IFSCA on 11th April, 2023 has issued International Financial Services Centers Authority (Re-insurance) Regulations, 2023 to provide framework for oversight and control of inward and outward arrangement of re-insurance business by the International Financial Service Centre Insurance Offices (IIOs).
The regulations provides that the senior management of the IIO or Parent Entity of the IIO, as the case may be, shall –
(a) develop, implement and maintain RSRP which shall be relevant to the operations of the IIO and shall ensure that the IIO has sufficient resources to meet their business obligations;
(b) formulate operational policies and procedures for implementing the RSRP;
(c) develop clear methodologies for evaluating re-insurance arrangements of the IIOs, including but not limited to –
(i) identification of tolerance to risk;
(ii) identification of the segment-wise risk retention levels vis-à-vis tolerance to risk with
appropriate re-insurance arrangements;
(iii) selection of the panel of re-insurers used, including consideration of diversification and
credit worthiness of the re-insurers;
(iv) management of all possible concentration of risks with respect to a particular industry,
geographical region, product type, and/or single insured in the insurer’s underwriting
books;
(v) involvement of re-insurance brokers if any, including their role in structuring the reinsurance
arrangements;
(vi) the process for monitoring, reviewing and updating the RSRP;
(vii) management of credit and liquidity risk;
(viii) management of legal risk arising from the re-insurance contract;
(d) develop robust internal control systems to ensure that all business activities are carried out in
compliance with the RSRP;
(e) develop effective reporting systems to satisfy the requirements specified by the Board;
