Corporate governance for insurers: Irdai lists new guidelines

The Insurance Regulatory and Development Authority (Irdai) now requires insurance companies to obtain prior approval for appointing board chairpersons. Current chairpersons may continue until March 31, 2026, or until their tenure ends. The chair should be a non-executive member and not lead any board committees. \r

Irdai's May 22 circular emphasizes the board's role in shaping business direction, risk management, and ethical standards. CEOs are responsible for policyholder interests, and boards must monitor conflicts of interest and ensure fair treatment of policyholders and employees. Insurers should maintain independent control functions and effective group-wide risk control systems. \r

An Investment Committee and a refreshed audit policy every four years are mandated. Compliance is required by June 30, 2024.