Irdai raises concerns over tweaks to show solvency ratio

Mumbai: The Insurance Regulatory and Development Authority of India (Irdai) has expressed concerns about a few life insurers allegedly tweaking actuarial assumptions to keep solvency ratios above the 150% regulatory minimum, people familiar with the matter said. The regulator issued a stern warning to CEOs and appointed actuaries earlier where they raised concerns over undue pressure from company managements to revise assumptions to present stronger capital positions.

The regulator is pushing for tighter oversight during risk-based inspections, which began late 2024 with one insurer as part of the quantitative impact study, and is now rolling out across the industry to assess the impact of risk-based framework's impact on solvency. These inspections assess whether assumptions align with historical experience.