The Tariff Advisory Committee (TAC) is a statutory autonomous body in India under the Insurance Act, 1938. It formulates and administers tariff for major classes of General Insurance business such as Fire and Allied perils, Petrochemicals, Marine Hull, Engineering and Motor etc. TAC also regulates terms and conditions that are offered by the insurers. The TAC is a body of experts headed by the Chairman of the (IRDA) GIC as an ex-officio Chairman, and representatives from insurance companies, Ministry of Finance and Bureau of Industrial Costs and Prices (BICP), Government of India.
Further, technical groups consisting of representatives of insurers as well as of the TAC have been constituted for various classes of insurance. These groups assist the TAC in making changes in ratings from time to time, in relation to loss experience. The TAC, while evaluating and rating a risk takes into consideration, the past loss record and physical features of the risk such as safe distances between blocks, provision for Fire fighting appliances, and good house-keeping.
Further, the TAC also specifies special ratings and discounts to extend the benefits of lower premiums to the insured. The TAC at regular intervals interacts with the insured’s interest groups, Surveyors, Associations, Trade bodies, and other forums. It also advises on upgrading safety standards, and makes publications of Fire Protection Systems and Building regulations etc.
History of TAC in the pre and post De-tariffed era Before understanding the role of TAC in the detariffed regime, a brief peep into the past history of TAC will throw light on the objectives behind the setting up of this committee, the reasons leading to the government to detariff and the role assumed by this committee at present in the detariffed regime.