IRDAI (Actuarial, Finance and Investment Functions of Insurers) Regulations, 2024

On 22-3-2-2024, the Insurance Regulatory and Development Authority of India (‘IRDAI’) notified the Insurance Regulatory and Development Authority of India (Actuarial, Finance and Investment Functions of Insurers) Regulations, 2024 applicable to all insurers including those engaged exclusively in reinsurance business to promote ease of doing business. The provisions will come into force on 1-4-2024.

Key Points:

1. The regulations will be reviewed once in every 3 years from the date of its publication i.e. 22-3-2024.

2. Objective:

   • To ensure sound and responsive management practices are in place for effective discharge of functions and analysis.

   • Regulatory returns are prepared and reported in accordance with applicable standards, principles and policies to provide a true and fair view of the state of affairs of the insurer.

   • Interests of policyholders are protected.

   • Ease of doing business is facilitated.

3. The following Principles will govern the Actuarial, Finance and Investment functions of insurer:

   • Mathematical Reserves or Technical liabilities;

   • Solvency margin of insurer is always ensured at least at the control level;

   • Financial statements reflect true and fair picture of the financial condition of the insurer;

   • Funds are invested such that the policyholders’ liabilities are met as and when due;

   • Suitable and adequate resources are available with insurer to carry out actuarial, finance and investment functions.

4. The following Regulations will stand repealed from 1-4-2024:

   • Insurance Regulatory and Development Authority of India (Actuarial Report and Abstract for Life Insurance Business) Regulations, 2016;

   • Insurance Regulatory and Development Authority (Distributions of Surplus) Regulations, 2002;

   • Insurance Regulatory and Development Authority of India (Assets, Liabilities and Solvency Margin of Life Insurance Business) Regulations, 2016;

   • Insurance Regulatory and Development Authority of India (Assets, Liabilities and Solvency Margin of General Insurance Business) Regulations, 2016;

   • Insurance Regulatory and Development Authority of India (Appointed Actuary) Regulations, 2022;

   • Insurance Regulatory and Development Authority of India (Investment) Regulations, 2016;

   • Insurance Regulatory and Development Authority of India (Preparation of Financial Statements and Auditors’ Report of Insurance Companies) Regulations, 2002

   • Insurance Regulatory and Development Authority of India (Inspection and Fee for Supply of Copies of Returns) Regulations, 2015;

   • Insurance Regulatory and Development Authority of India (Loans or Temporary Advances to Full Time Employees of the Insurers) Regulations, 2016.

5. Insurers will have to adhere to the provisions set out in the following Schedule:

   • Schedule I– relating to Actuarial functions

   • Schedule II– relating to Finance functions

   • Schedule III– relating to Investment functions

   • Schedule IV– relating to Loans and Advances by Insurance Companies

   • Schedule V– relating to Inspection and Supply of Returns.