Establishment and Closure of Liaison Office in India

In October 2022, the Insurance Regulatory and Development Authority of India (IRDAI) released “Guidelines on Establishment and Closure of Liaison Office in India by an Insurance Company registered outside India”. 

Recently, on 11 February 2026, the Insurance Regulatory and Development Authority of India (IRDAI) released an amended version of the guidelines, which became effective from the date of issue.

Check out this blog post to learn what a liaison office is according to IRDAI, and how to establish and close it as per the latest amended guidelines.

What is Liaison Office According to IRDAI?

According to the amended guidelines notified by the insurance market regulator, a Liaison Office (LO) is explained as “a place of office to act as a channel of communication between the Principal place of business or Head Office (HO) by whatever name called, of an Overseas Insurer and entities in India but which does not undertake any commercial/ trading/ soliciting/ industrial activity, directly or indirectly, and maintains itself out of foreign remittances received from the Overseas Insurer through normal banking channels.”

Eligibility Requirements for Opening a Liaison Office 

As per the amended guidelines of IRDAI, the eligibility requirements for opening a liaison office are as follows:-

• The overseas insurer who wants to apply for opening a liaison office must have a financially sound track record. 

• The minimum requirement for applying for opening a Liaison office in India shall include having a profit-making track record during the three financial years immediately preceding the application as well as a net worth of no less than USD 65 million. 

• In special cases, wherein the applicant overseas insurer is a foreign state owned enterprise or reinsurer having strong credit rating or proven expertise/specialized insurer, the IRDAI may relax the minimum net worth requirement. This relaxation may consider the significance of bilateral trade and the potential for market development.

Documents Required to Open a Liaison Office

The following documents are required to open a Liaison Office:-

• Copy of Certificate of registration of the Overseas Insurer (Certificate issued by home country insurance regulator). 

• Copy of Certificate of Incorporation of the Overseas Insurer (Certificate granted by home country authority). 

• Details of subsidiaries and associate companies. 

• Copies of Memorandum of Association (MoA) and Articles of Association (AoA) or any other charter document. 

• Copy of latest Audited Financial statements of the entity. 

• Certificate from the home country insurance regulator that the applicant is duly authorized as an insurer and has the permission to open a Liaison office in India. 

• A Letter of Comfort from applicant Overseas Insurer confirming to provide necessary financial support to Liaison office (Annexure II). 

• A Letter / copy of Board resolution of the applicant Overseas Insurer confirming the authorization provided to the Authorized official for signing and submitting Form IRDAI-FIC-1. 

Liaison Office Application and Approval Process

The LO application and approval procedure takes place in the following manner:-

• The applicant overseas insurer who wants to set up an LO shall apply to the IRDAI in Form IRDAI-FIC-1 (Annexure I). All the details must be filled out accurately in the form.

• Along with the form, all the necessary documents must be attached.

• Once the form is filled and the required documents are attached, the processing fee of 6000 USD (non-refundable) must be paid by way of DD/Pay Order or through online transfer in favour of IRDAI along with the application. 

• After receiving the application, the IRDAI shall review the application. If it meets the eligibility criteria, the authority shall approve the application and authorize the applicant to establish the LO. 

• In case of rejection, the applicant may approach the Authority for review of its decision within 30 days from the date of receipt of the communication.

Note: Before granting approval for LO establishment, the IRDAI may seek views of the Ministry of External Affairs if the application is received from Overseas Insurer incorporated in a country, which shares land border with India. 

Documents Required for Closure of Liaison Office

The following documents are required for closing an LO:-

• A copy of the IRDAI's permission for establishing the Liaison Office in India. 

• A copy of the public notices issued in newspapers notifying the proposed closure of the LO's operations in India. 

• An independent Chartered Accountant's certificate, which must include the following: 

• Explanation of how the remittable amount was calculated, supported by a statement of the LO's assets and liabilities along with details on the disposal of assets. 

• Certifying that all liabilities in India including taxes, duties, arrears of gratuity, employee benefits, rent, etc. have been fully settled/adequately provided for. 

• Certifying that no funds from sources outside India have remained un-repatriated to India. 

• Confirmation from the Overseas Insurer that there are no legal proceedings pending against the LO in any court in India and that there are no legal impediments to the closure/remittance. 

• A report from the Registrar of Companies confirming compliance with the provisions of Companies Act 2013 if the winding up of the LO in India is applicable.

Liaison Office Closure Process

The LO closure procedure takes place in the following manner, as per the IRDAI guidelines 2026:-

• The request for closing the LO must be submitted to the IRDAI using form IRDAFIC-2 (Annexure IV), at least two months prior to the date of expiry of the validity of the approval. 

• At least two months prior to the closure of its operations in India, the LO must publish a notice to inform its operations’ proposed closure in India in at least one English daily newspaper that is circulated in whole or substantially the whole of India and in one newspaper published in the regional language of the state where the LO is located.

• Along with the application for Liaison Office’s closure, all the necessary documents must be attached.

• The IRDAI shall grant the approval for closure and remittance of proceeds given the Liaison Office has submitted the Annual Activity Certificate for all the years for which it was in operation in India. 

• The remittances will be made as per the terms and conditions of RBI / FEMA / CBDT.

• The authority shall give its approval for closing the LO of an overseas insurer and will also intimate the RBI regarding the LO’s closure.

Conclusion

For opening or closing a Liaison Office (LO) in India by an insurance company registered outside India, it is necessary to ensure compliance with the IRDAI regulations. For the establishment of Liaison Office, Form IRDAI-FIC-1 in Annexure I must be submitted to IRDAI along with necessary documents and the processing fee. In case of closure of Liaison Office, Form IRDAI-FIC-2 in Annexure IV must be submitted to the Authority.

Need assistance in setting up an insurance company or in ensuring compliance with IRDAI regulations? Connect with our IRDAI license consultants at Registrationwala!

Author: Dushyant Sharma

Hey there, I'm Dushyant Sharma. With the extensive knowledge I've gained in past 8 years, I have been creating content on various subjects such as banking, insurance, telecom, and all the important registration and licensing processes for various companies. I'm here to help everyone with my expertise in these areas through my articles.