CORPORATE LAW UPDATE
1st December 2023
Issue No. 15/23-24
THE INSURANCE REGULATORY AND DEVELOPMENT AUTHORITY OF INDIA CREATES A TASK FORCE TO EXAMINE IMPLICATIONS OF THE DPDP ACT, 2023.
The Insurance Regulatory and Development Authority of India (“IRDAI”) on 24 November 2023 set up a task force as a proactive step to examine the implications of the Digital Personal Data Protection Act, 2023 (“DPDP Act”) on the insurance sector in India.
BACKGROUND
The Ministry of Law and Justice, Legislative Department vide Gazette Notification No.CG-DL-E-12082023-248045 on 11 August 2023 had notified the DPDP Act which aims to provide for a comprehensive framework for the processing of digital, digitized personal data in a manner that recognizes both, the right of individuals to protect their personal data and at the same time the need to process such personal data for lawful purposes for commercial purposes.
CURRENT STANCE
The IRDAI has therefore established a task force comprising of industry stakeholders, legal experts and representatives from LIC, GIC, ICICI Lombard, Aditya Birla Insurance etc. for the purpose of submitting a comprehensive report within one month of the issuance of this order. The report is to cover an overall impact that the provisions of the DPDP Act may have on the way the insurance sector runs. The report may cover challenges the industry may run into, suggest compliance framework that can be adopted, and put forth recommendations to align the industry with the new data protection framework.
The Union Minister of State for Skill Development & Entrepreneurship and Electronics & IT, Shri Rajeev Chandrasekhar, recently participated in the first Digital India Dialogue discussions on the DPDP Act in New Delhi on 20 September 2023, wherein, he talked about rules to be prescribed within a months’ time. He further stated that companies that already follow similar rules like that of the GDPR (EU’s General Data Protection Regulation) shouldn’t ask for a very long time to follow these new rules.
Bearing in mind the volume of personal data collected stored and processed by the industry, this measure emphasizes the prompt approach adopted by the IRDAI to address the impact of the DPDP Act on the insurance domain.
The order can be accessed here.
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