Foreign capital comes post easing of insurance FDI norms
Mumbai, Aug 12: TS Vijayan, chairman of the Insurance Regulatory and Development Authority of India (Irdai), on Friday said the insurance sector has received foreign capital inflow of Rs 16,000 crore after the foreign direct investment (FDI) limit was increased to 49% from 26%.
Speaking on the sidelines of the CII Insurance Summit, Vijayan said the purpose to bring out a discussion paper on listing of insurance companies was that it would bring in more transparency into the working of the company, not jutt for shareholders but for outsiders as well.
“We are also thinking that even companies that are not listed should also bring disclosures requirement similar of any listed company. So we are awaiting the feedback from the people and will later decide on that rules,” Vijayan sadi. Irdai in it board meeting in October is likely to take up the consideration of several foreign re-insurers who have applied for branch presence in India.
Vijayan urged the insurance industry to design products in such a way that they could make it easier for customers to tide over situations like fluctuating income levels and other risks during the long tenure of plans. This will stem the premature termination of policies to a great extent, Vijayan said.
On mergers and consolidation in the industry, he said customer protection is the key and the regulator will ensure that fair treatment is given to them. There were some report that regulator had raised some concerns about the proposed HDFCMax Life merger, but the chairman clarified there was no concern and made it clear that customer protection is key.
“If two companies are merging together, it is nothing new in the Indian insurance industry. When LIC was formed many number of companies were merged into it. It is a natural process but we are very clear that customer protection is the key, whatever promises the companies have made to the customer is going to be the key. What reserves they are maintaining for the customers is the important. We will be keen to ensure fair treatment of customers,” Viyayan said.