The Insurance Regulatory and Development Authority of India (IRDAI) approved the registration of Kshema General Insurance as part of measures to improve the ease of doing business, increase competitiveness, spur investments and attract newer players. It also cleared non-life insurer Go Digit’s IPO and approved the Exide Life-HDFC Life merger.
There are 19 more registration applications in the pipeline at different stages of approval. “We expect that within 60 days or two board meetings we will be in a position to approve applications subject to the condition that the other side is ready,” said IRDAI chairman Debasish Panda.
As part of reforms, corporate agents (which include banks) can now partner with nine insurers as against three earlier, while insurance marketing firms can distribute for six insurers, up from the earlier two. Private equity (PE) funds can invest in insurance companies, and promoters can dilute their stake to 26 percent (from 50 percent earlier). The lock-in period for investors and promoters is now linked to the company’s maturity, with only one-year lock-in for a matured insurer. Also, no prior nod is needed for issuing subordinate debt and preference shares.
Panda said these moves are part of efforts to create an ecosystem that is “competitive, supportive, facilitative, forward-looking and progressive”. To further its goal of insurance for all by 2047, IRDAI plans to have a framework similar to the state-level bankers’ committee (SLBCs). The insurance regulator is looking at Bima Vistaar, Bima Vahak and Bima Sugam to help the entire ecosystem and policyholders.