MyInsuranceClub
menu

Insurance regulator forms a panel to relook insurance regulations

Insurance Regulatory and Development Authority of India (IRDAI) has formed a panel to relook the existing regulations pertaining to the life and non-life insurance industry.

eye icon
63 views/
clock icon
2 mins 21 secs
calendar icon
Last Updated - May 16, 2023
article image
Listen to this article
audio icon

Insurance Regulatory and Development Authority of India (IRDAI) has formed a panel to relook the existing regulations pertaining to the life and non-life insurance industry. The panel will go through several key aspects of both the industries such as actuarial report, solvency margin regulations and reinsurance regulations of life insurance business. The panel will also relook actuary regulations and issues related to claims process for the general insurance industry.

Agenda for General Insurance:-

Review of IBNR Guidelines (incurred but not reported)
Review of FCR (Financial Condition Report)
Appointed Actuary Regulations for General Insurance
Issues related to claim reserving and suggesting the possible approaches
Actuarial involvement in matters related to Reinsurance

Agenda for Life Insurance:-

IRDA (Assets, Liabilities and Solvency Margin) Regulations, 2000
IRDA (Actuarial Report and Abstract) Regulations, 2013
IRDA (Life Insurance-Reinsurance), Regulations, 2013
Appointed Actuary Regulations for Life Insurance
Appointed Actuary’s Annual Report

The committee is required to work upon the above agenda and submit the report within one month from the date of publication of the above.

Further, the regulator is looking to rework on commissions paid to the distributors, agents, etc. that take a big chunk out of initial premiums, mostly without the customer’s knowledge. Such commissions can at times be as much as 25-30% of the first payments on policies.

In the revised guidelines, IRDAI might restrict the expenses that an insurance company can charge on premiums and the commissions paid, which have been weighing down returns for policyholders. This move by the regulator will help reduce mis-selling of policies. This will bring in transparency and discourage forced selling of insurance products.

author image
Author