Irdai notifies Ind AS norms for insurers; allows one-year forbearance

Regulator allows one-year forbearance and extends parallel reporting to two years as insurers transition to Ind AS framework from April 2026

The Insurance Regulatory and Development Authority of India (Irdai) on Monday issued final regulations for the transition to Indian Accounting Standards (Ind AS), effective April 1, 2026. Under the norms, the regulator has allowed a one-year forbearance for insurers that are unable to prepare and present financial statements in compliance with the new standards. At present, Indian insurers follow the Indian Generally Accepted Accounting Principles (IGAAP) framework.

 

Insurers seeking forbearance will have to submit their requests on or before April 30, 2026.

 

“The competent authority may, having regard to the preparedness of the insurer, the complexity of transition, and such other factors as may be considered relevant, exercise forbearance in respect of an insurer that is unable to prepare and present financial statements in compliance with Indian Accounting Standards. Such forbearance may be granted for one year,” Irdai said in a gazette notification.

 

The regulator has also extended the window for parallel reporting of accounts to two years, from one year proposed in the exposure draft. Ind AS is aimed at aligning India’s accounting framework with International Financial Reporting Standards (IFRS).

 

Irdai said the regulations provide for parallel reporting for a period of two years, or such duration as may be specified, wherein insurers will present financial statements under Ind AS alongside financial information prepared under the existing accounting framework. This approach is intended to help insurers stabilise processes and controls, while enabling stakeholders to assess the impact of the new framework.

 

The regulator has also proposed the creation of a multi-stakeholder expert committee comprising representatives from institutions such as the Institute of Chartered Accountants of India (ICAI), the Institute of Actuaries of India, the Securities and Exchange Board of India (Sebi), and the National Financial Reporting Authority (NFRA). The panel will help address implementation challenges faced by insurers.

 

“These amendments represent a significant step towards modernising the financial reporting framework of the insurance sector in India. By aligning with globally accepted accounting standards, the regulations are expected to enhance transparency, credibility, and regulatory oversight, while safeguarding policyholder interests and supporting the development of a robust and globally aligned insurance ecosystem,” Irdai said.