INDIA Law and Practice Contributed by: Neeraj Tuli, Rajat Taimni, Amrit Singh and Anuj Bahukhandi, Tuli & Co
maintenance, fire protection and business-continuity arrangements of each facility. From a claims perspec- tive, the potential for a single infrastructure failure to cause cascading physical damage, business interrup- tion and third-party losses presents challenges in loss assessment. 8.5 Social Media Risk From a health insurance perspective, Section 21 (4) of the Mental Healthcare Act, 2017 requires insurers to provide medical insurance for the treatment of mental illness on the same basis as is available for the treat - ment of physical illness. The IRDAI’s “Master Circular on Health Insurance Business” of 29 May 2024 also requires insurers to make available products catering to a wide range of policyholders and existing medical conditions. While mental health insurance products are widely available in India, specific coverage for social media addiction is not yet a widely recognised insurance product or add-on. Whether treatment arising from compulsive or harmful social-media use is covered would depend upon, among other matters, the nature of the diagnosed condition and the terms and benefits of the relevant health insurance policy. Separately, the erstwhile IRDAI Circular on “Product Structure for Cyber Insurance” of 8 September 2021 included social media liability cover for certain privacy and related liabilities arising from an insured’s use of social media. This is conceptually distinct from health insurance for mental illness or addiction. There does not currently appear to be any developed body of Indian insurance litigation specifically con- cerning coverage for social media addiction. 8.6 Next Generation Nuclear India is yet to see significant reported insurance dis- putes arising specifically from small modular reactors or fusion technologies. However, under the Nuclear Energy Mission announced in the Union Budget 2025– 26, the Government of India aims to develop and operationalise at least five indigenous small modular reactors by 2033.
While these technologies have not yet generated sig- nificant insurance litigation in India, their deployment is likely to increase scrutiny of policy wording, exclu- sions, limits and the allocation of operator and sup- plier risks. 9. Legislative and Regulatory Key Trends 9.1 Regulatory Focus Areas and Supervisory Trends The Indian insurance sector is highly regulated. Dur- ing 2024, the IRDAI introduced and revised several significant norms relating to the protection of policy- holders’ interests, the registration of insurers (includ- ing permitted capital structure and transfer of shares), and the corporate governance framework for insurers, as part of a broader consolidation of the regulatory framework. Some of the key regulatory focus areas affecting insurer behaviour, coverage and insurance litigation are set out below. • The PPHI Regulations along with “Master Circular on Operations and Allied Matters of Insurers” of 19 June 2024 and the accompanying master circulars prescribe standards and timelines for proposal processing, policyholder servicing, claims handling and grievance redressal. This places increasing importance on the insurer’s contemporaneous claims record, communications with the policy- holder, reasons for claims decisions and compli- ance with prescribed processes and timelines. • The IRDAI issued revised Information and Cyber Security Guidelines in April 2026, replacing the earlier framework. The guidelines impose further governance and operational requirements relating to information security, cyber-risk, breach/incident preparedness and accountability to the IRDAI and CERT-In. As Indian insurers increasingly rely on digital infrastructure and third-party service pro- viders, cybersecurity and the record surrounding breach responses are likely to become increasingly relevant to both regulatory scrutiny and insurance disputes. • The IRDAI (Re-insurance) Regulations 2018 (as amended) along with the “Master Circular on Rein- surance 2024” of 31 May 2024 specify norms on
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