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The Insurance Regulatory and Development Authority of India (Irdai) on 22 January notified Guidelines on Cross Border Re-insurers (CBR). The Guidelines aim to streamline the regulatory process with respect to CBRs. According to the Irdai guidelines, "The insurer who wish to place reinsurance business with CBR shall file an online application with the Authority in the form as specified in the guidelines."

Who are Cross Border Reinsurers (CBR)?

CBRs are those reinsurers who do not have any physical presence in India and do reinsurance business with Indian insurance / reinsurance companies. Irdai guidelines state the following details for filing application for CBRs:

1. All CBRs shall necessarily comply with the eligibility criteria of the IRDAI (Re-insurance) Regulations, 2018. Click here to visit the portal.

2. Filing of application for allotment of (Filing reference number) FRN to CBR shall be commensurate with Re-insurance program of the insurer, as submitted with the Authority in terms of the IRDAI (Re-Insurance) Regulations, 2018.

3. The insurer who wishes to place re-insurance business with CBR shall file an online application with the Irdai, for allotment of FRN for CBR under the category of eligible CBR or non-eligible CBR, as the case may be.

4. The Irdai may raise any other requirements if necessary, for processing of such application for allotment of FRN to CBR. After examination of submissions made by the insurer, the Authority may allot system-generated FRN to the CBR within three working days from receipt of the last document.

5. All the re-insurance business placements made with the cross-border reinsurers who do not comply with eligibility criteria, shall be placed before the board of directors of the insurer for their approval / ratification, and certified copy of such resolution shall be filed with the Irdai, as per the guidelines.

Other general provisions guidelines issued by Irdai:

1. The insurer shall not transact reinsurance business with any CBR without valid FRN.

2. The Irdai will allot country-wise separate FRN to the CBR.

3. The FRN allotted shall be valid for one financial year for which application is filed by the insurer.

4. Once FRN is allotted for any particular CBR the same may be used by another insurer for placement of re-insurance business with such CBR, the guidelines said.

5. The insurer, within thirty days of the commencement of the financial year, shall submit a certificate of compliance to the authority confirming that, the re-insurance placements made to CBRs who comply with the eligibility criteria or with those CBRs prescribed in these guidelines. This certificate is to be filed with the authority along with submissions required to be made as per the Irdai (re-insurance) Regulations, 2018.

6. Notwithstanding anything contained in these guidelines, the insurer shall comply with the Insurance Act, 1938 and other applicable regulations issued by the Authority from time to time, as per the guidelines.

ABOUT THE AUTHOR

Navneet Dubey

Navneet Dubey is a personal finance writer and artist. Over the past decade, he has written feature stories on insurance, financial planning, lending and borrowing.
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