IRDAI mandates independent validation of insurers’ preparedness for implementing Ind AS

The Insurance Regulatory and Development Authority of India (IRDAI) has ordered an independent assessment of how ready insurers are to adopt Indian Accounting Standards (Ind AS), calling for an external evaluation of governance, systems and transition procedures in the first adoption year.

In a circular that offers further details and clarifications regarding the IRDAI (Actuarial, Finance and Investment Functions of Insurers) Regulations, 2024, the regulator stated that each insurer must secure an independent validation of its Ind AS rollout.

The rule will take effect in FY2026‑27 for insurers that begin using Ind AS that year, and in FY2027‑28 for those who have received regulatory forbearance.

The independent validation will examine whether insurers have built a solid implementation framework, covering a board‑approved strategy and roadmap, governance and accountability structures, sufficient actuarial, finance, risk and IT personnel, data‑management practices, transition plans under Ind AS 101 and Ind AS 117, and technology preparedness, according to the IRDAI.

The validation ought to be performed continuously during the first implementation year, with the independent validator brought on board from the first quarter to enable prompt review and corrective action.

The independent validation report must be provided to the insurer’s board each quarter, prior to finishing the audit or limited review of the Ind AS financial statements. Moreover, an annual report is to be lodged with the regulator before the audited Ind AS financial statements are released, as stated in the circular.

Published on July 14, 2026