Sri Lanka charts decade-long insurance sector reform following major losses

Sri Lanka's insurance regulator has released an extensive reform programme designed to bolster the sector's stability and resilience over the coming decade, following substantial financial losses incurred through the Ditwah event.

The strategic roadmap addresses vulnerabilities exposed by the incident, focusing on enhanced risk management protocols, improved regulatory oversight, and stronger capital adequacy requirements for insurers operating in the country. Officials indicated that the initiative reflects lessons learned from the losses and aims to prevent similar occurrences in future.

The 10-year plan encompasses modernisation of the regulatory framework, expansion of market capacity, and development of professional standards across the insurance industry. Policymakers have prioritised strengthening dispute resolution mechanisms and improving transparency in claims handling procedures.

The announcement comes as the insurance sector continues its recovery from the Ditwah-related losses. Industry stakeholders have acknowledged the need for comprehensive reforms to restore confidence among policyholders and investors in the local market.

Implementation of the roadmap will unfold in phases, with regulatory authorities working alongside industry participants to ensure compliance with new standards and best practices aligned with international guidelines.