Faced with a continuing shortage of actuaries, the Insurance Regulatory and Development Authority of India (IRDAI) has eased norms for empanelled actuaries, allowing them to undertake valuation of more than one insurer every quarter.
The move comes as insurers were facing difficulty in getting actuaries for the mandated valuation of their liabilities in every quarter of the financial year.
Life, general insurers
Actuaries for life and general insurers will continue to remain separate. However, the IRDAI has allowed each actuary for general insurers to work with as many as three firms in each quarter. This can include one standalone health insurer, one general insurer and one general insurance business of a reinsurer.
Similarly, actuaries undertaking valuations of life insurers are now allowed to work with one life insurer and one life insurance business of a reinsurer in each quarter.
“This has been done to enhance the availability of actuaries from the panel and ease the process of utilising the services of such actuaries,” said the IRDAI in a circular, adding that it had received requests from many insurers on the issue.
Under the original guidelines issued in February 2017, the insurance regulator had said that each panel actuary would not be involved in the annual statutory valuation of more than one insurer during any financial year.
The IRDAI had selected the panel last year to help insurance companies use their services in case they could not appoint their own actuary.
The panel actuary is expected to vet products and estimate reserves and solvency margins of insurers every quarter and at the end of every financial year. Additionally, the actuary could also investigate the finances of an insurer or look into their valuation on the direction of the regulator.
At present, there is a panel of eight actuaries for the general insurance sector, and four for life insurance players.
Insurers and actuaries welcomed the IRDAI’s latest relaxation and said it would benefit the industry.
“There is a big shortage of actuaries in the non-life sector and this will prove to be useful,” said an executive with an insurance company.
“The idea behind appointing panel actuary by IRDAI was to fill in the shortage as there are not too many actuaries. This will definitely ease the pressure,” said Nasrat Kamal, Director and Actuary, Numerica Group.
Source: The Hindu BusinessLine