IRDA rules out hiking investment limit for insurers

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ENS Economic Bureau: New Delhi, Dec 11 2012, 03:02 IST

per cent exposure in another firm, the takeover code kicks in. If you buy 30 per cent then the company will be compelled to purchase another 20 per cent. So, in no time, it will be owing 50 per cent of the company. In which case insurance companies are supposed to own some companies. Then it will be running some steel companies,” the IRDA chairman pointed out, adding that it may be useful for venture capital firms who are aggressive investors. “Would it be wise thing to do for the insurance companies? The way I think is insurance and pension have to be necessarily very conservative,” he said.

‘Govt should set up a National Health Insurance Scheme’

The Irda on Monday said the government should consider setting up a National Health Insurance Scheme by combining existing health insurance schemes to improve the level of insurance coverage. “The government should look at combining the benefits of schemes like the Aarogyasri scheme and the Rashtriya Swasthya Bima Yojna,” Irda chairman J Hari Narayan said. ENS

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Regulator Asserts

Naren Joshi | 11-Dec-2012Reply | Forward

The insurance regulator desrves kudos from the insurance community for standing up to the might of the Govt. in opposing its plan to hike the investment ceiling for LIC (and later for all life insurers) to 30% as against the existing norm of 10%.Investment norms used by venture capitaalists can not be used for life insurers as it would adversely affect their ability to meet their long term liabilities. Govt. as owner of LIC at times may be tempted to push this mighty financial institution a little too much to further their short term goals like meeting disinvestments targets.Such temptations must be resisted in order to preserve our financial health.One hears some talk about Governments urging for what is euphomistically called "regulatory forbearance". It will not be in our long term interest to unduly armtwist 'independent'regulators. Too much is at stake for the millions of life policyholders in our country to brook any financial adventurism in the insurance sector.