IRDAI Chief Calls for Unified Framework on Climatic Financial Risk

IRDAI Chairman Ajay Seth emphasized the importance of regulators working together to devise a unified framework for identifying and managing climatic financial risks. He highlighted the need for coordinated strategies to strengthen cyber security and ensure long-term financial stability without hindering developmental goals.

The Insurance Regulatory and Development Authority of India's (IRDAI) Chairman Ajay Seth called for a unified and consistent framework to tackle systemic climatic financial risks. Speaking at the 10th corporate governance summit, he stressed collaboration between regulators and the government in addressing these emerging financial challenges.

Seth noted the increasing interconnectivity between different financial sectors, pointing to past crises like the ILFS default in 2018, which had significant ripple effects across markets. He emphasized the importance of a coordinated strategy in addressing disruptions to prevent financial instability.

The IRDAI chief also discussed the anticipated release of a draft strategy on cyber security for the financial sector by early 2026. He acknowledged the advanced oversight of cyber risks by Indian authorities but highlighted the need for extensive crisis simulations and stress tests to bolster sector-wide resilience.

(With inputs from agencies.)