Irdai Chief Vacancy Since March Stalls Key Reforms

Rapid Summary

• The Insurance Regulatory and Progress Authority of India (Irdai) has been without a chairman since March 2023, delaying critical reforms in the insurance sector.
• Key initiatives stalled include:

– Bima Sugam: A digital platform for policy comparison, purchase, and servicing.
– Bima Vistaar: Rural coverage bundling program.
– Bima Vahaak: Women-led distribution model.

• Planned shifts to risk-based capital frameworks, IFRS alignment for accounting standards, and legislation for 100% FDI in insurance remain incomplete.
• State-run insurer listings face internal resistance; regulatory scrutiny on mis-selling practices such as bundled insurance sales has intensified following audits revealing claim rejections and sharp premium hikes.
• Industry experts like Kamesh Goyal emphasize transparency, better loss ratios (60%-65%), reduced costs, and trust-building measures like interest refunds on excess profits.
• Public sector insurers are under pressure due to solvency norm breaches; flat individual policy growth limits gains from rising premiums despite financial inclusion goals not advancing significantly.

Times of India Article