The Insurance Development and Regulatory Authority (IDRA) plans to bring major reforms in the country's insurance industry, including a crackdown on data manipulation as part of its broader plan to protect policyholder interests, reported the Financial Express.
Addressing the media, IDRA Chairperson Mir Nadia Nivin, said that the regulatory body’s reform agenda included forensic technical audits of insurers' information systems. Alleging concealment of data by insurers, through the use of multiple or double servers to generate separate sets of financial information, she said that such practices would result in serious flaws in regulatory reporting. The regulator has given insurers six weeks to remove the hidden servers, after which technical and forensic audits are expected to begin, alongside legal measures where violations are found.
The IDRA will introduce risk-based supervision in the industry by December 2026, which will be a significant shift from conventional compliance-based supervision. Such a system works on reliable data and so any manipulation of information will result in failure to identify emerging problems. The regulator plans to introduce a sector-wide unique policy ID and unique cover ID system within three to four months to improve policy tracking, monitor premium inflows and prevent fraud.
IDRA has indicated that it is moving toward a controlled mechanism for settling claims involving troubled insurers, with a first-in, first-out approach intended to ensure that claimants are treated according to an established order rather than discretionary decisions.