IRDA Compliance for Insurance Company

Insurance Company are governed by the various Authorities like Insurance Act, 1938 or amendment thereof; Companies Act 2013; The Foreign Exchange Management Act, 1999. Also, the various policies shall be incorporated by the Insurance Company for smooth business.

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What is IRDA Compliance for insurance company?

Insurance companies are surrounded by a complicated pattern of economic, social ideas and expectations. Insurance Company pull the resources and invest it. Insurance companies having complicated pattern and having fiduciary duty reporting becomes an importance part of an organisation.

Reporting is nothing but sharing the information with the Authorities. For the good governance of an organisation the Authority levies the reporting requirement.

Insurance Company are governed by the various Authorities like Insurance Act, 1938 or amendment thereof; Companies Act 2013; The Foreign Exchange Management Act, 1999. Also, the various policies shall be incorporated by the Insurance Company for smooth business. The Insurance carries complicated business the requirement of compliances increases. The ultimate goal of reporting is transparency and accountability in the organisation.

Reporting required under the Insurance Act

The Insurance Regulatory and Development Authority of India is a statutory body who regulates the Insurance Company. The Insurance Company need to file monthly reports, Quarterly Report, Annually Reports or event based report to the Authority in a prescribed time.

The reports shall be filed by the Authority offline as well as online during the prescribed time in the manner prescribed by the Authority under the respected rules, regulation or circular as may be.

The Insurance Company shall file monthly reporting like information of information of Business information, Policyholders grievances, claims report etc in the prescribed time. Same above the various quarterly report or annual report shall be filled.

The Insurance Company shall timely intimate the Board about the performance of the Company. The Board shall be intimated about the risk raised how resolved, details of policyholders details, details of claims, management report etc.

The accounts shall be prepared by the Company in the manner prescribed by the authority. The Insurance Company shall maintain the solvency Margin ration at all time.

The Annual return of the company shall be filed with Authority in the four copies within the six months from the end of the financial Year. If Insurer carries business outside India than said six months will extended by the three months. The Annual Return shall be signed by the chairman and two directors and by principal officer.

Returns by insurer who established business outside India

Insurer who have establishment outside India have furnish to the Authority four certified copies in the English language of every balance sheet, account, abstract, report and statement supplied to the public authority along with statement audited by an auditor or by a person duly qualified under the law of the insurer’s country showing the assets held by insurer in India as at the date of any balance-sheet so furnished and separate abstract of the valuation report and separate abstract of the valuation report within the time prescribed above.

Reporting required under the Companies Act

All the Insurance Company in India shall be a public Company registered under the Companies Act, 2013. Since the insurance company are public company, they have to comply the provisions of the Companies Act 2013 for Public Company. The provisions for declaration from directors, filing of the resolutions to the Ministry of Corporate Affairs or any other provisions as and when applicable shall be complied duly. The provisions of appointment of Directors, Auditors, annual filing, issue of shares etc shall be complied. In case of contradiction between the Acts the stringent provisions shall prevail.

The Insurance Company has to file the various board resolution related to appointment or resignation of directors, issue of shares, appointment of auditor etc with ROC.

The Annual return in MGT-7 and AOC-4 shall be filed within the 60 days of the AGM. For an Insurance company filing of balance sheet in XBRL is exempted.

The IRDAI has also issued the Corporate Governance Guidelines for an Insurance Company. Insurance company shall comply with the provisions of the said guidelines. The Company shall constitute the committees as prescribed under the guidelines. Insurance Company has to file the annual report as prescribed under the said guidelines in the time prescribed under the guidelines.

Reporting required under the FEMA

The Insurance Company shall have foreign investment or foreign promoters. Such insurance company shall have to comply with the provisions of the FEMA. The inflow and outflow of the foreign flow shall be duly intimated to the Reserve Bank of India in the form prescribed.

Insurance Company has to file annual return of foreign flow in the manner prescribed and time prescribed to RBI.


There are different penalties and consequences for non-compliance with insurance regulations. For non-compliance with authority- The authority can impose a penalty on the company and civil consequences for the directors to not comply with the laws related to the authority. Non-Compliance with Companies 2013 will attract punishments for the company and the directors of the company. Similarly, Non-Compliance with FEMA Regulations would attract severe penalties, which will be enforced by the RBI and authorized dealer.
The functions of IRDAI are as follows: • Issuing certificate of registration.
• Protecting the interest of policyholders.
• Issuing license to agents.
• Specifying the code of conduct for surveyors and loss assessors.
• Promoting efficiency in the insurance business.
• Undertaking inspection, conducting inquiries on insurance companies.
All over India, 17 ombudsmen address grievances related to insurance.
Yes, an insurance company must follow the above compliances. However, compliance depends on the business requirement of the insurance company. A company that does not have any form of foreign holding or foreign investment would not have to deal with compliances under FEMA.
Yes, there are specific compliances which have to be followed by all insurance companies, including the intermediaries, corporate agencies, marketers, and brokers. A company wanting to start an insurance brokering business would have the compliances related to forming a company. Similarly, a company starting a corporate agency would also have similar compliances associated with forming a company.

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