The Insurance Regulatory and Development Authority of India (IRDAI), through a notification dated 15 June 2026, has amended Paragraph 2 of its earlier Notification F. No. IRDAI/RI/3/217/2026 dated 9 April 2026 relating to Obligatory Cession for the financial year 2026–27. Exercising powers under Section 101A(2) and (4) of the Insurance Act, 1938, after consultation with the Advisory Committee constituted under Section 101B and with the previous approval of the Central Government, the Authority has revised the percentage of obligatory cession. Under the amended provision, 4% of the sum insured on each general insurance policy issued during the period from 1 April 2026 to 31 March 2027 must be reinsured with the Indian reinsurer. However, premium ceded to the Terrorism Pool, Nuclear Pool, and Bharat Maritime Insurance Pool will attract a nil obligatory cession. The notification further clarifies that the entire obligatory cession must be placed exclusively with the General Insurance Corporation of India (GIC Re).
INSURANCE REGULATORY AND DEVELOPMENT AUTHORITY OF INDIA
NOTIFICATION
Hyderabad, the 15th June, 2026
F. No. IRDAI/RI/5/219/2026.—In exercise of the powers conferred by Sub-section (2) and (4) of the Section 101A of the Insurance Act, 1938, the Authority, after consultation with the Advisory Committee, constituted under section 101B of the Insurance Act, 1938 and with the previous approval of the Central Government, hereby makes the following amendment to the para No.2 of Notification F. No. IRDAI/RI/3/217/2026 dated 9th April, 2026 issued on “Obligatory Cession for the fmancial year 2026-27”.
For the existing Para No.2, the following shall be substituted, namely:
Percentage of Cession: The percentage cession of the sum insured on each General Insurance Policy to be reinsured with the Indian Re-insurer(s) shall be 4% (four percent) in respect of insurance attaching during the financial year beginning from 1st April, 2026 to 31st March, 2027, except the premium ceded to Terrorism pool, Nuclear pool and Bharat Maritime Insurance Pool wherein it would be made ‘NIL’.
The entire Obligatory Cession is to be placed with General Insurance Corporation of India (GIC Re) only.
J. MEENA KUMARI, Executive Director
[ADVT.-III/4/Exty./175/2026-27]
