India's IRDAI Proposes New Framework for Transparent Regulation-Making and Public Consultation

India's insurance regulator has moved to formalize and modernize how it makes rules, proposing a comprehensive framework that brings greater structure, transparency, and accountability to the regulation-making process. On June 17, 2026, the Insurance Regulatory and Development Authority of India (IRDAI) published a draft framework for making regulations and issuing subsidiary instructions under the Sabka Bima Sabki Raksha (Amendment of Insurance Laws) Act, 2025.

The draft regulation seeks to standardize the process for framing, amending, and reviewing insurance regulations, while codifying existing practices around stakeholder engagement, public consultation, and the publication of draft regulations. Under the proposal, IRDAI would be required to publish all draft regulations on its website along with a statement of particulars detailing the statutory provisions invoked and the rationale behind the proposed rules. This represents a significant step toward predictable, consultative rule-making in a sector undergoing rapid liberalization.

A key feature of the proposal is mandatory cost-benefit analysis. Before finalizing any regulation, IRDAI would be required to assess the expected costs and benefits of proposed rules on policyholders, industry participants, and the broader economy. Additionally, all insurance regulations would be subject to review once every three years from the date of publication, unless an earlier review, amendment, or repeal is deemed necessary — embedding a regular feedback and update mechanism into the regulatory cycle.

For issuing subsidiary instructions, the framework proposes constituting consultative committees comprising external experts drawn from insurance, finance, law, and information technology, alongside industry representatives and regulator officials. The recommendations of these committees would feed into the rule-making process. IRDAI has invited comments and suggestions from stakeholders on the draft framework until July 8, 2026. The move comes amid a broader reform wave in India's insurance sector, which recently saw the government permit 100% foreign direct investment under the automatic route and pursue its 'Insurance for All by 2047' vision.