Insurers told to link top management's pay with claim response, grievance handling: Irdai

Insurance regulator Irdai has directed insurers to link the remuneration of managing directors (MDs), chief executive officers (CEOs) and other senior executives to customer-centric outcomes, including claim responsiveness, grievance redressal and the overall financial health of the company, PTI reported.The Insurance Regulatory and Development Authority of India (Irdai) issued amendments under the IRDAI (Corporate Governance for Insurers) Regulations, 2024, and outlined the revised parameters for remuneration packages and incentives for top management personnel.The new norms have come into effect immediately.In a statement on Tuesday, Irdai said the revised framework forms part of its broader effort to strengthen customer trust, improve transparency and increase accountability across the insurance sector.The performance parameters include financial soundness, product performance, claim responsiveness, timely grievance redressal and removal of dark patterns from insurers' and distributors' websites.The regulator has also mandated disclosure of performance on parameters used for determining remuneration of key management personnel (KMPs).Some disclosures will have to be made monthly and others quarterly in an "easy to access" and "easy to understand" format on insurers' websites, without requiring visitors to provide personal details such as phone numbers.Financial soundness data will be disclosed quarterly, while details related to product performance, claims handling and grievance redressal will need to be published monthly."Evolving expectations of customers and needs of the economy require us to place greater emphasis on measurable customer outcomes, transparency in decision-making, responsiveness, and sustainable value creation," Irdai Chairman Ajay Seth said."Accordingly, the revised performance framework will move beyond traditional operational and financial metrics to include a stronger focus on customer-centric and governance-oriented outcomes," he added.The regulator said the updated framework would also empower boards to focus on customer satisfaction, timely claim settlement, reduction in repeat complaints and ensuring transparent and customer-friendly processes.Irdai said it aims to improve transparency and accountability through timely and comparable disclosures across insurers covering the current period and the preceding three years.Separately, Rajay Sinha, Member (Finance and Investment), said revisions related to lowering management expenses, strengthening rural and social obligations and improving coverage of government-backed schemes such as PMJJBY and PMSBY would be considered under future regulatory updates. PTI