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.
Insurance Regulatory and Development Authority (IRDA) on Friday 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 told reporters on the sidelines of CII Insurance Summit here.
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."
Even though bancassurance allows banks to sell products of nine insurance companies, including three each life, non-life and health insurance firms, still it does not make it mandatory to adhere to this norm.
On listing of life insurance companies in capital markets, Vijayan said IRDA definitely expects it to take off in the next financial year.
When asked on the capital required by the industry post FDI hike, he said the pace of growth will decide the need of the funds.
On pricing of products, he added that the regulator will review some of the plans that he feels are wrongly priced.
"We have observed that claim-ratio are very low in some of the products and even their pricing is wrong. The companies have to look how they are distributing and servicing those products," he pointed out.
He further said that the regulator is working on disclosure norms on mis-selling of products in order to ensure that the customer is aware of what he is buying.
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