IRDAI issues Direction for reconciliation of Co-Insurers Balance from ETASS

May 24, 2019 | by Avantis RegTech Legal Research Team


The Insurance Regulatory Development Authority of India (IRDAI) on May 20, 2019, has issued direction regarding reconciliation of Co-Insurers balance from Electronic Transaction Administration and Settlement System (ETASS). The Authority had noticed that the inter-company balances in re-insurance and co-insurance business are significantly high and are on the rise and both the transactions typically involve multiple organizations across various geographies giving rise to various issues.

In this regard, it is hereby directed that:

1.For all the co-insurance transactions that took place after April 01, 2018, the balances due to/from co-insurers shall be reconciled with the balances as per ETASS;

2.A certificate from the statutory auditor shall be submitted to the Authority, in the format as prescribed in Annexure A, along with the annual financial statements certifying that there is no difference in books of accounts and ETASS with regard to co-insurance transactions that relate to policies with a risk start date on or after April 01, 2018;

3.In case of differences, the co-insurer wise differences shall be reported in the Auditor’s certificate;

4.Balances for the transactions that took place before April 01, 2018 shall be reconciled by the insurer and the same shall be submitted to the Authority on or before September 30, 2019, without fail.

[Circular No. IRDA/F&A/CIR/MISC/080/05/2019]

Click here to download the Circular.

 


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