India's largest life insurer Life Insurance Corporation's (LIC) debt investment ceiling in an individual company may be increased to 20% from the existing 10%, albeit only for the exchange-traded debt issues, sector regulator Insurance Regulatory and Development Authority's (IRDA) Chairman J Hari Narayan said.
“We are considering LIC’s request for additional exposure in debt. If the bonds issued by the company are exchange-traded, then LIC’s exposure can go up to 20%,” Narayan said at an event.
However, the equity exposure limit of the state-run insurance company will be kept unchanged at 10%, he added.
During the current fiscal year 2011-12, LIC’s total investment in debt and equities is expected to be at Rs 1.8 trillion, down from Rs 1.93 trillion invested last year.
The life insurance behemoth is also expected to limit its equity investments to Rs 350-400 billion in 2011-12 from Rs 600 billion projected at the beginning of the year, due to slower growth in premium income.
In fiscal first quarter (April-June) LIC posted the highest decline, among other life insurers, in its total premium collection at Rs 140.61 billion, down 25% on-year.
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