Section 4 in International Financial Services Centres Authority (Manner of Payment and Receipt of Premium) Regulations, 2022
4. The premium to be paid by a person proposing to take an insurance policy (hereinafter referred to as the proposer’) or by a policyholder to an I[O may be made through any of the following manner(s), namely: -
(1)recognised instrument of payment using banking channels including payment made through electronic mode;(2)bank guarantee or equivalent instrument issued by any bank in favour of the IO for payment of premium, in case the insured fails to make such payment;(3)cash deposit; or(4)— any other method or manner of payment as may be specified by the Authority.Assumption of risk with or without receipt of premium in advance -For the purposes of these regulations, an ITO may assume the risk, continue to assume the risk or terminate any assumption of risk, subject to satisfaction of the following -(a)the premium payable is received by it;(b)the premium payable is guaranteed in terms of sub-regulation (2) of regulations 4 of these regulations;(c)the deposit of such amount, as the Authority may specify, is made in advance for adjustment towards premium; or(d)the premium payable to it is in accordance with the terms and conditions of the contract of insurance entered into in this behalf or in such manner as may be specified by the Authority from time to time.An IIO and prospect or insured, as the case may be, may mutually agree for payment of premium in instalments, time schedule and manner of payment of such instalments by incorporating a premium payment warranty clause in the contract of insurance.The contract of insurance shall, inter-alia, specify the following:(1)the manner and time schedule of payment of premium in full or in instalments;(2)grace period, if any and consequence of non-payment of premium within such grace period;(3)conditions for the revival of lapsed policy, if any;(4)date of commencement of risk ;(5)— date of termination of risk upon non-payment or non-realization of premium taking into account the line of business, duration of the insurance policy;(6)Premium Payment Warranty clause, if any, as agreed upon by the IO and the Insured; and(7)— any other information as may be specified by the Authority from time to time.Payment of Premium for contracts of Reinsurance —(8)the risk may be assumed without payment of premium in advance on insurances accepted under automatic reinsurance contracts;(2)In the case of facultative reinsurance, risk may be assumed without payment of premium in advance in accordance with the terms of the Premium Payment Warranty clause, if incorporated in the contract of insurance;(3)Reinsurers shall have systems in place to ensure that all premiums receivable are duly received and accounted for.
