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Industry Specific - Insurance Central Ministry of Finance Insurance Act, 1938

IRDAI (Insurance Fraud Monitoring Framework) Guidelines, 2025

09-Oct-2025 | Ref: IRDAI/IID/GDL/MISC/112/10/2025

IRDAI has issued IRDAI (Insurance Fraud Monitoring Framework) Guidelines 2025, effective from 1st April, 2026. a. Applicability- Apply to all insurers and distribution channels which is insurance agents, intermediaries or insurance intermediaries, and any persons or entities authorised by the Authority to involve in sale and service of insurance policies. b. Objective- To establish a comprehensive framework in order to deter, prevent, detect, report, and remedy fraud risks effectively across the insurance industry. Key Highlights of these Directions: 1. Each insurer shall establish appropriate systems and processes to deter, prevent, detect, report, and remedy fraud, and shall report such frauds. 2. Each insurer shall adopt a zero-tolerance policy towards fraud and implement an appropriate fraud risk management framework tailored to its business profile. 3. The Risk Management Committee (RMC) of the insurer shall bear responsibility for the effective implementation and oversight of the fraud risk management framework. 4. The fraud risk management framework must be specific to the insurer's business, taking into account factors such as the nature of business, size, risk profile, overall business strategy, products, distribution channels, technology infrastructure, and other relevant parameters. 5. For effective implementation, insurers must adopt measures to identify and assess fraud risks. Based on lines of business, historical experience, and emerging trends, insurers shall identify Red Flag Indicators (RFIs) for detecting fraud and integrate them into their operations accordingly.

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