IRDAI says insurers to shift to new accounting norms, allows 1-yr forbearance
This story was originally published at 21:54 IST on 30 March 2026
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MUMBAI – The Insurance Regulatory and Development Authority of India has approved a shift to Indian Accounting Standards for insurers while allowing a one-year regulatory forbearance to ease the transition, it said in a release. At its meeting held on Monday, the regulator cleared amendments mandating insurers to prepare and present their financial statements in accordance with accounting standards from Wednesday. The move will apply across all segments, including life, general, standalone health insurers and reinsurers.
In a significant relief for the industry, the IRDAI has provided for a one-year forbearance window for insurers that may face challenges in immediately adopting the new framework. During this period, such companies will be allowed to continue under the existing accounting system, even as they submit the new accounting standard-based financial information to the regulator.
Insurers seeking forbearance must apply by Apr. 30, and submit a board-approved implementation plan detailing milestones, system readiness, actuarial and finance preparedness, and governance structures. Even during the forbearance period, such insurers will be required to submit new accounting framework-based financial information to the regulator on a quarterly basis.
The gazette notification, released separately, also makes it clear that the relief is conditional, and insurers must achieve full compliance with the Indian Accounting Standards within the stipulated timeline set by the authority.
The regulator has also introduced a parallel reporting mechanism for up to two years, requiring insurers to present financial statements under both frameworks. This is aimed at helping firms stabilise systems and processes, while giving stakeholders time to assess the impact of the new standards, IRDAI said.
The adoption of Indian Accounting Standards is expected to bring greater transparency, consistency and comparability in financial reporting, aligning India's insurance sector with globally accepted accounting practices, the regulator said. End
Reported by Kabir Sharma
Edited by Deepshikha Bhardwaj
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