JOIN US“We are finalising the guidelines (on life insurance firms raising capital from the market). We hope to come out with the final guidelines on Initial Public Offering (IPO) by life insurance companies by end of this month,” Chairman J Hari Narayan said on the sidelines of Annual Health Insurance Conference organised by Ficci.
He indicated that guidelines relating to IPO for non-life insurance firms would take time.
The Irda last month came out with draft guidelines for insurance companies to raise funds through public offers.
As per the draft norms, only insurance firms, which have completed 10 years of operation and have strong financials will be allowed to come out with the IPO.
The draft paper suggested that insurance firms planning public offers would have to seek “formal approval” from IRDA and then approach the market regulator — Securities & Exchange Board of India (Sebi) —for final approval.
Initially for life companies, it was being suggested to make it mandatory that those insurance firms, who have a three-year track record of profitability, could only come out with IPO. However, Narayan said this mandatory clause had already been removed.
The draft guidelines now suggest that as part of the eligibility criteria, the insurance company should have maintained the prescribed regulatory solvency margin during the preceding six quarters.
Earlier inaugurating the conference Narayan called for a new model of health insurance that covers both surgical and out-patient treatment, including child birth related procedures.