We are pleased to present the October-November 2026 edition of our Insurance Law Newsletter, covering key developments in India’s insurance regulatory landscape, along with noteworthy developments from Europe and the derivatives markets. Product and market structure take centre stage this edition, with the Insurance Regulatory and Development Authority of India (“IRDAI”) operationalising the Supreme Court’s directions on a four-layer motor insurance policy and consolidating the procedural framework for registration, capital structure, share transfers and amalgamation of insurers, alongside the migration of health filings to its integrated reporting platform, an extended consultation window on distribution reforms and an industry-wide drive to clear long-pending policyholder grievances. On the disputes front, the National Consumer Disputes Redressal Commission (“NCDRC”) has reaffirmed that statutory premium deadlines cannot be extended by private arrangement, while the Gujarat High Court has placed the evidentiary burden squarely on insurers alleging forged motor policies. We also examine IRDAI’s rejection of a broker registration application for incomplete promoter disclosures. In Beyond India, we examine European supervisory expectations for private equity-backed insurers and a proposed outcomes-focused approach to the sale of insurance-based investment products, as well as recent developments from the International Swaps and Derivatives Association (“ISDA”) relating to the recalibrated standard initial margin model, tokenized collateral. So, sit back, enjoy your favourite beverage, and explore the latest developments shaping the insurance and derivatives legal landscape.
The law develops
IRDAI Issues Exposure Draft on Subsidiary Instructions and Consultative Committees Regulations, 2026
IRDAI, vide exposure draft dated November 3, 2026, proposed the IRDAI (Subsidiary Instructions and Consultative Committees) Regulations, 2026, pursuant to the framework introduced under the Sabka Bima Sabki Raksha (Amendment of Insurance Laws) Act, 2025. The proposed Regulations seek to establish a structured framework for the issuance, amendment, periodic review and withdrawal of subsidiary instructions under Section 114B of the Insurance Act, 1938, including instructions clarifying regulatory ambiguities and prescribing ancillary procedural requirements. They also provide for the constitution, composition and functioning of Consultative Committees under Sections 114B and 114C, covering areas such as policyholder protection, sectoral development, market conduct, financial stability, insurance distribution and reinsurance. The framework further recognises the issuance of urgent subsidiary instructions where prior consultation is impracticable, subject to recording reasons for such action. IRDAI has invited stakeholder comments on the exposure draft in the prescribed format on or before November 23, 2026, to the designated officials at the email addresses specified in the draft.
Read: IRDAI Proposes New Regulatory Framework for Subsidiary Instructions and Consultative Committees
IRDAI Issues Master Circular on Registration, Capital Structure, Transfer of Shares and Amalgamation of Insurers
IRDAI, vide master circular dated November 2, 2026, has issued the Master Circular on Registration, Capital Structure, Transfer of Shares and Amalgamation of Insurers, 2026, prescribing forms and clarifying provisions of the IRDAI (Registration, Capital Structure, Transfer of Shares and Amalgamation of Insurers) Regulations, 2024, as amended by the amendment regulations notified on July 30, 2026. The circular introduces Form IRDAI/NOC for applications for no-objection certificates for registration of new insurers, Form IRDAI/R4 for duplicate registration certificates and Form IRDAI/ToS for share transfer approvals, and specifies the documents required for Form IRDAI/R1. It further clarifies that share transfer approval requirements apply to the exercise of employee stock options, including shares issued through employee trusts, and to listed insurers. For proposed IPOs, insurers are required to furnish details of the offer, pre and post listing shareholding pattern and relevant Board approvals, along with a declaration from the MD/CEO. The circular also prescribes detailed documentation and reporting requirements for amalgamation or transfer of insurance business, including submission of specified post-implementation documents by the transferee insurer within 30 days. Further, insurers issuing Other Forms of Capital must report the relevant details to IRDAI within 15 days of allotment. Notably, the processing fee for approval of share transfers has been reduced from ₹50 lakh to ₹10 lakh, although fees already paid are non-refundable. The circular takes immediate effect and applies to all insurers (except Foreign Reinsurer Branches) and applicants seeking registration. It also repeals the IRDAI (Registration, Capital Structure, Transfer of Shares and Amalgamation of Insurers) Regulations, 2024 dated May 15, 2024 and the circular on subscribers to Other Forms of Capital dated September 6, 2024.
IRDAI Mandates Four-Layer Motor Insurance Policy Structure for Private Vehicles
IRDAI, vide circular dated November 2, 2026, has directed all general insurers (other than standalone health insurers and specialised insurers) to implement a four-layer motor insurance policy structure for private cars and two-wheelers, with effect from December 15, 2026. The circular implements the Hon’ble Supreme Court’s directions in National Insurance Company Ltd. v. Smt. Thungala Dhana Laxmi & Ors. (Civil Appeal No. 14369/2025), providing for (i) third-party liability (mandatory); (ii) legal liability to occupants or pillion riders, (optional); (iii) personal accident cover, comprising mandatory cover for the owner-insured and optional cover for occupants, pillion riders and drivers other than the owned-driver; and (iv) own-damage cover (optional). Insurers must adopt uniform policy wordings for the optional covers, to be formulated by IRDAI in consultation with the General Insurance Council, obtain a duly completed customer option form, issue a Customer Information Sheet at the point of sale, and separately disclose the coverage and premium for each layer in the policy schedule. Existing third-party policyholders may opt for occupant liability cover during the policy period upon payment of additional premium, from the insurer that issued their third-party policy, without cancelling their existing policy. Insurers retain flexibility in pricing own-damage cover and must complete integration with Bima Sugam by December 15, 2026, ensuring availability of the policies on the platform from that date.
Read: IRDAI Circular on Four-Layer Structure of Motor Insurance Policy
State of play
Health returns and product UIN generation move to integrated BAP
IRDAI, vide circular dated October 30, 2026, has migrated the submission of health regulatory returns and the generation of Unique Identification Numbers (“UINs”) for health insurance products to a dedicated Health module on its upgraded Business Analytics Platform (“BAP”). Insurers are required to submit returns for FY 2024-25 and FY 2025-26, RET 197 for Q1 and Q2 of FY 2026-27 (excluding life insurers), and all subsequent returns through BAP. Further, with effect from November 2, 2026, generation of UINs for new health insurance products and modifications to existing products, as well as submission of updates relating to product withdrawals, must be undertaken exclusively through the BAP Health Product Module. Consequently, the Health Department’s email communication dated June 10, 2024, regarding UIN generation ceases to apply. The circular applies to all insurers except reinsurers, Foreign Reinsurer Branches, Agriculture Insurance Company of India and Export Credit Guarantee Corporation of India Limited.
Read: IRDAI Circular on Migration of Health Returns and UIN Generation to BAP
November 2026 declared Grievance Resolution Month
IRDAI, vide press release dated October 29, 2026, announced November 2026 as “Grievance Resolution Month” across the insurance industry to accelerate the resolution of pending policyholder grievances, particularly long-pending cases. As on March 31, 2026, approximately 2.21 lakh cases were pending before Consumer Commissions and judicial courts, of which around 72.49% had remained pending for over a year, in addition to approximately 11 lakh cases before Motor Accidents Claims Tribunals. Insurers have been advised to prioritise long-pending matters, review litigation on merits and pursue amicable settlements where legally and factually sustainable, ensure prompt compliance with Insurance Ombudsman Awards, strengthen litigation management and address recurring causes of grievances through corrective and preventive measures. The Life Insurance Council, General Insurance Council and Council for Insurance Ombudsmen will support the initiative by sensitising member insurers, while IRDAI, in coordination with the Councils and State-wise Lead Insurers, will conduct outreach programmes across the country, with particular focus on Tier-II and Tier-III cities. The initiative aims to ensure meaningful, fair and sustainable grievance resolution and reinforce policyholder trust.
Read: IRDAI Declares November 2026 Grievance Resolution Month
IRDAI Extends Consultation Window on Distribution Reforms
IRDAI, vide press release dated October 24, 2026, extended the deadline for submission of comments on its consultation paper titled “Recalibrating Economics of Insurance Distribution” from October 25, 2026 to October 31, 2026. The extension was granted in view of the encouraging response, with over 650 comments received, and to facilitate wider stakeholder participation. The two-part consultation paper, released on September 23, 2026, seeks feedback on proposed reforms to promote a more efficient and inclusive insurance distribution ecosystem. Stakeholders may submit their comments through the designated web portal or by email, using the prescribed Excel template. All other details and terms of the consultation paper remain unchanged.
Read: IRDAI extends feedback window for proposed insurance distribution reforms
IRDAI Advises Regulated Entities to Observe National Cyber Security Awareness Month
IRDAI, vide circular dated October 7, 2026, advised all regulated entities to observe October 2026 as “National Cyber Security Awareness Month” (“NCSAM”) to promote cyber security awareness across the public and private sectors. Regulated entities were encouraged to organise activities promoting cyber hygiene and conduct wider public awareness campaigns through various media, including television, community radio, radio jingles, reels, memes and SMS. They were further advised to submit an Action Taken Report to IRDAI at infosec@irdai.gov.in by November 3, 2026, detailing the action taken in this regard.
Read: IRDAI Directs Regulated Entities to Observe National Cyber Security Awareness Month in October 2026
From the docket
NCDRC Upholds Repudiation of Fire Insurance Claim for Delayed Premium Payment, but Directs Refund and Compensation
NCDRC, in Neo Essel Dispoware Pvt. Ltd. v. Oriental Insurance Co. Ltd. (Consumer Complaint No. 2463 of 2018), vide order dated October 1, 2026, upheld the repudiation of a fire insurance claim of approximately ₹6.13 crore under an Industrial All Risk Policy, as the insured had paid the premium of ₹28 lakh only in January 2017, beyond the statutory deadline of November 30, 2016. Interpreting Section 64VB of the Insurance Act, 1938 read with Rule 58 of the Insurance Rules, 1939, the NCDRC held that where premium payment is secured by a bank guarantee, the entire premium must be guaranteed to be paid before the end of the calendar month succeeding the month in which the risk is assumed. This statutory timeline cannot be extended or waived through a private arrangement with the insurer. However, the Commission held that the insurer had failed to adequately inform the insured of the statutory deadline and the consequences of delayed payment, thereby breaching its duty of good faith. Accordingly, while declining to set aside the repudiation, the NCDRC directed the insurer to refund the premium of ₹28 lakh with interest at 12% per annum from the date of deposit until realisation and pay ₹43 lakh as compensation, being the premium received for the preceding year’s policy, which too could not have been validly issued, within four weeks. The ruling underscores that contractual arrangements cannot override statutory premium-payment requirements, while also emphasising insurers’ duty to clearly disclose material conditions and their consequences to policyholders.
Read: NCDRC, Consumer Complaint No. 2463 of 2018
Insurer’s denial alone does not prove a motor policy is forged
The Hon’ble Gujarat High Court, in SBI General Insurance Co. Ltd. v. Radhaben Govabhai Desai (Rabari) (Deleted) & Ors., vide judgment dated October 23, 2026, dismissed the insurer’s appeal under Section 173 of the Motor Vehicles Act, 1988, against a Motor Accident Claims Tribunal award of ₹37,00,420 with interest at 9% per annum. The insurer had challenged the award on the ground that the motor insurance policy relied upon by the claimants was fabricated. The Court held that an insurer’s mere denial of having issued a policy does not, by itself, establish that the policy is forged; such an allegation must be substantiated by legally admissible and reliable evidence. In this case, the insurer had failed to produce relevant policy issuance registers, electronic records or premium ledger entries, examine a competent witness from the policy-issuing branch, or adequately pursue its police complaint concerning the allegedly fake policy. The Court further noted that the Tribunal’s “pay and recover” direction against the vehicle owner already protected the insurer’s interests. The decision underscores that insurers disputing the authenticity of a policy must support their allegations with reliable evidence and cannot discharge that burden through a mere denial.
Read: Gujarat High Court, First Appeal No. 5650 of 2019, 2026 LiveLaw (Guj) 294 (23 Oct)
Enforcement
IRDAI Rejects Insurance Broker Registration Application over Non-Disclosure of Promoter’s Regulatory Association
IRDAI, vide order dated October 14, 2026, rejected the application dated July 11, 2024, filed by Anatoly Insurance Brokers Pvt. Ltd. for registration as a Direct Insurance Broker (Life and General). During examination of the application, IRDAI observed that the applicant had failed to disclose that its promoter, Mr. Devender Singh, who held 99% shareholding in the applicant, also held a 50% stake in Kaveri Informatics Pvt. Ltd., a corporate agent whose certificate of registration had been refused renewal by IRDAI on account of serious regulatory violations, including submission of false information and failure to maintain the prescribed minimum net worth. In response to a show cause notice dated June 5, 2026, and during the personal hearing held on August 17, 2026, the applicant attributed the non-disclosure to a mistaken belief that Kaveri’s registration had expired and that the association was therefore no longer relevant, and contended that the promoter was merely a shareholder in Kaveri with no executive role. IRDAI rejected this explanation, observing that the omission was material to the promoter’s fit and proper assessment and that applicants are required to furnish complete and accurate information relevant to their registration. Accordingly, the application was rejected under Regulation 12(1) of the IRDAI (Insurance Brokers) Regulations, 2018. The order may be appealed before the Securities Appellate Tribunal under Section 110 of the Insurance Act, 1938; alternatively, a fresh application may be made after one year from the effective date of the order, if no appeal is preferred.
Read: IRDAI Order in the matter of Anatoly Insurance Brokers Pvt. Ltd.
Beyond India
EIOPA Sets Supervisory Expectations for Private Equity-Backed Insurers
The European Insurance and Occupational Pensions Authority (“EIOPA”), vide its Supervisory Statement dated October 6, 2026, on the authorisation and ongoing supervision of (re)insurance undertakings related to private equity, has outlined supervisory expectations for national competent authorities when assessing acquisitions and conducting ongoing supervision of such undertakings. The Statement highlights risks arising from the potential misalignment between private equity firms’ investment horizons and insurers’ long-term policyholder obligations; complex and opaque ownership structures involving multiple intermediary entities and third-country jurisdictions; increased exposure to private credit and other illiquid assets; high leverage and debt-funded acquisitions; and extensive reliance on reinsurance arrangements, including with third-country reinsurers. EIOPA expects supervisors to examine the entire acquisition financing structure, assess the justification for each level of ownership, scrutinise business plans and investment strategies against adverse and stress scenarios, consider attaching conditions to approvals where significant risks are identified, and ensure that capital, liquidity and solvency remain adequate to protect policyholders. Supervisors are also expected to assess the effectiveness of risk transfer under reinsurance arrangements, including termination and recapture risks, monitor intragroup transactions and asset-management arrangements on an arm’s length basis, and require insurers to reflect potential exit strategies of private equity owners in their risk assessment. The Statement further emphasises robust governance, independent decision-making and effective management of conflicts of interest arising from the influence of private equity general partners and related entities. It aims to promote consistent, risk-based and proportionate supervisory practices across the European Union.
Read: EIOPA Supervisory Statement on Private Equity-Related (Re)insurance Undertakings
EIOPA Consults on Outcomes-Focused Supervision of Insurance-Based Investment Product Sales
EIOPA, on October 8, 2026, launched a public consultation on a draft Supervisory Statement concerning the supervision of sales processes and pre-contractual disclosures for insurance-based investment products. The consultation follows EIOPA’s market monitoring, which identified practices such as mechanically completing procedural steps, providing lengthy or complex disclosures, and conducting sales assessments that do not meaningfully contribute to consumer outcomes. The draft Statement encourages national supervisory authorities to complement compliance-based supervision with a risk-based, outcomes-focused approach, assessing whether sales processes and disclosures genuinely enable consumers to make informed decisions. It also recognises that additional documentation or procedural requirements do not necessarily improve consumer outcomes and clarifies that the proposed approach does not introduce new regulatory requirements, additional reporting obligations or a prescribed supervisory methodology. Stakeholders may submit comments by January 4, 2027, with early feedback by the end of November 2026 welcomed to inform EIOPA’s work on the Retail Investment Strategy. EIOPA expects to finalise the Supervisory Statement in the first quarter of 2027.
Read: EIOPA Consultation on Draft Supervisory Statement on IBIP Sales Processes
EIOPA Consultation on Draft Supervisory Statement on IBIP Sales Processes
ISDA Desk
ISDA Publishes Recalibrated SIMM Version 2.9+2606
ISDA, on October 30, 2026, published version 2.9+2606 of the ISDA Standard Initial Margin Model (“SIMM”), following its 2026 primary calibration exercise. The revised methodology incorporates recalibration using historical data up to and including June 30, 2026, and updates the risk parameters used to calculate initial margin for non-cleared over-the-counter derivatives. The new version will take effect on December 5, 2026, and SIMM users are expected to apply it to initial margin calculations from close of business on December 4, 2026, with the first exchange of initial margin under the revised methodology scheduled for December 7, 2026. ISDA has reiterated that SIMM remains a central component of the ISDA SIMM Governance Framework, and all users are expected to adhere to that framework. The revised methodology is therefore relevant to market participants using SIMM, who should ensure that their calculation systems and operational processes are updated ahead of the implementation date.
Read: ISDA SIMM Methodology, Version 2.9+2606
ISDA Advances Legal and Accounting Framework for Tokenized Collateral
ISDA, through two papers published in October 2026, examined the legal and accounting implications of using tokenized assets as collateral. Its October 6 paper, Assessing Tokenized Money Market Funds as Eligible Collateral Under the ISDA CSA, identifies legal and operational considerations in accepting tokenized money market fund (“TMMF”) shares as collateral and highlights potential amendments or supplements to standard ISDA collateral documentation, particularly the 2016 Credit Support Annexes for Variation Margin under English and New York law, inviting market feedback on their format and implementation timeline. Separately, its October 27 white paper, Accounting for Tokenized Assets as Collateral, analyses the gross versus net balance sheet treatment of tokenized collateral under IFRS and US GAAP. It concludes that tokenization alone does not change accounting treatment, which continues to depend on the underlying legal rights and settlement arrangements, while appropriately structured distributed-ledger settlement mechanisms may support settled-to-market treatment and potential balance sheet reduction, where legal analysis supports final settlement.
Read: ISDA Paper on Tokenized Money Market Funds as Collateral | ISDA White Paper on Accounting for Tokenized Collateral
DISCLAIMER
The content provided in this newsletter is intended for general awareness and should not be considered as legal advice. Readers are advised to consult with a qualified legal professional regarding any specific issues mentioned herein. If you have any questions about any of these developments or would like to see something different next month, reach out to us at insurance@sarthaklaw.com .
We will be back next month with another update. Thank you for reading!