Exposure Draft – Guidelines On Conflict Of Interest

The provisions of the Insurance Act 1938 (Insurance Act) provide guidance on certain conflict of interest situations. Section 48A and 48B of the Insurance Act provide the norms regarding common directors between an insurance company and an insurance agent/intermediary. In addition, per Section 32A of the Insurance Act, a managing director or other officer of an insurer carrying on life insurance business is prohibited from being a managing director or other officer of any other insurer carrying on life insurance business or of a banking company or of an investment company.

However, with the rapid growth of the insurance industry in the past few years there has been a surge in insurance companies and insurance intermediaries, with multiple insurers often being set up under the umbrella of the same corporate group. This has also led to an increase in the common directors between various insurance entities and therefore, an increase in situations where such directors