# Framework provides a structured roadmap for insurers to strengthen cost governance, transparency and assurance
1 October 2026, New Delhi:
The Institute of Cost Accountants of India (ICMAI) has presented the “INSCOST – Cost Management, Cost Governance, Cost Disclosure & Cost Assurance Framework for the Indian Insurance Sector”, a sector-specific framework developed to strengthen cost discipline, transparency, governance and assurance across the Indian insurance industry. The publication is the First Edition, 2026, brought out by The Institute of Cost Accountants of India (ICMAI).
CMA Chittaranjan Chattopadhyay, President, ICMAI, stated, “I am pleased to present this Framework at an important stage in the evolution of the Indian insurance sector. As India advances towards the vision of ‘Insurance for All by 2047’ and the broader objective of Viksit Bharat, sound cost management and cost governance will be increasingly important for efficiency, sustainability and policyholder value.”
The INSCOST Framework addresses an important structural requirement by providing a dedicated and sector-specific body of guidance covering cost records, cost management, cost governance, cost disclosure and cost assurance, while also extending into strategic cost management and product profitability. During the presentation, ICMAI highlighted the framework as the first comprehensive sub-sector differentiated work of its kind globally, covering Life, General, Health, Reinsurance and Public-Sector insurance entities.
The framework adapts the established Cost Accounting Standards, Cost Auditing Standards and Generally Accepted Cost Accounting Principles of ICMAI to the distinctive economics of insurance and aligns them with the regulatory architecture of the Insurance Regulatory and Development Authority of India (IRDAI). It provides guidance on cost allocation, Expenses of Management, claims and distribution costs, bancassurance, government-sponsored schemes, strategic cost analytics and product profitability.
A key focus highlighted during the presentation was the need for the insurance sector to give greater attention to cost management alongside claims management. Effective control and governance of acquisition, procurement and other operational costs can support underwriting discipline and help insurers work towards greater efficiency and profitability in their core insurance business.
CMA Manoj Anand, Vice President, ICMAI, said, “The INSCOST Framework is designed to bring a sharper focus on the role of cost information in strengthening decision-making across the insurance value chain. By enabling insurers to understand and manage costs at the product, process and operational levels, the Framework can support greater efficiency, transparency and sustainable profitability while strengthening value for policyholders.”
The Framework also seeks to support more cost-effective insurance products and wider insurance penetration. It positions cost not merely as an accounting number but as an important management and governance parameter, encouraging insurers to assess what drives their costs, whether processes are efficient, whether product costs are aligned with value and whether management decisions are supported by reliable cost information.
The Framework further introduces a Cost Maturity Model and phased Implementation Roadmap, enabling insurers to progressively strengthen their cost management and assurance practices in accordance with their size and readiness. It also highlights the expanding role of Cost and Management Accountants in areas such as product-level profitability, claims cost analysis, operational efficiency, distribution cost management, process optimisation, budgeting and strategic decision-making.
The publication is particularly timely in the context of the IRDAI Public Consultation Paper on “Reforms for Recalibrating Economics of Insurance Distribution” issued on 23 September 2026, which has significant relevance to cost rationalisation, Expenses of Management, commission structures, cost transparency and cost audit.
“I commend the INSCOST Framework to insurers, Boards of Directors, regulators, practitioners and the wider professional community. I believe this initiative will contribute to stronger cost governance and create meaningful opportunities for Cost and Management Accountants to support the evolving insurance sector,” the President added.
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