IRDAI caps management expenses for General & Health Insurance Businesses in India
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- Last Updated on 31 March, 2023
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Notification F. No. IRDAI/Reg/4/192/2023, Dated 26.03.2023
The IRDAI has notified the IRDAI (Expenses of Management of Insurers transacting General or Health Insurance business) Regulations, 2023 to provide flexibility to insurers in managing their expenses within overall limits. As per the new norms, no insurer carrying on General Insurance Business in India shall incur expenses of management exceeding 30% of gross premium written in India in a financial year and for Health Insurance Business, it shall not exceed 35% of gross premium.
Further, in addition to expenses of management limit as specified, insurers shall be allowed the following additional expenses:
(a) Head Office Expenses.
(b) Expenses incurred towards the rural sector, Pradhan Mantri Suraksha Bima Yojana (PMSBY), Pradhan Mantri Jan Arogya Yojana (PMJAY) and Pradhan Mantri Fasal Bima Yojana (PMFBY) business.
(c) Expenses incurred towards ‘Insurtech’ and ‘Insurance Awareness’.
Also, all insurers transacting General Insurance or Health Insurance business, at the end of each financial year, must prepare a Return of Expenses of Management as per the specified format. The Return must be signed by the Chief Executive Officer, the Chief Financial Officer, the Chief Compliance Officer and the Appointed Actuary of the Insurer. Various other conditions and compliances were also prescribed.
Click Here To Read The Full Notification
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