Ajay Seth's Task: Stabilizing the Insurance Sector Amid Regulatory Changes

Ajay Seth, former Department of Economic Affairs secretary, has been appointed as the new chairman of the Insurance Regulatory and Development Authority of India (Irdai) for a three-year term. Seth's key challenge will be to stabilize the insurance sector and steer regulatory transitions, amid a slowdown in growth and major reforms underway. He will focus on framing regulations on amendments to the Insurance Act and other priorities.

Ajay Seth, a distinguished economist with over three decades of experience in public finance and economic policy, has been appointed as the new chairman of the Insurance Regulatory and Development Authority of India (Irdai) for a three-year term [2]. His appointment comes after a lengthy vacancy following the departure of Debashish Panda in mid-March.

Seth's extensive background in economic policy and finance positions him well to lead Irdai through its current challenges. His key responsibilities will include stabilizing the insurance sector and steering regulatory transitions, amidst a slowdown in growth and significant reforms underway. He will focus on framing regulations, particularly amendments to the Insurance Act, and addressing other priorities.

One of the immediate tasks for Seth will be to implement Irdai's proposal for an internal ombudsman to handle claims up to ₹50 lakh. This initiative aims to provide time-bound grievance redressal for insurers with over three years of operations [1].

Additionally, Seth's tenure will coincide with the entry of new players in the reinsurance segment, which is expected to intensify competition. New private players like Valueattics Re, Jio Financial Services, and Allianz are set to join the market, potentially challenging the established positions [1].

Seth's appointment also comes at a time when the insurance sector is experiencing a slowdown in life insurance policy sales. The sector witnessed a 10% drop in sales in Q1FY26, driven by a slowdown in credit life policies due to subdued credit demand [1]. However, the industry is also seeing growth in non-life insurance premiums, with a 9% rise in Q1FY26, driven by general and standalone health insurers [1].

The appointment of Ajay Seth as the new Irdai chairman marks a significant milestone in the regulatory landscape of the insurance sector. His experience and expertise will be crucial in navigating the complex challenges and opportunities that lie ahead.

References:
[1] https://www.business-standard.com/author/aathira-varier
[2] https://timesofindia.indiatimes.com/business/india-business/ajay-seth-appointed-new-irdai-chairman/articleshow/122884885.cms