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Final guidelines for reinsurers in October : IRDA chairman

Mumbai: Insurance Regulatory and Development Authority (Irda) said it is working on the final guidelines for reinsurers, which will come out by October.

“About 7 to 8 global and domestic reinsurance players have shown interest for licence to begin operations in the country so far. We are working on the guidelines. We will come up with the final guidelines by October,” Irda chairman T S Vijayan said.

Talking about management control after the foreign direct investment (FDI) limit was hiked to 49% from the previous 26%, the regulator said Irda will come up with the guidelines in this regard soon and will put it under corporate governance structure.

“The Act clearly says that being a major shareholder, the management control should be with the Indian partner. However, we are working on it and the final guidelines will come up shortly on the same. We will bring the guidelines under corporate governance structure,” he added.

On unit-linked products (ULIP) investment on government securities, Vijayan said the regulator has received a large amount of comments and will soon release the final guidelines by December.

Irda had recently come up with a draft which says that life insurers have to put 25% from ULIP in government securities. This move is being opposed by insurers as they feel it is the policy holders who decide on ULIP investment.

Talking on bancssurance guidelines, which specify the rules for insurance companies to appoint banks as their corporate agents to sell policies, Vijayan said, “We want to have a look at the impact of making it non-mandatory under corporate agency norm.

“However, there is a committee which has submitted a report on open architecture and we will look into it. We will come up with guidelines within two weeks.”

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