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IRDA to finalise on IPO guidelines of the Insurance Companies
J Harinarayan, Chairman, IRDA, said "The exposure draft (on IPO guideline) has been released. We are waiting for the comments of various stakeholders including public. I expect the comments should be in another week's time."
He further addded that the final guideline should be out by the end of the June 2011.
In Octorber 2010, the capital market regulator -- Sebi -- had given the go-ahead to the insurance companies for coming out with IPOs.
Current regulation requires that insurance companies must complete 10 years of operation before they can get listing permission.
It is likely that IRDA will allow permission to only those companies which have presence in the market for the last 10 years. The companies need to be profitable entity for the last three years.
There are 22 companies which offer life insurance policies. This does nor include Life Insurance Corporation, the biggest player in the segment.
Some private insurance companies like Reliance Life is to complete 10 years in existance and HDFC Standard Life has already completed a deceade of business.
On the issue of motor insurance, chairman said, there is merit for deregulating third party motor. Then pricing will be based on competitive situation, which will be the best pricing, besides this will enable companies to manage risk.
A deregulated regime for third party or any insurance is advisable regime. However in India, third-party motor pool has a long history and there are concerns at the present moment, he said.
"We will continue to regulate it. We will take steps in that (deregulating it) direction gradually. At the present moment there is no need to deregulate it," he added.
OneIndia Money
