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In line with the practice adopted by other countries, the Insurance Regulatory and Development Authority of India (Irdai) is working on a proposal to move towards a risk-based capital framework to ensure optimum utilisation of capital.

Irdai chairman Debasish Panda also noted that the regulator is also trying to move away from the traditional supervision-based framework to a risk-based supervision framework which will be enabled by technology. He further noted that so, these two major programmes are already launched within the Irdai in consultation with industry and other stakeholders.

The chairman said 'I hope the risk-based supervisory framework, we should be able to do this within 6-9 months. And the risk-based capital regime will take maybe around 2-3 years. And that is the estimate that the international experts also (express)...but we are fast-tracking that as well.’