enter his name in the register and pay annual membership fee.
Q.8 What is the term of office of members of Authority?
Ans. A person appointed as a member hold office for a term of 3 years from the date on which he enters in his office or till the age of 67 years, whichever completes earlier.
Q.9 In which court and matters powers are vested to Authority, Council, Disciplinary Committee and Prosecution director in the Actuaries Act, 2006?
Ans.The Powers are vested in a Civil Court under Code of Civil Procedure,1908 and respective matters are-
- Summoning and enforcing the attendance of any person and examine him on oath;
- discovery and production of any document; and
- Receiving evidence on affidavit.
Q.10 What is the time period of an appeal to the Authority after the order is communicated to him?
Ans.The Authority may entertain an appeal within ninety days from the date on which order is communicated to him.
In expectation cases, the authority may entertain an appeal after the said period expires,if the person satisfies the sufficient cause for not filing the appeal in the respective period.
Q.11 What is the Penalty to the person who is falsely claiming to be a member of Institute?
Ans. The Person who is falsely claiming to be member of Institute shall be punishable with fine which can be maximum of one lakh rupees on first conviction, and if any subsequent conviction with imprisonment maximum to one year or with fine also which may extend to two lakh rupees also.
Q.12 Which are the companies who can engage in actuarial practice?
Ans. Any company cannot engage in actuarial practice, only the companies incorporated in India, shall practice as Actuaries.
If any company contravene shall be punishable with fine which may extend to 10,000 rupees on first conviction and if there is subsequent conviction then may extend to 25,000 rupees.
Q.13 What is the establishment of Quality Review Board?
Ans. The Central government constitute a Quality Review Board consists of Chairperson and members not more then four.
The Chairperson and members shall be appointed amongst the persons having eminence experience in the field of education, law, economic, business, finance, accountancy and public administration.
The two members are appointed by the council and other two are nominated by the Central Government.
Q.14 What are the Functions of Quality Review Board?
Ans. The Board shall fix standards for the service given by the members of the Institute;to review the quality of services provided by the members which includes actuarial audit services; and to guide the members of institute to improve the quality of services and regulatory requirements.
Q.15 What is the Maintenance procedure of more than one offices by Actuary?
Ans. An Actuary in practice or a firm of such Actuaries has more than one offices within India and outside too. Each one of such offices shall be in the separate charge of a fellow member of the Institute.
Every Actuary in practice or a firm of such actuaries maintaining more than one office shall send to the council in list of offices and the person in charge shall keep the council informed about the charges.
Q.16 How many Actuaries in the country and scope of Actuarial Science?
Ans. Presently, there are 325 (approx.) actuaries in India. In India, students are facing little difficulty in entrance. Basically, the demand depends upon Insurance Pentration and other economic factors. The fact is that actuaries are amongst the highest paid individual in current scenario. There are ample of vacancies but required a qualified person to solve a risk and problems related to it.
