IRDAI Proposes Sweeping Reforms to Actuarial and Investment Regulations: Second Amendment 2026 Explained

Overview and Background

The Insurance Regulatory and Development Authority of India (IRDAI) has released an Exposure Draft for the IRDAI (Actuarial, Finance and Investment Functions of Insurers) (Second Amendment) Regulations, 2026. This proposed regulatory overhaul seeks to bring the existing 2024 framework into alignment with the landmark Sabka Bima Sabki Raksha (Amendment of Insurance Laws) Act, 2025 ("SBSR Act"), which has significantly reshaped the legislative landscape governing insurance operations in India.

The consultation paper, dated 19th June, 2026, was published to invite responses from a wide spectrum of stakeholders — including insurers, reinsurers, promoters, investors, actuarial professionals, legal practitioners, and policyholders — with a comment submission deadline of 10th July, 2026.

At its core, this amendment initiative is driven by a multi-pronged objective: deepening insurance penetration across India, easing the regulatory burden on businesses, expanding availability of long-term capital within the sector, and reinforcing the prudential regulatory architecture that governs insurers and reinsurers operating in the country.

The proposed Second Amendment Regulations derive their authority from an extensive set of provisions under the Insurance Act, 1938, including clauses (f), (g), (gc), (h), (i), (ia), (ib), (y), (z), (za), (zd) and (zab) of sub-section (2) of Section 114A, as well as Sections 11, 12A, 13, 20, 27, 27E, 28, clause (a) of sub-section (3) of Section 29, 49, 64V, 64VA and 119 of the Insurance Act, 1938 (4 of 1938). Additional authority is drawn from Section 14 and Section 26 of the Insurance Regulatory and Development Authority Act, 1999 (41 of 1999). These regulations are being framed in consultation with the Insurance Advisory Committee.

Upon publication in the Official Gazette, the amendments shall come into force immediately.

Terminology Change: "Actuarial Report and Abstract" Replaced Throughout

One of the structurally significant but procedural changes introduced by the proposed amendment is the uniform substitution of the term "Actuarial Report and Abstract" with the term "Actuary Report" across the entirety of the principal IRDAI (Actuarial, Finance and Investment Functions of Insurers) Regulations, 2024. Similarly, in Part III of Schedule I, the word "Abstract" is replaced by "Report" throughout. This harmonisation of terminology reflects the broader statutory changes introduced by the SBSR Act and ensures linguistic consistency across the regulatory framework.

Schedule I: Actuarial Functions — Key Proposed Changes

New Definitions Introduced

The amendment inserts three new definitional sub-clauses into Clause 1 of Part I of Schedule I of the principal regulations:

  • "Appointed Actuary" — refers to an actuary appointed by an insurer (other than a Foreign Re-insurer's Branch) under Section 12A of the Insurance Act, 1938, in accordance with the eligibility criteria prescribed under these regulations.
  • "Certifying Actuary" — refers to an actuary appointed specifically by a Foreign Re-insurer's Branch (FRB) under Section 12A of the Act.
  • "Actuary for Specific Purposes" — refers to an actuary appointed by an insurer for purposes arising under Section 3B, Section 22, or Section 64K under Section 12A of the Act.

These definitional inclusions are necessitated by the expanded scope of Section 12A of the Insurance Act, 1938, as amended by the SBSR Act, which now mandates that eligibility criteria, appointment procedures, and the powers and functions of actuaries be expressly governed by regulation.

Expanded Scope of Actuarial Investigation

The SBSR Act has broadened the applicability of Section 13 of the Insurance Act, 1938, which requires insurers to investigate their financial condition — including valuation of liabilities — and submit a report by an actuary. This obligation, previously applicable to select classes of insurers, has now been extended to all insurers. Similarly, Section 49 of the Act — governing bonus and dividend declaration and debenture servicing based on surplus in the Valuation Balance Sheet — has been extended in its applicability to all insurers.

Appointment of Certifying Actuary for Foreign Reinsurer's Branches (FRBs)

Every FRB registered to carry on reinsurance business in India shall be required to appoint a Certifying Actuary separately for Life reinsurance business and General reinsurance business. The appointment shall be intimated to the Competent Authority within seven days.

Eligibility criteria for Certifying Actuary: