IRDAI has exercised the applicability of Section 6A (4) (b) of the Insurance Act, 1938

May 12, 2021 | by Avantis RegTech Legal Research Team

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Industry Specific Compliance

The Insurance Regulatory and Development Authority of India (IRDAI) on May 11, 2021 has issued a circular for the exercise of employee stock options (ESOP’s) and the applicability of section 6A (4)(b) of the insurance Act, 1938. 

The following clarifications have been given regarding the same: 

• All the ESOP’s at the time of grant shall be reported to the authority preferably as a part of the application filed. 

• Where specific trust has been formed by an insurer for issuance of ESOP’s to their employees, the issue of shares to such trust and exercise of option by one or more employees shall also fall within the same ambit. 

• The prior approval of the authority shall be taken for the exercise of the ESOP by one or more KMP’s whether singly or jointly. 

[Circular No. IRDAI/F&I/MISC/CIR/134/05/2021]

 


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