Introduction: The Insurance Regulatory and Development Authority of India (IRDAI) has issued a crucial circular dated 5th January 2024, concerning the submission of Advance Reinsurance Programs. This directive, outlined in the IRDAI (Re-Insurance) Regulations, 2018, impacts all insurers and exempted insurers. This article delves into the key aspects of the circular, providing insights into the regulatory framework and the obligations it imposes on insurers.
Detailed Analysis:
1. Regulatory Framework (IRDAI (Re-Insurance) Regulations, 2018): The IRDAI (Re-Insurance) Regulations, 2018, form the foundation of the circular. These regulations meticulously address the operational facets of reinsurance placement. Regulation 3(A) specifically mandates that every insurer submits an advance reinsurance program to the Authority, following a specified summary format, at least 45 days before the commencement of the financial year.
2. Submission Formats (Annexure A and B): The circular provides clarity on the submission formats for General Insurers and Life Insurers/FRBs, respectively. Annexure A is dedicated to General Insurers, including standalone Health Insurers, Reinsurers, FRBs, and Exempted Insurers. Annexure B is tailored for Life Insurers and FRBs. Insurers must adhere to these formats while submitting their summary advance reinsurance programs.
3. Guidelines for Information Submission (Annexure C): Insurers are advised to meticulously follow the guidelines outlined in Annexure C when submitting information in the specified format. This ensures a standardized approach and compliance with regulatory requirements.
4. Timely Submission Obligations: The circular emphasizes the importance of timely submission. The Board of every insurer must ensure that the advance reinsurance program reaches the Authority within the stipulated timeframe mentioned in the regulations. In the case of Exempted insurers without a Board/CEO/CFO, the responsibility falls on the Authorized Person(s) to ensure timely submission.
Certification Requirement (Annexure D): To validate the accuracy of the information in the summary Reinsurance program, insurers are required to submit a certificate duly signed by the CEO and CFO. Annexure D provides the format for this certification, underscoring the significance of accountability at the leadership level.
Conclusion: In conclusion, the IRDAI circular serves as a pivotal guideline for insurers, detailing the procedural nuances of submitting Advance Reinsurance Programs. Adherence to the specified formats, guidelines, and timely submission is paramount. Insurers are urged to comprehend the circular thoroughly, ensuring compliance with the regulatory framework. The certification requirement further emphasizes the need for accuracy and responsibility in this critical aspect of the insurance industry.
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INSURANCE REGULATORY AND
DEVELOPMENT AUTHORITY OF INDIA
Circular Ref: IRDA/REIN/CIR/RISF/4/1/2024 Dated: 5th January, 2024
To,
The CMDs/CEOs of All Insurers and Exempted Insurers
Sub: Submission of Advance Reinsurance Programme
1. The Authority has issued the IRDAI (Re-Insurance) Regulations, 2018 which deal with the operational aspects of placement of reinsurance. As per the Regulation 3(A) of the above Regulations an advance reinsurance programme shall be submitted by every insurer in a specified summary format, to the Authority, at least 45 days before the commencement of the financial year.
2. The formats for submission of summary advance reinsurance programme by insurers are attached as Annexure A for General Insurers (including standalone Health Insurers, Reinsurers, FRBs and Exempted Insurers) and Annexure B for Life Insurers and FRBs respectively.
3. Insurers are advised to follow the guidelines outlined in Annexure C while submitting information in the specified format.
4. The Board of every insurer shall ensure that the advance reinsurance programme is submitted to the Authority in the specified format within the stipulated timeframe as mentioned in the Regulations.
In case of Exempted insurers, if there is no Board/CEO/CFO, then the Authorized Person(s) shall ensure the submission of advance reinsurance programme in the specified summary formats.
5. Insurers shall submit a certificate confirming the information in the summary Reinsurance programme duly signed by CEO and CFO as per the attached Annexure D.
(Shardul Admane)
General Manager
