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TMI BlogForeign Exchange Management (Insurance) Regulations, 2000 - Life Insurance Memorandum (LIM)X X X X Extracts X X X X X X X X Extracts X X X X ..... s relating to Life Insurance in India (LIM) since brought out is enclosed. The major changes in procedure as per Memorandum are summarised in the Annexure. 2. Necessary amendments to the Foreign Exchange Management Regulations, 2000 are being issued separately. 3. Authorised Dealers may bring the contents of this circular to the notice of their constituents concerned. 4. The directions contained in this circular have been issued under Section 10(4) and Section 11(1) of the Foreign Exchange Management Act 1999 (42 of 1999). Yours faithfully, Grace Koshie Chief General Manager ANNEXURE [A.P.(DIR Series) Circular No.72 dated January 17, 2003] Major changes effected in the revised LIM Sr.No. Subject Matter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... esident without prior approval of Reserve Bank . 5. Restrictions on issue of rupee policies to foreign nationals The restrictions on issue of rupee policies maturing within 7 years to foreign nationals not permanently resident in India have been withdrawn. 6. Export of Policies The restrictions in regard to export of policies have been withdrawn under revised LIM. 7. Instructions addressing Exchange Control concerns The revised LIM is modified in such a manner whereby only issues of exchange control concern are addressed. Other operational instructions not relating to exchange control have been excluded. [A.P.(DIR Series) Circular No.72 dated January 17, 2003] LIM Memoran ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 00-RB dated May 3, 2000. "Person of Indian Origin" will have the same meaning as defined in FEMA Notification No.5 /RB-2000 dated May 3, 2000. 4. Issue of policies and collection of premia a. Residents i. Policies may be issued in foreign currency to resident persons of Indian nationality or origin who have returned to India after being non-resident provided the premia are paid out of remittances from foreign currency funds held by them abroad or from their Resident Foreign Currency (RFC) account with authorised dealers in India. ii. Policies denominated in foreign currency or rupees may be issued to foreign nationals not permanently resident in India provided the premia are paid out of foreign currency funds or from their ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... due on the policy through normal banking channels. 5. Settlement of claims i. The basic rule for settlement of claims on rupee life insurance policies in favour of claimants resident outside India is that payments in foreign currency will be permitted only in proportion in which the amount of premia paid in foreign currency in relation to the total premia payable. ii. Non-resident beneficiaries of insurance claims/maturity /surrender value settled in foreign currency may be permitted to credit the same to NRE/FCNR account, if they so desire. iii. Resident beneficiaries of insurance claims/maturity/surrender values settled in foreign currency may be permitted to credit the same to RFC accounts, if they so desire. iv. Claims/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s in accordance with the terms and conditions laid down by the respective Board of insurance companies. 8. Foreign Currency accounts Insurers may open, hold and maintain with a bank outside India foreign currency accounts for facilitating transactions and expenses relating/incidental to life insurance business undertaken in foreign countries in accordance with regulations laid down in the Memorandum . Insurers should transfer to India regularly all surplus funds held at foreign centres and endeavour to keep in their foreign currency accounts only minimum balances required for normal business. 9. Investments abroad Renewal of existing investments, reinvestment of redemption proceeds of existing investments and fresh investments ..... X X X X Extracts X X X X X X X X Extracts X X X X
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