The Insurance Regulatory and Development Authority (IRDA) is not keen to increase the equity investment cap for private insurers. At present, the equity investment cap for private insurers is 10%, Radhakrishnan Nair, member (finance & investment) of IRDA, said.
A revision in limit can only be facilitated if there is a change in the Insurance Act, Mr Nair added. Mr Nair was speaking on the sidelines of a Ficci-BOAO Forum for Asia on 27th November.
According to a notification by the finance ministry, Life Insurance Corporation of India (LIC) has been allowed to invest up to 30%.
IRDA plans to introduce risk-based solvency
The Insurance Regulatory and Development Authority (IRDA) is planning to shift insurers to a risk-based solvency model from the current factor-based solvency model, Radhakrishnan Nair, member (finance & investment) at IRDA, said.
Mr Nair was speaking on the sidelines of a Ficci-BOAO Forum for Asia on 27th November.
The model would involve some risk management by the insurer and help maintain a standardised model and appropriate risk-based pricing, Mr Nair added.
IRDA has formed a committee—comprising experts from the sector—headed by an actuary for this purpose. The committee will present a report on both the life and non-life insurance segments to the IRDA chairman by January.
However, there would be no dilution in the regulatory capital requirement. The present solvency margin stands at 150%, Mr Nair said.
