Investment limit of insurers hiked to 20% IT, pharma sector: IRDA

India Infoline News Service | Mumbai |

Presently, insurers are permitted to take exposure in a specific industry up to 15% of the Investment Assets

The IRDA (Insurance Regulatory and Development Authority) on Wednesday increased the investment limit of insurers from 15 per cent to 20 per cent in sectors such as IT and pharma.

Presently, insurers are permitted to take exposure in a specific industry up to 15% of the Investment Assets (25% in case of BFSI sector and no exposure limit for Infrastructure sector), the IRDA said in a circular.

According to IRDA, industrial weightage on the benchmark indices is dynamic and presently IT industry contributes more than 15% on the benchmark indices. As the weightage keeps on changing from time to time, it is decided to give general permission to have exposure of further 5% in one industrial sector (not applicable to BFSI), IRDA added.

However, prior permission needs to be obtained from the respective Board of the Insurer. Board can permit such additional exposure in one industry by cancelling the earlier approval, if any, in this regard.

At any point of time, Insurers are permitted to have excess weightage beyond 15% in only one Industrial sector (except BFSI and Infrastructure sectors).
 

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