Sri Lanka Insurance Industry – Governance, Risk and Compliance

The Sri Lankan insurance market report provides detailed analysis of the insurance regulations for life, property, motor, liability, personal accident and health, and marine, aviation and transit insurance. The report specifies various requirements for the establishment and operation of insurance and reinsurance companies and intermediaries.

The report also brings together research, modeling and analysis expertise, giving insurers access to information on prevailing insurance regulations, and recent and upcoming changes in the regulatory framework, taxation and legal system in the country. The report also includes the scope of non-admitted insurance in the country.

What are the market dynamics in the Sri Lanka insurance industry?

The Insurance Regulatory Commission of Sri Lanka (IRCSL) was established to ensure that the insurance business in the country is carried out with integrity, professionally and prudently, governs the insurance industry in Sri Lanka. The Commission also safeguards the interest of (potential) policyholders and provides advice to the government regarding regulations related to insurance to maintain the stability of the market.

What are the key types of licenses issued in the Sri Lanka insurance industry?

The different types of insurance licenses issued in the Sri Lankan insurance industry are long-term insurance license, general insurance license, reinsurance license for insurance, and composite license. 

Long-term insurance in Sri Lanka

Companies with a license for long-term insurance business can underwrite and sell life insurance contracts, linked long-term, annuities, permanent health, capital redemption, and pension policies.

General insurance license in Sri Lanka

Companies with the license for general insurance business underwrite and sell insurance contracts related to marine, aviation, and transit insurance, fire insurance, motor vehicle insurance, employers’ liability insurance, and miscellaneous insurance contracts. 

Reinsurance license in Sri Lanka 

License for reinsurance business enables the reinsurer to offer insurance products to other insurance companies covering their financial risks. Section 31 of the RII Act states that an insurer may reinsure its liabilities arising out of an insurance contract, with any other insurer in or outside Sri Lanka following the terms and conditions specified by the IRCSL. The IRCSL may ask the reinsurer to furnish the necessary information to ascertain whether the insurer has the funds needed to satisfy any claims.

Composite insurance license in Sri Lanka 

Composite insurers are the insurers permitted to underwrite both long-term and general insurance contracts. Section 53 of the Regulation of Insurance Industry (Amendment) Act 2011 demands all-composite insurers to segregate their life and non-life units into separate business entities by February 2016.

Sri Lanka insurance industry, by license type

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Which other associations oversee the Sri Lankan insurance industry?

The key associations that oversee the Sri Lankan insurance industry are the International Association of Insurance Supervisors (IAIS) and the Insurance Association of Sri Lanka (IASL).

International Association of Insurance Supervisors 

The IAIS is a membership-driven global organization that represents insurance regulators and supervisors of more than 200 jurisdictions in over 140 countries. The IAIS formulates and issues various global insurance principles, standards, and guidance, provides training and support on issues related to insurance supervision, and organizes meetings and seminars for insurance supervisors. It works closely with other financial sector standard-setting bodies and international organizations to promote financial stability.

The primary objectives of the IAIS are to promote effective and globally consistent supervision of the insurance industry to develop and maintain fair, safe, and stable insurance operations for the benefit and protection of policyholders, and to contribute to global financial stability.

Insurance Association of Sri Lanka (IASL)

The IASL established in 1989 promotes the sound development of the insurance industry in Sri Lanka. All licensed insurers except NITF are members of the IASL. Some of the key objectives of IASL include ensuring professionalism, in insurance practices through training and education programs, ensuring discipline and ethical conduct among members, bringing together insurers and reinsurers operating in the country, and so on.

Market report scope

Scope 

• The report covers details of the insurance regulatory framework in Sri Lanka.
• The report contains details of the rules and regulations governing insurance products and insurance entities.
• The report lists and analyzes key trends and developments about the country’s insurance regulatory framework.
• The report analyzes the rules and regulations about the establishment and operation of insurance businesses in the country.
• The report provides details of taxation imposed on insurance products and insurance companies.

Reasons to Buy

• Provides FAQ-style analytical insights comprising 129 knowledge elements on insurance compliance applicable to the country
• Gain insights into the insurance regulatory framework in Sri Lanka.
• Track the latest regulatory changes and expected changes impacting the Sri Lankan insurance industry.
• Gain detailed information about the key regulations governing the establishment and operation of insurance entities in the country.
• Understand key regulations and market practices about various types of insurance products.