Insurance Compliance Checklist 2026
Download the comprehensive compliance checklist for insurance operations in 2026. Requirements by region: US (NAIC), UK (FCA Consumer Duty), EU (GDPR, IDD), Middle East (SAMA, CBUAE).
Why Compliance Matters More Than Ever
Regulatory requirements for insurance carriers have expanded significantly in recent years. From the FCA's Consumer Duty in the UK to GDPR enforcement across the EU to state-by-state market conduct examinations in the US, carriers face unprecedented compliance scrutiny.
The cost of non-compliance is rising: regulatory fines, reputational damage, remediation expenses, and potential license restrictions. But compliance also creates competitive advantage. Carriers with robust compliance infrastructure can enter new markets faster, respond to regulatory inquiries efficiently, and build trust with customers and partners.
This checklist covers the essential compliance requirements for insurance operations across four major markets. Use it to assess your current state, identify gaps, and prioritize improvements.
NAIC Model Regulations & State Requirements
US insurance regulation is state-based, but most states adopt NAIC model regulations as the foundation. Compliance requirements focus on market conduct, claims handling, data security, and consumer protection.
Core Compliance Requirements
- Market conduct examination readiness: Maintain complete claim files with all documents, communications, and decision rationale readily accessible for multi-state regulatory reviews. Examiners expect to sample files and find complete documentation within minutes, not hours.
- Claim file documentation standards: Each file must include proof of investigation (photos, estimates, statements), settlement rationale (how payment was calculated, what coverage applied), all customer communications (dates, methods, content), and supervisor review evidence for claims above authority limits.
- Unfair claims practices compliance: Demonstrate fair dealing through timely acknowledgment (typically 15 days), regular status updates (every 30-45 days), prompt investigation, reasonable settlement offers, and clear explanation of denials or reduced payments.
- Data security and privacy: Implement cybersecurity programs meeting state requirements (23 NYCRR 500 in New York, others following similar models). Includes risk assessment, access controls, encryption, incident response plans, and vendor management.
- Complaint handling and reporting: Track and respond to all consumer complaints, maintain complaint logs, report to state regulators as required (quarterly or annually depending on state), and demonstrate corrective actions for systemic issues.
- Producer licensing and appointment tracking: Verify all producers are properly licensed in states where they sell, maintain active appointments, track continuing education compliance, and report terminations for cause to state regulators.
- Claim settlement timeframe compliance: Meet state-specific deadlines for acknowledgment, investigation completion, and payment. Most states require payment within 30-60 days of settlement agreement. Late payment may trigger interest penalties.
- Explanation of benefits and denials: Provide clear, specific reasons for any denial or reduced payment. Reference policy language, explain coverage determination, and inform customer of appeal rights. Vague denials invite complaints and regulatory scrutiny.
FCA Consumer Duty Requirements
The FCA's Consumer Duty, effective July 2023, represents the most significant shift in UK insurance regulation in decades. It requires firms to act in good faith, avoid foreseeable harm, and enable customers to pursue financial objectives. Compliance requires evidence, not just policies.
Core Compliance Requirements
- Consumer Duty four outcomes evidence: Demonstrate through data that products and services are fit for purpose, price and value are reasonable, customers understand what they're buying, and customer support is effective. "We think so" is not evidence—you need metrics and customer feedback.
- Fair value assessments with supporting data: Conduct regular assessments showing that total price (premium plus charges) provides fair value relative to benefits. Include claims payout ratios, expense analysis, and comparison to market. Document methodology and findings.
- Board-level oversight and MI dashboards: Senior management must receive regular management information on Consumer Duty outcomes. Board should review metrics quarterly, challenge findings, and direct corrective actions. Minutes should reflect this oversight.
- Customer communications review: All customer communications must be clear, not misleading, and enable good decision-making. Test communications with actual customers. Avoid jargon, hidden terms, and ambiguous language. Plain English is not optional.
- Vulnerable customer support protocols: Identify customers in vulnerable circumstances (financial difficulty, health issues, bereavement, etc.) and provide appropriate support. Train staff, adjust processes, and track outcomes for vulnerable customers separately.
- Immutable audit trails for regulatory reviews: FCA expects to see the complete journey of every customer interaction and decision. Who spoke to the customer? What information was provided? How was coverage determined? What alternatives were considered? All must be documented and retrievable.
- Product governance and target market: Define target market for each product, assess suitability throughout product lifecycle, and ensure distribution channels reach target market appropriately. Document decisions and review at least annually.
- Outcome monitoring and corrective action: Don't just measure outcomes—act on them. If data shows poor outcomes for specific customer segments, products, or processes, you must investigate and implement improvements. Document the analysis and remediation.
GDPR, IDD, and Solvency II Requirements
EU insurance regulation combines data protection (GDPR), distribution rules (IDD), and solvency requirements (Solvency II). Cross-border operations add complexity with data residency, processing agreements, and supervisory coordination.
Core Compliance Requirements
- GDPR compliance (data residency, consent, erasure): Personal data must be processed lawfully with appropriate legal basis, stored in EU/EEA or under adequacy decision, protected with appropriate security measures, and erasable upon valid request. DPO required for most insurers.
- IDD customer information requirements: Provide standardized pre-contractual information (Insurance Product Information Document), disclose distributor status and remuneration, assess customer needs and demands, and document suitability or appropriateness where applicable.
- Cross-border data processing agreements: Contracts with processors must include GDPR Article 28 requirements: processing instructions, confidentiality, security measures, sub-processor requirements, data subject rights support, audit rights, and breach notification obligations.
- Solvency II Pillar 3 disclosures: Public reporting of solvency position, risk management system, and governance. Audit trails support internal model validation and regulatory review of risk assessment and capital adequacy calculations.
- AI Act compliance readiness: If using AI for underwriting or claims decisions (high-risk use case), prepare for conformity assessment, risk management, data governance, transparency, human oversight, and accuracy/robustness requirements. Enforcement begins 2026-2027.
- Data breach notification procedures: Report breaches to supervisory authority within 72 hours if risk to rights and freedoms. Notify affected individuals without undue delay if high risk. Maintain breach register and document decision-making for non-reported breaches.
- Right to erasure implementation: Assess each erasure request for validity, identify and delete all personal data (including backups and analytics systems), document exceptions if retention required by law, and confirm completion to data subject within one month.
- Data protection impact assessments: Conduct DPIAs for high-risk processing (automated decisions, large-scale special category data, systematic monitoring). Document necessity, proportionality, risks, safeguards, and approval before processing begins.
SAMA, CBUAE, and GCC Requirements
Middle East insurance markets are rapidly developing regulatory frameworks focused on operational resilience, customer protection, and digital transformation. Requirements vary by jurisdiction but share common themes around risk management and local data residency.
Core Compliance Requirements
- SAMA unified regulatory framework (Saudi Arabia): Comply with integrated prudential, conduct, and operational requirements including risk management framework, internal controls, complaints handling, policyholder protection, and digital channel governance. Regular attestation required.
- CBUAE operational risk requirements (UAE): Implement operational risk management framework covering processes, systems, people, and external events. Document risk assessment, controls, monitoring, and reporting to senior management and board.
- Mandatory health insurance processing (GCC markets): Meet requirements for mandatory health insurance schemes (e.g., Dubai, Abu Dhabi, Saudi Arabia). Includes network provider management, pre-authorization, claim adjudication, and regulatory reporting to health authorities.
- Takaful Sharia compliance (if applicable): Separate participant and shareholder funds, establish Sharia Supervisory Board, ensure products and operations comply with Islamic finance principles, and maintain transparency in surplus distribution and risk sharing.
- Arabic language support and documentation: Provide policy documents, claim communications, and customer service in Arabic. Some markets require Arabic as primary language with English as secondary. Translation accuracy is subject to regulatory review.
- Local data residency requirements: Store customer data within the country or designated data centers approved by regulators. Cross-border data transfer may require regulatory approval or customer consent. Cloud providers must demonstrate compliance.
- Claims settlement timeframes: Meet regulator-defined SLAs for claim acknowledgment, processing, and payment. Dubai DFSA, for example, requires acknowledgment within 5 business days and resolution within 15 days for straightforward claims.
- Regulatory technology and reporting: Implement systems supporting automated regulatory reporting to SAMA, CBUAE, or other supervisory authorities. Reports include financial statements, solvency metrics, claims statistics, and complaints data.
How Technology Supports Compliance
Modern compliance requirements can't be met with manual processes and spreadsheets. You need purpose-built technology that makes compliance automatic, not an afterthought.
Immutable Audit Trails
Every action, decision, and data change must be logged with full context: who, what, when, why, and what data they saw. Audit trails must be tamper-proof and searchable for regulatory reviews.
What to look for: Complete document version history, user action tracking with timestamps, decision rationale capture, search and export capabilities, and retention policies that survive system migrations.
Workflow Automation with SLA Enforcement
Manual tracking of deadlines and SLAs is error-prone and doesn't scale. Automated workflows enforce timeframes, escalate exceptions, and ensure no claim falls through the cracks.
What to look for: Configurable SLA rules by claim type and jurisdiction, automatic escalation when deadlines are missed, real-time dashboards for management oversight, and exception reporting for compliance review.
Data Security & Privacy Controls
GDPR, state data security laws, and regional requirements demand robust data protection. Role-based access, encryption, data residency, and breach detection are baseline requirements.
What to look for: Role-based access control with principle of least privilege, data encryption at rest and in transit, regional data residency options, audit logging of all data access, and automated breach detection.
Regulatory Reporting Automation
Regulatory reports—market conduct, financial, complaints, claims statistics—require accurate data pulled from multiple systems. Manual compilation is slow and error-prone.
What to look for: Pre-built report templates for common regulatory filings, automated data aggregation from workflow and document systems, scheduled report generation, and export in required formats (XBRL, XML, CSV).
Get the Full Compliance Checklist with Regulatory Citations
The complete checklist includes regulatory reference citations, evidence requirements for each item, audit preparation guidance, and gap analysis template. Available in PDF and Excel formats.
Need help meeting these requirements?
Regure provides audit-ready compliance out of the box with immutable audit trails, automated SLA enforcement, and regional data sovereignty. See how we handle your specific compliance requirements.