Insurance regulator Irdai is likely to come out with its final regulations for insurance brokers in its board meeting scheduled on August 28. The Insurance Regulatory and Development Authority of India (Irdai) will also decide on the initial public offering (IPO) of HDFC Life in that meeting. Besides, it is planning to give approval to one or two companies to start their non-life businesses.

“We have received application from HDFC Life for its IPO and an in-principle approval for the same would also be on the agenda of the meeting. A final decision would also be taken on the regulations and guidelines for brokers, which have been pending for a few months,” a senior Irdai official said on condition of anonymity.

Housing Development Finance Corporation Limited (HDFC) and its joint venture partner Standard Life (Mauritius Holdings) 2006 Limited, have offered to sell a 15% stake in their life insurance venture through an IPO. While HDFC will offload 9.57% of equity paid-up, Standard Life would dilute 5.43% in the IPO. HDFC Life decided to go ahead with its IPO after merger with Max Life Insurance was rejected by the Irdai citing violation of Section 35 of the Insurance Act.

Also the brokers regulations would be taken by the insurance regulator in its board meet. In its draft proposal, the insurance regulator has suggested many key changes to overhaul the existing insurance brokers industry and for monitoring the segment more closely.

Consequent upon promulgation of Insurance Laws (Amendment) Act, 2015, the existing insurance broker regulations would undergo a change. In addition to the developments in the market and the experience of the last three years, there is a need to update the broker regulations, said exposure draft released in March.

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Irdai has proposed raising the capital requirement of an insurance broker. After almost 13 years since broking was allowed in the domestic insurance industry. Insurance regulator has suggested doubling the capital requirements for direct/reinsurance and composite broker. Senior officials in the insurance industry say that there would be many new regulations coming in which can increase the cost of brokers doing their business.

“We are also considering final approvals to one or two non-life companies to start their operations. There is a lot of interest in the non-life industry and we expect more players to enter this segment in the months to come, especially the specialised players,” said an official from Irdai.