Section 9. After section 32A, insert the following:

"32B. Insurance business in rural or social sector 19. After section 32A, insert the following: — "32B. Insurance business in rural or social sector .— Every insurer shall, after the commencement of the Insurance Regulatory and Development Authority Act, 1999, undertake such percentages of life insurance business and general insurance business in the rural or social sector, as may be specified, in the Official Gazette by the Authority, in this behalf. "42D. Issue of licence to intermediary or insurance intermediary 29. After section 42C, insert the following: — "42D. Issue of licence to intermediary or insurance intermediary .— (1) The Authority or an officer authorised by it in this behalf shall, in the manner determined by the regulations made by the Authority and on payment of the fees determined by the regulations made by the Authority, issue to any person making an application in the manner determined by the regulations, and not suffering from any of the disqualifications herein mentioned, a licence to act as an intermediary or an insurance intermediary under this Act: — Provided that, (a) in the case of an individual, he does not suffer from any of the disqualifications mentioned in sub-section (4) of section 42, or (b) in the case of a company or firm, any of its directors or partners does not suffer from any of the said disqualifications. (2) A licence issued under this section shall entitle the holder thereof to act as an intermediary or insurance intermediary. "42D. Issue of licence to intermediary or insurance intermediary (3) A licence issued under this section shall remain in force for a period of three years only from the date of issue, but shall, if the applicant, being an individual does not, or being a company or firm any of its directors or partners does not suffer from any of the disqualifications mentioned in clauses (b), (c), (d), (e) and (f) of sub-section (4) of section 42 and the application for renewal of licence reaches the issuing authority at least thirty days before the date on which the licence ceases to remain in force, be renewed for a period of three years at any one time on payment of the fee, determined by the regulations made by the Authority and additional fee for an amount determined by the regulations, not exceeding one hundred rupees by way of penalty, if the application for renewal of the licence does not reach the issuing authority at least thirty days before the date on which the licence ceases to remain in force. (4) No application for the renewal of a licence under this section shall be entertained if the application does not reach the issuing authority before the licence ceases to remain in force: Provided that the Authority may, if satisfied that undue hardship would be caused otherwise, accept any application in contravention of this sub-section on payment by the applicant of a penalty of seven hundred and fifty rupees. - (5) The disqualifications above referred to shall be the following: — "42D. Issue of licence to intermediary or insurance intermediary (a) that the person is a minor; (b) that he is found to be of unsound mind by a court of competent jurisdiction; (c) that he has been found guilty of criminal misappropriation or criminal breach of trust or cheating or forgery or an abetment of or attempt to commit any such offence by a court of competent jurisdiction: Provided that, where at least five years have elapsed since the completion of the sentence imposed on any person in respect of any such offence, the Authority shall ordinarily declare in respect of such person that his conviction shall cease to operate as a disqualification under this clause; (d) that in the course of any judicial proceeding relating to any policy of insurance of the winding up of an insurance company or in the course of an investigation of the affairs of an insurer it has been found that he has been guilty of or has knowingly participated in or connived at any fraud dishonestly or misrepresentation against an insurer or an insured; (e) that he does not possess the requisite qualifications and practical training for a period not exceeding twelve months, as may be specified by the regulations made by the Authority in this behalf; (f) that he has not passed such examinations as may be specified by the regulations made by the Authority in this behalf; (g) that he violates the code of conduct as may be specified by the regulations made by the Authority. "42D. Issue of licence to intermediary or insurance intermediary (6) If it be found that an intermediary or an insurance intermediary suffers from any of the foregoing disqualifications, without prejudice to any other penalty to which he may be liable, the Authority shall, and if the intermediary or an insurance intermediary has knowingly contravened any provision of this Act may cancel the licence issued to the intermediary or insurance intermediary under this section. (7) The Authority may issue a duplicate licence to replace a licence lost, destroyed or mutilated, on payment of such fee, as may be determined by the regulations made by the Authority. (8) Any person who acts as an intermediary or an insurance intermediary without holding a licence issued under this section to act as such, shall be punishable with fine, and any insurer or any person who appoints as an intermediary or an insurance intermediary or any person not licensed to act as such or transacts any insurance business in India through any such person, shall be punishable with fine. (9) Where the person contravening sub-section (8) is a company or a firm, then, without prejudice to any other proceedings which may be taken against the company or firm, every director, manager, secretary or other officer of the company, and every partner of the firm who is knowingly a party to such contravention shall be punishable with fine.". "6. Requirement as to capital (i) for "once at least in every three years", substitute "every year"; (ii) in the first proviso, for "not later than four years", substitute "not later than two years"; (iii) after the second proviso, insert the following: — "Provided also that for an insurer carrying on life insurance business in India immediately before the commencement of the Insurance Regulatory and Development Authority Act, 1999, the last date as at which the first investigation after such commencement should be caused by an actuary, shall be the 31st day of March, 2001:"; (iv) after the third proviso, insert the following: — "Provided also that every insurer, on or after the commencement of the Insurance Regulatory and Development Authority Act, 1999, shall cause an abstract of the report of the actuary to be made in the manner specified by the regulations made by the Authority."; (b) in sub-section (4), after the proviso, insert the following: — "Provided further that the statement referred to in sub-section (4) shall be appended in the form and in the manner specified by the regulations made by the Authority.". — 15. After section 27B, insert the following: "27C. Prohibition for investment of funds outside India .— No insurer shall directly or indirectly invest outside India the funds of the policy-holders.