Insurers are well advised to put in place a "whistle blower policy" whereby mechanisms exist for employees to raise concerns internally about possible irregularities, governance weaknesses, financial reporting issues or

Insurers are well advised to put in place a "whistle blower policy" where, by mechanisms exist for employees to raise concerns internally about possible irregularities, governance weaknesses, financial reporting issues or other such matters. These could include employee reporting in confidence directly to the Chairman of the Board or of a Committee of the Board or to the Statutory Auditor. The Whistle-Blower Policy shall inter alia cover the following aspects: Awareness of the employees that such channels are available, how to use them and how their report will be handled. Handling of the reports received confidentially, for independent assessment, investigation and where necessary for taking appropriate follow-up actions. A robust anti-retaliation policy to protect employees who make reports in good faith. Briefing of the board of directors. The appointed actuary and the statutory/internal auditors have the duty to 'whistle blow', i.e., to report in a timely manner to the IRDAI if they are aware that the insurance company has failed to take appropriate steps to rectify a matter which has a material adverse effect on its financial condition. This would enable the IRDAI to take prompt action before policyholders' interests are undermined.