This was one of the major items in the agenda in the recent meeting with the Finance Minister.
For a long time insurers have been trying to ease the current investment norms. In the recent meeting with the Finance Ministry, the officials discussed various possibilities of relaxing norms for insurance companies to attract more funds for the infrastructure sector.
Currently, the investment corpus with the life insurance companies is Rs 13 lakh crore, out of which 20 per cent goes to the infrastructure sector. As per current IRDA norms, insurance companies can invest only in highest rated 'AAA' or 'AA' credit-rated debt paper so exposure to infrastructure sector gets impacted.
Life insurance companies are allowed to invest up to 50 per cent in government securities, 15 per cent in infrastructure bonds and 35 per cent in other investment grade corporate bonds and equities. During the meeting, the chairman of IRDA said that investment norms would be re-looked at, said a senior official present in the meeting.
“The agenda is still under discussion. But the ministry has understood the need for relaxation of investment norms and we expect some positive results, as it will help in the growth of the industry,” said CEO of a top life insurance company.
IRDA is reportedly planning to re-look at the investment norms in the next one month and prepare the revised norms before the second meeting with the ministry. IRDA is also evaluating the possibility of allow life insurance companies to invest more in non-AAA rated securities, including 'A+' and 'A' papers of corporates.