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Reference No.: IRDA/ INT/ CIR/ RSB/ 032/ 02/ 2019
Date: 05/02/2019
Report of Committee on Regulatory Sandbox in insurance sector in India

Report of Committee on RegulatorySandbox in insurance sector in India



Ref.No.: IRDA/ INT/ CIR/ RSB/ 032/ 02/ 2019 Date: 5thFebruary, 2019



TheAuthority, vide order No. IRDA/F&A/ORD/MISC/151/09/2018 dated 18thSeptember, 2018, had constituted a committee on Regulatory Sandbox in insurancespace in India under the Chairmanship of Mr. Randip Singh Jagpal, CGM, IRDAI.


A“Regulatory Sandbox Approach” can be used to carve out a safe and conducivespace to experiment with Fin-Tech solutions, and where the consequences offailure can be contained. The objective of Regulatory Sandbox is tofacilitate innovations in the insurance sector, make the insurance productsmore affordable and relevant for the insured and to give a fillip to insurancepenetration. 


Inthis context, the Committee had invited suggestions/comments, on the saidsubject, from all Insurance, Reinsurance companies and Foreign ReinsuranceBranches in India.


Onthe basis of the comments, inputs and advices received, the Committee hasdrafted the final report on the Regulatory Sandbox.


Followingare the key recommendations of the Committee:


1)   Thepurpose of the Regulatory Sandbox is to foster growth and increase the pace ofthe most innovative companies, in a way that provides Insurtech in particularand the Fintech sector as a whole with flexibility in dealing with regulatoryrequirements and at the same time focussing on policyholder protection.

2)   TheAuthority should create a core Sandbox Committee having dedicated personnel tomonitor and supervise the digital innovation activities, and provide supportand advisory to the applicants as envisaged in the draft guidelines. TheCommittee would facilitate roll out of the experiments and seek to provide theecosystem required for the experimentation.

3)   TheRegulatory Sandbox would have defined entry and eligibility criteria, boundaryconditions, process flow, timelines and success factors / exit parameters forthe applicants, along with appropriate controls for protection and riskmanagement.

4)   Atthe same time, the process and criteria would be flexible to provide aconducive environment for encouraging and enabling a wide variety ofexperimentation, including provisions for no enforcement action orders, waiversand relaxed reporting requirements.

5)   Thecommittee proposes a cohort basis approach for receiving applications. Theapplicants would include insurers or insurance intermediaries or any otherentity other than an individual having a minimum net-worth of Rs 25 lakhs forlast 3 years.

6)   Theapplicant can apply in any one of more of the 5 categories namely insurancesolicitation or distribution, insurance products, underwriting, policy &claims servicing and any other. The applicant could apply singly or jointly in oneor more than one category, provided that if the category involves insuranceproduct or underwriting, then the applicant necessarily has to partner with aninsurer.

7)   Thepermission shall be granted for a period of 6 months which can be extended foranother 6 months. In no case can the proposal be allowed to go beyond 12months. However, if the proposal covers 5,000 persons or completes Rs. 50 lakhsof premium or any other parameter which the Authority specifies, the proposalwill deem to have been completed.

8)   Strictrequirements around confidentiality of policyholder’s data have been proposed.


Thereport is attached for comments, which may be sent in the enclosed format, onor before 26th February, 2019 to undersigned at with acopy to Mr. R K Sharma @



RandipSingh Jagpal



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