LIC may have to wait more to invest 30% in equity: Reports

India Infoline News Service | Mumbai |

IRDA on Thursday said that there was complete oversight on LIC with regard to both market conduct and prudential regulations

According to insurance experts, IRDA (Insurance Regulatory and Development Authority) may take time to allow Life Insurance Corporation of India (LIC) to invest 30% in equity segment, as quoted in a media report.

Thus, the state-run insurer may have to wait more before IRDA permits it to invest up to 30% in equity market, the report added.

The insurance regulator had recently increased the equity investment cap for insurers from 10% to 12% and 15%, depending on the size of the controlled fund. LIC is allowed to invest 15%, the report said further.

IRDA on Thursday said that there was complete oversight on LIC with regard to both market conduct and prudential regulations.

International Monetary Fund (IMF) in its report said: "The current uncertainty regarding Irda's control of its funding and budget, its incomplete oversight of LIC, and the reserve powers of the central government to direct its activities all potentially detract from the supervisor's powers and independence."

Responding to the IMF report, IRDA Chairman TS Vijayan said that the regulatory oversight of LIC is quite comprehensive to the extent that it requires monitoring both prudential and market conduct operations of LIC.

Although the LIC Act excludes the applicability of certain provisions of Insurance Act, 1938, there is no dilution on the regulatory oversight on the life insurer, IRDA chairman added.



 

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