Insurers allowed to pay profit related commission to non-executive director(s)

IRDAI vide circular dated 30th January, 2023 has permitted the Insurers to pay profit related commission to non-executive director(s) including the non-executive director(s) appointed under section 48A of the Insurance Act, 1938, under the deemed approval mechanism, subject to the following conditions:

1. The insurer has reported positive profit after tax for the period for which the said commission is proposed to be paid.
2. The Board of the insurer has passed the resolution approving such payment.
3. The amount of payment of remuneration in the form of profit related commission to each of the Non-Executive Director shall not exceed the limits specified in the Guidelines on Remuneration of Non-Executive Directors and Managing Director /Chief Executive Officer / Whole-time Directors of Insurers, as amended from time to time.
4. Disclosures with regard to said payment shall be made in the financial statements for the respective financial year.
5. The insurer shall comply with all other applicable laws in this regard.