Irda allows insurance for markets
“The authority believes that this is commensurate and appropriate given the size of funds under consideration without adversely affecting the prudential management of investments,” Irda said on its website on Friday. The finance ministry has been favourably inclined to allowing insurers to park a larger share of their corpus in equities. The government had earlier allowed Life Insurance Corporation of India (LIC) to hold up to 30% of the equity of a company in a move aimed at helping its disinvestment programme. LIC has bailed out stake sales of several of the disinvestment candidates in the past.
The insurance regulator, however, had spoken out against the move, calling it “imprudent” while stating that LIC should be treated at par with all other private insurers. As per the Insurance Act, 1999, an insurance firm is allowed to hold up to 10% equity in a company. The finance ministry had raised the investment cap after pointing out